Melbourne home buyers have far less choice than they did a year ago, new data shows, as owners hold back from listing their properties for sale in the cooling spring market.

In some parts of the city, new listing numbers are down by as much as 20 per cent compared to spring last year, when COVID-19 lockdowns meant in-person property inspections could not resume until mid-September.

New listings have dropped in every region of the city since September last year, Domain data shows, but the biggest falls are in the outer, more affordable areas of Melbourne.

In the outer east, new listings are down by 20.5 per cent compared to last year.

In the north-east, new listings fell by 17.3 per cent, and in the south-east they fell 17.1 per cent.

Buyers in the outer east and south-east have less choice than they did in the last property downturn, but the picture is mixed. In the inner city, there are 32.7 per cent more offerings than in September 2018, and the inner south is up 21.4 per cent.

This spring rising interest rates, including the 0.25 per cent increase on Tuesday, and falling house prices have spooked sellers.

Owners who had planned to list their homes for sale in spring, usually one of the busiest times of year, are now holding back.

KR Peters Real Estate Wantirna director Peter Nicolls said he believed the spring market would start late, as sellers’ confidence took a hit from falling house prices.

“There is a shortage of stock out there – a big shortage of stock,” Nicolls said. “But because there is a limit on what’s being offered, there is a possibility of more competition for those properties [from buyers].”

Though many home hunters were nervous about coming interest rate rises, some were still in the market bargain hunting, particularly upsizers buying a better home for less than they had planned, Nicolls said.

* extract taken from Domain article by Melissa Heagney, October 9, 2022. See full article here.