Gold Coast Market Update: What To Watch

The supply of unsold homes on the Gold Coast has doubled since March, rising from 1,300 up to 2,600. Why does this matter to you? Because by watching median house prices in news headlines, you're only seeing what's already happened, not what's about to happen. Measures of supply and demand move before the market does, so by watching them, you give yourself a chance to act before the market moves. Research has shown that a run-up in the supply of unsold homes on the market, like what we're seeing right now, is a typical setup before homeowners start discounting their asking prices. And that's what homeowners have just started doing on the Gold Coast, with the median asking price dropping from 1.7 million in Q1 down to 1.66 million in Q2. Meanwhile, the number of days that it takes for a home to sell on the Gold Coast has moved up to 40 days. That's coming up off 26 days earlier this year and now sits above the long-term average. If it stays at these levels or moves higher, we could see a failed spring selling season over the next couple of months. That would add even further to the supply of unsold homes on the market and put more pressure on homeowners to discount their prices. However, if it starts to turn and move lower, that could be one of the earliest signals that this market is strengthening. On the demand side, the demand for home loans has been decreasing. It's dropped from a reading of 20 in December down to 10 in June. Historically, declining demand for home loans has been associated with weaker house price growth 12 months later. Watching fundamentals means positioning yourself before the market moves. To stay ahead of the market, tap subscribe for free, fundamental analysis delivered to your inbox.