New figures showing the number of listings of homes for sale has hit its lowest level in three years.

SQM Research figures show new home listings dropped 19.6% over January.

Managing director Louis Christopher says January is traditionally a quiet time for listings but the numbers are down for this period.

“It is no surprise we recorded a fall in activity over this month – however, there’s also a steep drop of 13.8% in new listings nationwide compared to a year ago,” he says.

Christopher says owners who think it’s a bad time to sell are holding off from listing in the hopes of a market recovery.

“Many vendors don’t have the need to sell, so even if it’s a buyers’ market, there are fewer options and there’s more competition for those that are listed for sale,” Christopher says.

In the past year new listings have dropped by 28% in Melbourne, 20.5% in Sydney, 19% in Perth and 13% in Brisbane.