Jump in price-filtered searches reveals new home buyer desires

One of the major impacts of the COVID-19 recession has been that people have been extremely restricted in the ways they can spend their money.

Shutdowns have restricted individuals’ ability to eat out and go to sporting events while closed domestic and international borders have reduced people’s ability to travel – a luxury that many Australians enjoy each year.

With borrowing costs the lowest they have ever been – and unlikely to increase for some time – and restrictions on people’s ability to move and spend, it appears that an increasing number of Australians are contemplating putting their excess cash into the property market.

This is highlighted by the fact that overall search volumes on realestate.com.au are higher than they were a year ago and price-filtered searches are also increasing.

A jump in filtered searches reveals new buyer behaviours

Searches for properties listed for sale with a price filter show the changing nature of search behaviour across the country over the past year.

While most searches undertaken on realestate.com.au are done without price filters, we still see a large volume of searches undertaken with these filters and they can provide meaningful insight into the changing nature of the market.

Here are six key trends that we are seeing in the price filter search data:

A higher proportion of searches at lower price points

In September 2019, 32.9% of price-filtered searches nationally had a maximum price of $500,000 or less with the share having increased to 33.7% in September 2020.

Searches for properties over $1m have increased

In September 2020, 23.1% of price-filtered searches had a maximum search price above $1 million, which was up from 21.2% at the same time in 2020.

More searches over $1m in the capital cities than regions

In September 2020, 21.2% of all capital city price-filtered searches were for properties listed for more than $1 million compared to 10.6% of searches across regional Australia.

Shift in searches over $1m greater in regional markets

While a lot more searches for properties listed for more than $1 million occur in the capital cities, regional markets have seen a much larger increase in their share of $1 million searches over the past year.

The combined regional markets have seen price-filtered searches for properties priced in excess of $1 million increase from 8.9% of searches in September 2019 to 10.6% in September 2020, while in the capital city markets the share has shifted from 20.8% a year ago to 21.2% this year.

Fewer searches over $1m in Melbourne but regional Vic jumped

The share of price-filtered searches for properties in excess of $1 million in Melbourne has fallen from 21.4% a year ago to 20.0% this year.

Meanwhile, in regional Victoria searches for properties in excess of $1 million have increased from 6.1% of price-filtered searches a year ago to 7.1% this year.

Darwin and regional Northern Territory are the only two regions outside of Melbourne to have recorded a fall in the share of price-filtered searches for properties priced in excess of $1 million over the past year.

Searches for $1m properties across NSW more prevalent

The volume of price-filtered searches for Sydney properties in excess of $1 million increased by 250 basis points from a year ago, rising from 38.2% of searches to 40.7%.

In regional New South Wales, the increasing prevalence of searches for million-dollar properties has been even more significant than in Sydney with the share of these searches rising from 11.3% a year ago to 14.0% this year.

What do these search trends tell us?

There has been plenty of talk about the fact that working from home will become a more permanent fixture of Australian employment and that may open up the opportunity for people to move away from capital cities.

Search behaviour itself doesn’t prove or disprove this theory, but it does highlight that people are certainly considering the move and looking at properties in regional Australia.

Of these price-filtered searches, there were still almost twice as many capital city searches than regional ones, however, the volume of capital city searches has grown by 23% over the past year compared to a 46% rise in regional searches.

The data also indicates that it isn’t just people who have been priced out of the capital cities who are potentially looking to move to regional markets, given the significant shift in the volume of searches for properties listed in excess of $1 million.

Source: https://www.realestate.com.au/insights/jump-in-price-filtered-searches-reveals-new-home-buyer-desires/

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