"FOMO" to"FOMM" - What Does It Means!

There have been several articles released last week with yet another new real estate phrase being mentioned.

Throughout 2021 & 2022 the term FOMO was widely used to discuss buyer sentiment in a buoyant market that translated into incredible price rises.

Of course the term FOMO is related to the fear of missing out.

It was fear of missing out from buyers that led to astronomical price growth in the property market..

Now that we are in mid 2023 and interest rate rises amongst other factors have slowed the property market.

Many buyers and sellers are reading and hearing mixed property reports almost daily which is leading to a new property trend.

"FOMO" has now been replaced by what the media are tagging "FOMM" - Fear Of Making a Mistake

Buyers have been scared of paying too much and sellers have been scared of accepting a lower than expected offer as both are unsure of market value and market sentiment.

This renewed buyer activity has been difficult for potential sellers to comprehend. 

As real estate agents, we can see the buyer pool growing, however sellers see data from media reports that are often two to three months old.

Last week, an article was released by realestate.com.au that should give every potential seller the confidence that now is an outstanding time to sell.

The below article with the headline "Unseasonably strong market puts sellers in prime position" is the first published article to report what we already know. 

Buyer interest is extremely strong, they just have very few choices when it comes to available properties for purchase.

In simple terms, if you want a fantastic result, the time to sell is now.

Unseasonably Strong Market Puts Sellers In Prime Position

Winter is traditionally a quiet period for the property market, but stronger sales volumes and unseasonably high buyer demand in some cities and regions suggest that sellers are in prime position in the coming months.

Sale volumes picking up in some regions

Property transactions in Sydney and Canberra were up 13.5% and 8.5% in June, compared to the same time last year. Perth and Hobart also recorded year-on-year growth in volumes.

So far, in 2023, national monthly sales volumes have been lower than in 2022. However, in the past few weeks, sales have been picking up. If this trend continues, sales in July will be higher than last year.  

The market was very strong in 2021 and 2022, so sales in 2023 are lower in comparison. However, compared to 2019 and 2020, sales are up.

This time last year, sales in all regions were down except Canberra. This suggests buyers are not feeling the winter chill this year and are out in force.

The volume of highly engaged buyers has increased

The number of highly engaged buyers interacting with properties on realestate.com.au increased by 0.6% nationally year-on-year in June.

In fact, over the past four months, we've seen the highest number of highly engaged buyers on the platform than at any time over the past five years.

Even during 2021, when the market was extremely strong, the number of highly engaged buyers was lower than what has been recorded over the past few months.

The regions driving the increase are the cities of Brisbane, Perth, Canberra, and Sydney as well as regional NSW, Queensland (QLD), and South Australia (SA).

However, not every capital city and regional area has seen an increase in the number of highly engaged buyers. Even so, because most regions have been experiencing lower listings volumes, the number of highly engaged buyers per listing is up on last year in most parts of Australia.

Five of the capital cities have experienced double-digit growth, with Perth experiencing a 38.8% growth in buyers per listing.

Even Melbourne and Adelaide, which have seen a decrease in the number of highly engaged buyers overall, have more engaged buyers per listing than last year.

Home prices have rebounded

Home prices have increased for six consecutive months. Having increased a further 0.3% in June 2023, prices are now sitting just 0.1% lower than a year ago.

Looking at the combined capital cities, home prices are now slightly higher than a year ago, up 0.06%.

Sydney’s median home value is 4.5% higher than its low point last year and is now just 3% below its peak recorded in February 2022.

Auction clearance rates remain robust

Auction clearance rates are 23% higher than they were at the same time last year and only 9% lower than in 2021 when the market was incredibly strong.

Sydney and Melbourne primarily dominate the auction market, and both have seen clearance rates above 60% throughout 2023.

The shortage of available properties on the market has caused a decrease in the number of scheduled auctions, but auction volumes are still higher in both cities than they were pre-pandemic.

In the coming months

July and August are traditionally quieter months with many buyers and sellers opting to hold off until the start of spring. However, so far this year we have seen some unseasonal trends across Australia that suggest buyers are not waiting for the warmer weather.

The biggest issue currently facing the property market is the lack of stock, and with demand still high, there is limited choice for those wanting to buy.

Those selling, however, are benefiting from high buyer demand and low competition from other vendors, which is in large part why prices are on the up.