The phrase “buyer’s market” is used so often to describe falling house prices that it has lost its relevance to supply and demand. It can be misleading when analyzing Brisbane real estate.
From 2022 to 2023 both the average and median house price fell significantly in Brisbane. That does not mean it is a buyer’s market in Brisbane. Home buyers changed when they purchased their house rather than simply fewer people deciding to buy or more homes being available. The expected mortgage increase in 2023 would raise the cost of purchasing a home. Home buyers looked at paying a little more for the house versus paying a higher interest rate and decided to move their purchase date forward to beat the mortgage increase. Those home buyers who bought a home in 2023 generally have costs as much or more than those who purchased in 2022 because of higher mortgage costs. Economic policies change the cost of purchasing a home. It is not simply sellers deciding to charge more or less.
It is more expensive to build homes in Brisbane and to provide utilities to them than when there was land available to build a tract of homes. Discussions about buyer’s market vs. seller’s market miss much of what has driven housing prices and rarely help predict future Brisbane home prices.
Many people in Silicon Valley made significant money during the dot com boom in 2000. This rapid increase in money lead to an increased demand for luxury housing and thus created a seller’s market that didn’t affect all homes equally.
The graph of house prices in Atherton shown above shows that there was a roughly year-long spike upward in Atherton house prices. The increased wealth increased the demand for luxury homes and created a roughly year-long “seller’s market” in Atherton. This seller’s market was not seen in Brisbane.