Three interest-rate cuts later, houses are taking longer to sell than last year

Houses are sitting on the market and taking longer to sell than they were 12 months ago despite three interest rate cuts, increased competition, and consumer sentiment soaring to its highest level in 42 months, new data reveals.

Over the past 12 months, the number of days that houses are taking to sell has increased in Sydney, Melbourne, Brisbane, Canberra, Hobart and Perth, according to Domain data.

Only houses in Darwin and Adelaide are selling faster.

Westpac and NAB banks both reported sharp lifts in consumer confidence on Tuesday, with Westpac’s Consumer Confidence Index showing it’s been three and a half years since confidence was this high, and home-buyer sentiment is up too.

Auction clearance rates have been rising, with Sydney reaching 68.2 per cent, and Melbourne 68.2 per cent in July, up from about 66 per cent in June. Last week, Melbourne hit 70 per cent and Sydney hit 75 per cent, according to Domain.

Clearance rates this high are often used as a real-time indicator of market performance – anything above 70 per cent is considered to signal conditions where prices are rising quickly.

Despite this, houses are sitting on the market longer – but it’s not because no one is buying. Rather, experts say, it’s because things are shifting so quickly that the data can’t keep up.

Ray White economist Nerida Conisbee says it’s likely these figures will reverse over the next few months.

“We’ve had three rate cuts, so you would think properties would be selling faster,” she says. “As we head into spring, if we don’t see a lot of stock enter the market, I think we’ll see days on market drop.

“In July we had a real shortage of stock – far [lower] than we had at the end of last year, when we had a lot of properties coming onto the market,”  she says. “Market conditions are changing quickly.”

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Conisbee adds it’s possible that vendors excited by the interest rate cuts and rising market could be pricing their homes too high, too early, which means they are sitting on the market for longer.

Domain’s data shows some of the capital-city regions that are taking the longest to sell are also some of the most expensive, like Sydney’s Pittwater and Manly regions.

Most of the fastest-selling regions in Australia are located in Brisbane and Sydney – areas such as Strathpine in Brisbane’s north, The Gap and Enoggera, Marrickville-Sydenham-Petersham in the inner west, and St Marys.

In Melbourne’s SA3 region of Stonnington East, which captures suburbs like Malvern, Malvern East and parts of Kooyong and Glen Iris, the time it takes to sell a house has fallen dramatically, from 77 days in July 2024 to 44 days in July 2025.

Michael Richardson of Fletchers Glen Iris says the market has picked up considerably.

“In six to eight weeks, we’ve seen a bit more of a spring in the step from a buyer’s point of view; they know if they buy now, [their mortgage repayments] won’t get more expensive because rates are coming down. It gives them confidence,” he says.

Buyers are also in a rush to beat the rising market, Richardson adds: “They’re starting to think, ‘Now is the time because I’m going to have increased competition very soon.’ ”

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Even still, homes that are overpriced will linger on the market. Richardson cites the example of a Hawthorn property he recently listed – which had been on the market for 10 months – and says he has had to give it a “$1 million price haircut”.

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“Great spot, brilliant address, 961 square meters of land and a beautiful period home,” he says. “But it sat there for 10 months because it was overpriced.”

Domain chief of research and economics Dr Nicola Powell says that while three interest rate cuts have very quickly increased consumer sentiment, it will take some time for these factors to show up in the data.

Auction clearance rates are usually a better indicator of what’s happening in real time, she says.

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“That shift in market dynamics can take a while to filter through, especially when we’re in a shifting market dynamic like we are now. The tide is turning,” Powell says.

“I would guess by the end of this year – if we see momentum continue, which I think we will – houses will be selling a lot faster.”

Sydney and Melbourne will lead the charge, she adds.

“Growth in the number of new homes on the market in Melbourne is plateauing,” Powell says. “We won’t see a flood of listings in Melbourne, and when we get a shortage of listings, that’s when we’ll see houses selling much faster.”

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She says the sale of lower-grade properties that may have sat on the market for a long time will speed up as dynamics change across the nation.

“Properties that may come with a couple of ‘warts’ will have been the ones that languished on the market,” Powell says, “but as competition heats up amid a shortage of stock, buyers will start considering those homes – warts and all.’