Market expectations have been falling across all states in Australia.
However, sentiment remains positive in some states in particular.
From January to March, 4,156 Australian vendors were surveyed with results split up into NSW, QLD, SA, VIC and WA.
These results are based on the OpenAgent Consumer Sentiment Index, a proprietary index system that measures vendor expectations for home price movement.
Vendors are asked whether they believe prices will be Strongly Up, Slightly Up, About The Same, Slightly Down or Strongly Down in their area within the next six months. Results are then placed on a scale of -10 to +10, with 0 being a neutral view of the market.
QLD has shown the highest sentiment this past quarter, sitting at around 2.1.
This suggests that the majority of home sellers in QLD believe that property prices in the state will continue to increase within the next six months.
Market expectations have remained relatively stable in QLD despite the ups and downs of other states.
The highest recorded sentiment in QLD has been 3.9 and the lowest has been 1.5.
Following closely behind QLD this past quarter was SA.
For the past couple of months, QLD and SA have been going back and forth as the state with the highest market expectations.
This past quarter, SA has had an average sentiment of around 1.8.
Therefore, though the majority of home sellers in SA believe property prices will continue to rise within the next six months, this majority isn’t as big compared to QLD.
At the beginning of the quarter, there was a tumble from 2.5 in December to 1.5 in January.
However, in March, sentiment spiked back up to 2.6, suggesting that sentiment might continue rising in SA in the coming months.
Though VIC looked like it was on the decline in December with a negative index of -0.1, sentiment surprisingly bounced back up this past quarter.
The average sentiment for VIC was around 0.4, starting at 0.2 in January before picking up to 0.8 in March.
This marginal increase could be explained by the higher clearance rate in the last quarter compared to the quarter before it.
The fluctuations in VIC make it hard to predict whether or not prices will grow in the near future, however, it’s unlikely that prices will be booming.
Market expectations in WA have been quite low since the beginning of the index.
Though it started to catch up with the other states last year, the sentiment is on a decline again.
Last quarter, the index dropped into negatives with an average of -0.3, suggesting that the majority of home sellers now believe that prices will decrease within the next six month.
Sentiment in NSW also fell into negatives, making it the state with the lowest market expectations in Australia.
Though market expectations in NSW were the strongest compared to other states around two years ago, they have been on a decline, dropping to an average of -0.9 in the last quarter.
Ultimately, if you’re hoping for prices to drop before buying, it might be worth the wait in WA and NSW.
However, in QLD, SA and VIC, prices are expected to increase or at least stay around the same as they are currently.
Guest author: James Pointon is a Commercial Manager at OpenAgent.com.au, an online agent comparison website helping Australians to sell, buy and own property.