According to CoreLogic’s latest Property Pulse – and a number of housing market indicators – many Australian regions have proved more resilient this year than last, despite head of research Eliza Owen conceding that “not all pockets of the housing market remain robust”.

The question remains: Are we faring better in 2021 than we were in 2020? Ms Owen shared the indicators of housing market performance that have seen dramatic changes over the past 18 months.

1. Consumer sentiment see ‘shallower’ decline Based on figures from ANZ-Roy Morgan, consumer sentiment declined 40.1 per cent through early 2020, during the first lockdowns. This lasted six weeks. In contrast, the current wave of lockdowns has so far seen a peak-to-trough fall in consumer sentiment that has lasted seven weeks, with a decline of by 12.3 per cent. According to Ms Owen, consumer confidence has been more resilient now given that they have more information “about the economic impact of lockdowns, and importantly, the strong recovery trend that followed stage 2 restrictions last year”. “Interestingly, the ANZ-Roy Morgan index seems to have stabilised above 100, which indicates more people are providing favourable answers to questions around economic and financial conditions.”

2. Sales activity continues decline, but not as much as last year Stage 2 restrictions in 2020 saw national sales volumes drop 33.9 per cent through April, including a fall of 36.7 per cent in Sydney and 40.3 per cent in Melbourne. This was largely attributed to restrictions that made transactions harder to carry out, as well as low levels of consumer confidence and high percentage of job loss, Ms Owen said.

This time around, despite the continued presence of social distancing restrictions, other factors have made for a more conducive environment for sales, including higher household savings, lower interest rates and an improving jobs sector, she explained. In fact, the decline in sales volumes have become much milder, with the month of July seeing only a 3.7 per cent fall in Sydney.

However, Ms Owen warned that sales volumes are likely to continue falling further the longer the lockdowns persist.

3. Fall in stock has been milder The decline in newly advertised stock has also been more subdued in 2021, with about 1,350 properties added to the Sydney market for the week ending 29 August – just 23 per cent lower than the five-year average pre-COVID.

“Assuming new listing volumes continue to climb, this marks a peak-to-trough decline of 37.5 per cent of new listings added to market since the onset of the Sydney lockdowns, compared to a peak to trough decline of 52.4 per cent through restrictions in early 2020,” Ms Owen explained. Melbourne, in comparison, recorded a steeper decline in new listings since August, but the Victorian capital “has also seen more volatility because lockdowns have been more frequent,” the researcher added. On average, weekly new listings across Melbourne (1,765) have actually been higher than in Sydney (1,577), and are higher than the average weekly listings added across Melbourne through 2020 (1,345).

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* By Bianca Dabu - Smart Property Investment September 2021