The property market, like other sectors of our economy, has felt the impact of COVID-19, but it is far from down and out.
Prices held well throughout the shutdown considering the uncertainty that our society confronts. A poll by industry researcher CoreLogic suggests agents have been experiencing falls in buying and selling inquiries of around 50 per cent. While that’s an abrupt shift, it’s fair to say people are still buying and selling property.
New digital platforms allow sales to continue
Agents have changed overnight the way properties are marketed, embracing more digital engagement because virus-related rules stipulated no gatherings of more than two people.
Video tours and virtual tours of homes are becoming popular, and agents are always available to conduct in-person visits of a property with limited access as long social distancing etiquette is maintained.
Auctions have changed, too. They’ve gone largely online, using specialist platforms. They’re proving so popular that this form of sale will be used to complement physical auctions now that lockdown rules are easing.
Buying opportunities still exist
Prices are predicted to ease over the next few months but maybe propped up by several factors. If sellers pull out of the market in big numbers, scarcity will become a positive pricing factor. Additionally, we are seeing stock market investors move cash into property, and foreign buyers take advantage of a low Aussie dollar. The Reserve Bank has dropped interest rates to record lows, too.
Prices are relative
It’s important to remember that prices are relative and don’t affect only your property. If you’ve been thinking about moving up the property ladder, and you think your job is safe, then some excellent buying opportunities will exist for you.
Or, if you are considering an off-the-plan purchase, then you’re going to be in the box seat with developers, who’ll have committed millions of dollars to their project and be anxious about their immediate future.
Investors may exit if rents not paid
How landlords and tenants would sort out rent payments has been an area of anxiety for everyone. But in the vast majority of cases problems have been solved and compromise found. If rents had gone unpaid for whatever reason, many investors would have rushed to offload property. That hasn’t happened.
In capital cities, especially Sydney and Melbourne, there has been downward pressure on rents for months, and the situation is unlikely to improve during the COVID-19 crisis. The inner-city areas are seeing 20%+ growth in new listings compared with last year, so that’s dampening rent levels.
Resist short-term thinking: this crisis will end
While the virus feels never-ending right now, the crisis will pass. The property market will continue to transact, albeit at diminished volumes. There’ll always be people who need to sell their home for whatever reason.
As best as you can, don’t be caught up in the moment and consider the long-term impact of your decisions. Many economists are already predicting a sharp economic recovery next year, and that will drive the market forward.
