Christies Beach One of RP Data’s core services is supplying real estate agents with timely property data to assist them with undertaking comparative analysis of their local market place (amongst other things), which they in turn use to determine the appropriate listing price of a property. Our services are used by approximately 70% of all real estate agencies nationally. One of the important bi-products of our market share is monitoring the level of agent activity across our data platforms.
As a simple example, counting the number of Comparative Market Analysis (CMA) reports as well as monitoring other platform activity such as the number of logins and searches provides a unique insight around the number of homes which are likely being prepared for sale. We use this metadata to provide a lead indicator for new listings about to enter the market.
RP Data’s Listing Index (RLI) is currently at record levels after the seasonal slump in real estate agent activity. It’s normal for the market to slow down over the last week of December and throughout most of January; the slump is typically followed by a surge in real estate agent activity as industry participants emerge from the festive period. The graph below tracks the national RLI. We recorded more than 65,000 activity events from real estate agents over the 28 days ending February 9th, which is a record number across the series which extends back to January 2009.
The activity occurring across the RP Data platforms correlates well with the number of new listings entering the market over the coming weeks so we are expecting more properties to hit the market for sale as we approach the autumn season. Prospective vendors are likely to be confident considering the current housing market conditions are mostly favouring sellers rather than buyers – putting it simply, it’s a great time to be selling a property.
There is some variability in the amount of activity we are seeing from region to region.
Sydney’s RLI has returned to a level slightly higher than last year which is normal for this time of the season. The index was elevated over the second half of 2013 in line with the strong housing market conditions and we expect listing numbers to track at roughly the same rate as what was recorded over the past six months which has been about 7,500 new listings each month. Considering the run rate of sales across Sydney is tracking at about 8,860 per month we expect effective supply levels to remain tight across the Sydney market.
In Melbourne the RLI is at record levels; the second half of 2013 saw a consistent ramp up in agent activity in line with the strong housing market conditions that were very much evident over the same period of time. The post festive season surge will settle around the first week of March, so we would expect agent activity to return to approximately the same level we were recording at the end of 2013. New listing numbers across Melbourne were tracking at around 7,800 per month compared with a run rate of sales of about 7,400 per month so we are potentially going to see an increase in total effective supply levels across Melbourne over the coming months.
Brisbane agent activity is absolutely surging at the moment with the RLI for Brisbane moving about 20% higher than what was recorded during mid-December. It is likely the Brisbane housing market is right on the cusp of accelerated market activity as attention moves away from Sydney and Melbourne to Brisbane where capital gains to date have been modest, yields are substantially higher and affordability isn’t as much of a concern as the other major capitals. We have been seeing an average of about 3,900 new listings enter the market across Brisbane each month compared with a run rate of sales at 3,950 per month; so demand and effective supply levels look broadly in line currently. We anticipate there will be a ramp up in market activity over the first half of 2014 which is likely to be accompanied by an increase in new listing numbers as well.
Agent activity has been on an upwards trend across Adelaide over the past twelve months, with the RLI currently at similar levels as what was recorded late last year. Confidence in the local SA economy has been dented by the weakness in the manufacturing sector, however the housing market has been slowly improving despite the weaker economic conditions. We have been tracking about 1,880 new listings being added to the local market each month compared with a sales rate of about 2,240 each month. Transaction numbers are outweighing listing numbers, keeping effective supply levels tight.
Perth has seen a rise in agent activity over the first month of the New Year, however current activity levels are slightly below record levels but higher than late 2013. It’s likely that agent activity levels will settle back to around the same pace as what was recorded late last year; not quite as exuberant as what was recorded during early 2013, but still above the long term trend. The average number of new listings has been tracking at about 4,000 per month while transaction numbers are showing a run rate of 3,690 per month which indicated a growing level of effective supply overall.
Agent activity across Hobart has held relatively steady over the past year after a solid increase during the second half of 2012. The local Hobart market was the only capital city where dwelling values posted a fall over the past twelve months and conditions overall remain sluggish. We have been tracking about 410 new listings being added to the market each month and about 350 home sales which suggests plenty of choice for prospective buyers and not a great deal of urgency in their purchase decision.
The agent activity trend shows more volatility than other markets across Darwin, partly due to the small size of the market. Activity levels are currently well below the highs recorded back in early 2013, but similar to what was recorded in October/November last year. We are tracking about 250 new listings entering the Darwin market each month compared with a rate of sale at 289 per month, so effective supply looks relatively tight across this market.
The Canberra housing market has slowed substantially over 2013, however listings activity showed a consistent increase over the last four months of 2013. The bounce back in agent activity hasn’t been as strong in 2014 which may indicate new effective supply levels are starting to ease. Over the past six months we have seen an average of 580 new listings being added to the market compared with 610 sales per month on average suggesting that effective supply additions to the market are being absorbed sufficiently.
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