Sellers hiking their asking prices to keep up with booming property market

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on May 25, 2021
Sellers hiking their asking prices to keep up with booming property market

Rapidly rising property prices are seeing vendors increasingly raise their asking prices mid-campaign to keep up.

If there was any doubt it's a sellers market right now, new analysis by Domain has found that vendors are feeling so confident in the booming market right now that they're commanding even higher asking prices mid-sales campaign.

But the analysis also found the number of property listings with a revised higher asking price appears to have peaked in most capital cities, a sign the strong pace of price growth may be easing.

Domain data shows 9.3% of property listing prices in Sydney were increased last month, down from a peak of nearly 10% in March.

In Melbourne, 7.8% of homes for sale increased their asking price mid-campaign in April, down from 8.9% of March.


Buying a home or looking to refinance? The table below features home loans with some of the lowest interest rates on the market for owner occupiers.

Lender
Advertised rate Comparison rate* Monthly repayment Rate TypeOffsetRedrawOngoing FeeUpfront FeesLVRLump Sum RepaymentAdditional RepaymentsPre-approval

VariableMore details
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
VariableMore details
ZERO APPLICATION FEESFEE FREE OFFSET

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
  • No upfront or ongoing fees
ZERO APPLICATION FEESFEE FREE OFFSET

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
  • No upfront or ongoing fees
FixedMore details
USE A MARKET LEADING APP TO HELP YOU PAY OFF YOUR LOAN SOONER

Fixed Home Loan 1 year (Principal and Interest) (LVR < 80%)

  • Make up to $20,000 additional repayments per fixed term
  • Redraw available – lets you access any extra loan repayments you’ve made
  • Choose to rate lock for 90 days (fee applies)
USE A MARKET LEADING APP TO HELP YOU PAY OFF YOUR LOAN SOONER

Fixed Home Loan 1 year (Principal and Interest) (LVR < 80%)

  • Make up to $20,000 additional repayments per fixed term
  • Redraw available – lets you access any extra loan repayments you’ve made
  • Choose to rate lock for 90 days (fee applies)
VariableMore details
REFINANCE IN MINUTES, NOT WEEKS

Variable Owner Occupied, Principal and Interest (Refinance Only)(LVR <75%)

  • No application or ongoing fees.
  • 100% free offset sub account.
  • Fast online application, approval in minutes not weeks.
  • Mobile app, Visa debit card, Apple and Google Pay
  • Refinance loans and variable rates only.
REFINANCE IN MINUTES, NOT WEEKS

Variable Owner Occupied, Principal and Interest (Refinance Only)(LVR <75%)

  • No application or ongoing fees.
  • 100% free offset sub account.
  • Fast online application, approval in minutes not weeks.
  • Mobile app, Visa debit card, Apple and Google Pay
  • Refinance loans and variable rates only.

Rates correct as of January 25, 2022. View disclaimer.


With house prices recently notching the steepest quarterly increase in 18 years, Domain Senior Research Analyst Dr Nicola Powell said vendors are feeling more confident about commanding higher asking prices.

"Throughout the first three months of 2021 the median house price lifted $539. In Sydney and Canberra, it was the fastest quarterly acceleration of house prices in almost three decades," Dr Powell said.

"Buyers and sellers were transacting in a market that saw house prices rise by $1,145 a day in Sydney and $909 a day in Canberra.

"Accruing capital growth at this pace over a four-week sales campaign would add another $32,060 in Sydney and $25,452 in Canberra.

"This can be accentuated in a rapidly rising market as battling buyers become more likely to drive prices even higher. It is understandable that during a period of sharp median price increases more homes experience an asking price hike mid-campaign."

Domain1.JPG

Source: Domain

Areas with the biggest number of properties increasing their prices mid campaign were in pockets of inner-Sydney and Melbourne, with 14% 

"The more expensive areas of Sydney and Melbourne have the highest percentage of asking price revisions upwards over April. This suggests the upper end of the market will continue to lead price growth in the coming months," Dr Powell said.

But vendors in regional areas are less likely to hike their asking prices, despite property price growth in regional areas doubling those in capital cities.

"The capitals tend to exhibit greater price volatility versus regional Australia. During periods of price growth, capitals tend to have bigger upswings followed by deeper downturns," Dr Powell said.

"Therefore, our regional property markets in comparison have historically gone through more steady changes and paces of growth compared with capital cities, which is playing out in the percentage of sale listings with an increased asking price mid-campaign."


Photo by Patrick McGregor on Unsplash

Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered. Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site. Savings.com.au, yourmortgage.com.au, yourinvestmentpropertymag.com.au, and Performance Drive are part of the Savings Media group. In the interests of full disclosure, the Savings Media Group are associated with the Firstmac Group. To read about how Savings Media Group manages potential conflicts of interest, along with how we get paid, please visit the web site links at the bottom of this page.

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Emma Duffy is Assistant Editor at Your Mortgage and  Your Investment Property Mag, which are part of the Savings Media Group. In this role, she manages a team of journalists and expert contributors committed to keeping readers informed about the latest home loan and finance news and trends, as well as providing in-depth property guides. She is also a finance journalist at Savings.com.au which she joined shortly after its launch in early 2019. Emma has a Bachelor in Journalism and has been published in several other publications and been featured on radio.

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