The extended Stage 4 lockdown in Victoria will be casting some concern among homeowners about the value of their property, especially as we should be enjoying boom prices in the spring selling season.
But it’s essential that everyone takes the long-term view.
Property in Melbourne was enjoying record capital growth until the pandemic hit back in March. And despite so-called doomsayers telling us the market will collapse, nothing of the sort has happened more than six months later.
Prices were very strong in 2019 and the during first months of this year, Melbourne property is still showing growth in value of 5.9%, according to industry researcher CoreLogic.
As an experienced real estate agent in our area, I’m not going to pretend it didn’t dip 3.5% in the last quarter, or that August saw a 1.2% drop, but these figures are not sufficient to cause panic.
In the lead up to the first Covid lockdown, the market stayed in positive territory, growing 1.4% in the 12 weeks ending April 30. This result gave the city an annual year-on-year increase in property value of 12.4% – a strong result beaten only by Sydney and Darwin.
The second Stage 4 lockdown in Victoria has caused the market to slow considerably because it made it impossible to physically inspect properties. The “road out”, announced recently by the Premier, remains a challenge as we cannot organise inspections until infection levels drop significantly. Only 38 properties in Victoria went to auction in the first week of September, while in Sydney they were doing 600+ with a 70% clearance rate.
Those days will return to Victoria.
During the initial lockdown, we saw plenty of activity when clients used 3D walk-throughs, video tours and online auctions to buy and sell. But these last few weeks, with higher infection tolls, have had an understandably dampening effect.
Since the pandemic, Melbourne property has fallen 4.6% – a total that can be recovered in just a few weekends once we reach the end of the Premier’s “road out”.
Right now, sellers and buyers alike are going to miss the traditional spring selling season for property. Still, I am confident that the undoubted pent-up demand that exists in Victoria will emerge in November and we can move on with our lives.