Spring, one of the busiest times of the year for the property market. Unless, of course, you currently reside on the Australian East Coast, where Australia’s biggest property markets of Sydney and Melbourne find themselves facing a COVID-induced delay to the peak selling season.
With restrictions in NSW, Victoria, and the ACT still in place for a little while longer, the usual spring time rush will be running at different speeds across Australia. The supply of properties for sale is likely to come later into the season, depending on the length of lockdowns.
There is still undoubtedly strong buyer demand for properties in the current market through lockdown, and with such high competition for what little there is on the market, the scales are ever-tipped in the sellers favour. In spite of this, many are still concerned about lockdown conditions making the selling process too difficult (and understandably so!)
We’ve covered the top 3 worries that home owners might have about selling a home in lockdown - and the answers might surprise you!
1. I won’t be able to get a good price selling in lockdown
Although you may be hearing this quite often by now, the market data available continues to show unchanging patterns in this dynamic - there is still a large number of eager buyers who are competing for a small pool of properties, thereby pushing home prices higher!
As home prices continue to rise across Australia, properties available for sale are continuing to dwindle - even while activity is restricted in lockdown - due to both a lack of new stock available, and older stock selling.
The latest Corelogic monthly insights for September show that in the 12 months to August, home sales are tracking 40% above the five year average, while active listings remain -26% below the five year average.
In a separate report by CoreLogic which delves into how the Australian housing market is faring through lockdowns in 2021, it was found that Sydney auction results have remained high through lockdown conditions. Since the week starting 28th of June, when a city-wide lockdown was in place, the auction clearance rate has averaged 75.9% through to late August. The volume of properties clearing at auction have averaged 474 per week, which is actually the highest average of weekly auction sales for the period since 2015.
We’re seeing a different market in Melbourne, with heavier restrictions on buyers who are not allowed to inspect property in person. However, when looking at just the number of properties sold at auction each week, there have actually been a higher number of successful auction results across Melbourne than in Sydney for eight of the past nine weeks. The clearance rate across Melbourne is likely to ‘normalise’ as a smaller number of properties are scheduled for sale in the coming weeks.
At Upside, we continued to see properties achieve stand-out results during this time, with sales taking place completely virtually, from home inspections to online auctions!
2. Buyers have been scared off by the lockdowns and not interested
Although there has no doubt been a drop in activity, the stock of homes for sale has dropped even more, meaning that demand still outstrips supply.
The latest REA Insights Housing Market Indicators Report showed demand, based on the number of views per listing of properties for sale on realestate.com.au, hit an all-time high in August, ahead of a delayed spring selling season in locked-down markets. Weekly search volumes for properties for sale rose by 1.8% nationally last week to be 17.6% higher year-on-year. Search volumes reached record highs in Queensland, South Australia and the NT, while locked-down NSW had the strongest rise in buyer searches with a 5.2% rise.
The volume of email enquiries to real estate agents on realestate.com.au also reached a new high in August after a 12.2% monthly increase, which makes sense with the restrictions on seeing a property in person in some states.
3. Buyers can’t inspect my property and I can’t put my home on the market right now because of restrictions
Currently, each state in lockdown has their own varying degrees of restrictions when it comes to a buyer inspecting a property.
In NSW and even Greater Sydney where restrictions are stricter, genuine buyers are still allowed to inspect property via a booked one-on-one appointment.
One major upside to this, no matter your location, is that within the additional hurdles a buyer needs to navigate in order to buy a property right now should signify that they are genuine, and good quality.
It is also important to remember that selling a house doesn’t happen overnight, and the lifting of lockdown is anticipated to set off a frenzied spring rush from pent-up supply. This means that there could be a bottleneck of services such as home photography and styling, as well as an increase in competition as others rush to the market.
If you’re thinking of selling a home, there is no time like the present to talk to your local real estate agent to set out the selling timeline and decide on your campaign approach.
COVID-19 is looking likely to overstay its welcome for some time to come, and state leaders have indicated that a locking down of suburbs is still a possible tactic to combat any future outbreaks. The threat of an imminent lockdown will never really go away, but luckily home sellers can aid potential buyers who are wanting to inspect their home through digital tools such as floor plans and virtual tours.