6 factors influencing buyers and sellers in extended Victoria lockdown
Like many Victorians, we had been hoping the so-called “road out” of lockdown might have been a little shorter.
As experienced real estate agents in your area, the pandemic has challenged our agency to provide new technologies and approaches to help you focus on your desire to upsize, downsize or buy your very first home.
Innovations such as 3D walk-throughs, video-based inspections and online auctions have ensured that the real estate market in our area has kept transacting despite all the demands of a lockdown.
Clients have also asked about the prospect of house prices falling, which you may have seen in the media. We don’t buy into this doom saying and economic experts like Cameron Kusher from Realestate.com.au and Eliza Owen from CoreLogic have both reported that the data shows that despite lockdowns significantly affecting the volume of properties currently for sale, the market fundamentals in Victoria are still strong, and the recovery is likely to be very strong.
We also take comfort from the property markets in the US and UK – both hit harder than us by Covid – are powering ahead.
For those wondering where to go from here, we’ve compiled factors that might influence your thinking. We welcome the opportunity to discuss these points or any other questions you might have, as you plan your future amid the continuing lockdown.
Opportunity to make a value-based purchase
No matter what the circumstance, the property market is always going to transact. There are still going to be value-based purchases and unique properties that will not stay on the market forever, waiting for you. Properties that are well priced and presented are selling.
Everyone’s adapting to this new world
Video inspections and online auctions are not phasing genuine buyers. In fact, they are proving remarkably popular because of the suspension of open houses and old school auctions. Whether you’re buying or selling, talk to your agent about how these options work.
Time-wasters are gone, only genuine buyers out there
The volume of transactions across the country is evidence of this. We are seeing buyers in the market, and they are genuine in their intent. The tyre-kickers are gone, and that works well for sellers who are only ever going to sell to a genuine buyer, anyway.
Lower interest rates a boost
The low interest rate to boost economic activity means that buying and selling property is now more affordable than before the virus struck our communities. Interest rates have always influenced buyer sentiment in Australia, and they continue to do so.
Auction successes suggest your next dream home won’t be on the market forever
Choosing when to re-enter the market is a tricky business. Clearance rates from auctions of more than 50 per cent during the early weeks of virus impact suggest no dream home stays on the market forever. While recent auction clearances have been low, these are equally based on very low numbers of auctions and these numbers will rise considerably as the restrictions ease. As the old saying goes, ‘if you snooze, you lose’. So if you have your heart set on your next property, then you should assess your options carefully.
Low exchange rates likely to attract foreign buyers again
We’ve seen the Aussie dollar drop against some important currencies, mostly the dollars of the US, Singapore and Hong Kong – traditional buyer centres for Australian property. Buyer agents are now scouring our market for great deals on behalf of overseas buyers. Americans, for example, have a built-in discount of almost 40 per cent compared with a few years ago due to currency. Like New Zealand, Australia has a reputation of a safe haven among many overseas buyers. While the 5km rule is restricting traditional buyers, overseas buyers are more comfortable with virtual tours and inspections.
If you’re still thinking of delaying your move due to Covid, you should consider the delicate art of choosing when to re-enter the market. There are countless studies on this, and they show time and again that people get it wrong and pay the price. As Covid restrictions ease as we head towards the end of the year, the market is likely to come back with a whoosh. So, if you have set your heart on your next home, consider the above factors and take action now.