More properties languish on the market as buyers get the jitters

Stubborn sellers and nervous buyers are responsible for a sharp increase in the number of Australian homes languishing on the market for six months or more, experts say.

In May, 73,820 properties nationally had been on market for 180 days or longer, representing a monthly increase of 10.5 per cent, according to SQM Research.

So-called ‘old listings’ accounted for 28.52 per cent of the entire property market in that period, on SQM data.

The rise was not uniform across the capital cities: old listings increased a substantial 13.4 per cent in Canberra, 10.2 per cent in Sydney and 9.0 per cent in Melbourne, but rose a modest 3.6 per cent in Perth and 0.6 per cent in Hobart.

Louis Christopher, managing director at SQM, said property listings generally went stale when sellers stuck to unrealistic pricing expectations.

“In the vast majority of cases it’s because the vendor has not only mispriced the property, but also won’t respond to buyer feedback.”

Christopher said old listings data was a reliable proxy for the health of the property market.

“In an ‘up’ market, overpriced properties will eventually get bought as the market catches up to the asking price. But in a ‘down’ market, that doesn’t happen, and those overpriced properties linger for longer and longer.”

While the number of old listings nationally rose over the month, it was down 10.8 per cent nationally over the year to May, which Christopher said illustrates his point.

“In the back half of 2025, we saw the introduction of the first-home-buyers’ scheme and the flow-on effects of interest rate cuts, which stimulated the market and led to an absorption of stock that might have otherwise gone unsold.

“This year, with rates rising and other factors dampening the market, old stock numbers are rising again. In time, maybe as soon as next month, I think we will see a year-on-year increase.”

In Sydney, old listings were down 3.3 per cent over the year to May, while in Melbourne, it was 7.1 per cent.

Christopher said the upward trend should serve as a warning to sellers.

“The message is that if you don’t meet the market, you’re not going to sell your property, and you’re going to end up being a statistic on our database.”

Jarrod McCabe, director of Wakelin Property Advisory, said hesitant buyers were contributing to a build-up of old stock in Melbourne.

“In an uncertain time like we’re in at the moment, buyers tend to sit on their hands. Demand has certainly come off the boil, and the buyers who are still inspecting properties are generally holding back.”

With fewer buyers active in the market, McCabe said sellers hoping to avoid a protracted campaign should think carefully about who their property might appeal to.

“Understanding the likely buyer profile for your property, and ensuring that it’s marketed to that profile, can be just as important as pricing.”

As rate hikes and the proposed changes to negative gearing and capital gains tax cause investors to withdraw, appealing to owner-occupiers could make the difference between selling your property promptly or seeing it languish, McCabe said.

“What’s acceptable to an investor and what’s acceptable to an owner-occupier are two different things, and with the current uncertainty, investors are much less likely to walk through your door.

“If you’re prepared to spend a little bit of money to improve your property’s appeal and attract owner-occupiers, as opposed to a bare-minimum approach, you’re more likely to see a result in this market.”

Sydney-based buyers’ agent Michelle May said the recent deterioration of market conditions had led to a glut of less-appealing properties.

“Properties that are on main roads, have a compromised floor plan or are in areas with a lot of comparable on-market stock are struggling to attract interest, even if they are well-priced, and so they are languishing for months on end.”

Other properties fail to sell because vendors have unrealistic expectations, May said.

“When agents priced those properties earlier this year, they may have been talking about one market, but by the time the properties were actually listed, it may have become a different market altogether.”

Some sellers remain “in denial” about current market conditions, May said.

“I just looked at a property that was onto its third agent because the vendor is delusional and won’t adjust the price. The agent threw his hands in the air and said: ‘Make me an offer, and I’ll see what I can do,’ but he clearly has no control over the vendor.”

May said she had recently noticed an increase in agents contacting her about properties that have been on-market for several months or more.

“We’re getting a lot of phone calls and emails. Everyone’s coming out of the woodwork now because it’s a lot harder to sell those properties.”