Residential property sales were at levels unseen for 16 years, during 2011. It is as if property buyers went into hibernation.
According to statistics released by RP Data, the truth hit property sellers very hard – no one was buying. Some parts of the country fared worse than others. The fact that borrowing for home loans was very difficult, did not assist the sale of property. First home buyers needed to put together larger deposits to qualify for home loans and low doc home loans were completely reworked by the NCCP.
Nationally, residential property sales declined 25 per cent below the decade average while in Brisbane they fell by 36.9 per cent. In all 34,368 properties sold in Brisbane last year, compared with 69,226 in 2007, before the start of the global financial crisis.
RP Data research analyst Cameron Kusher said only 373,000 sales were recorded across Australia during 2011.
The number of properties selling had started to fall away in September 2009 and continued to drop throughout last year.
This coincided with a decline in the volume of home loans and new home loan applications.
Houses accounted for 67 per cent of all sales last year.
“Clearly 2011 was a weak year for housing transactions,” Mr Kusher said. “In my opinion, the higher interest rate environment throughout much of the year and the general conservative nature of consumers appeared to be the biggest influences on such a low volume of sales.”
While the number of property sales dropped substantially last year so did Brisbane house values with median house prices down almost 7 per cent.
A number of economists are confident that the Reserve Bank will cut rates further in 2012 which is likely to improve residential property market sentiment further.