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  • 5 fears of lockdown selling - are they worth the worry?

5 fears of lockdown selling - are they worth the worry?

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As the start of spring approaches, much of Australia's East Coast remains deep in lockdown, while other states find themselves in a precarious position thanks to the highly contagious Delta strain of Covid. 

What's supposed to be the beginning of a huge property selling season has been derailed by the virus, as nervous vendors withdraw from the market in fear that restrictions will get in the way of a good selling result. 

A number of concerns keep popping up around the lockdown selling process, but just how worried should people be? We speak to top agents in Sydney and Melbourne about how they and their clients are navigating the lockdowns, and the positive results may surprise you. 

Fear #1: You can't get top dollar selling in lockdown

Among the greatest worries vendors are having about listing now is they'll miss out on getting the best price for their property. 

"I think it's incorrect, I think it's actually the other way around," says Max Klimenko of Ray White Touma Group in the inner-Sydney suburb of Redfern. 

"The thing at the moment is there are still buyers who are pre-approved, there are buyers that are hungry to secure a property. I think that we are actually getting better prices now."

Mr Klimenko expects, once the lockdown eases, a flood of properties coming onto the market will dilute the buyer pool and mean vendors won't hold the balance of power the way they currently do with stock so low.

"We tell our clients, you'd rather be selling in isolation than in competition," he says.

Paul Fenech, principal at McGrath Croydon in Melbourne, also says he doesn't fully agree with that sentiment. 

"The buyers that are really keen to buy property have maybe sold a property and they have to buy a property. So they're paying good dollars," he explains.

"Stock is low, so that's always going to drive prices up as well. I would certainly say the [properties] we've sold we've got some really good dollars for, and even the online auctions have been well received as well."

Fear #2: Buyers can't inspect your property

The severity of restrictions on inspections varies from state to state, and so the severity of this concern depends on where you live and what the government will permit. 

In NSW, where the rules are a bit more lax and one-on-one inspections can go ahead, Mr Klikenko explains "buyers are not restricted. If they've got a genuine reason that they need to move home, nothing's stopping them from looking at properties.

"We qualify buyers, buyers that are in a position to buy are taken through. If they're just browsing they don't get taken through the property. So it allows us to deal with good quality buyers." 

Max Klimenko, Ray White Touma Group
Max Klimenko, partner at Ray White Touma Group in Sydney's Redfern. 

Victoria's restrictions mean in-person inspections are off the cards for now, but Mr Fenech has seen that motivated buyers haven't been put off. 

"They can't inspect the homes, so they're driving past. We've emailed them existing photos that were online from when it sold previously. We email them the floorplan of the home and they're making an offer on the property subject to an inspection off that information."

He says that it's not uncommon for those buyers to put down a deposit on a property they want, and once they're able to come in for an in-person inspection they can move ahead with the transaction. 

Fear #3: You can't get your home staged and marketed properly

Again, the rules here differ from state to state, so it's best to speak to your agent to find out what can and can't be done in lockdown. 

Mr Klimenko notes that in NSW, while body corporates may present some hurdles in apartment and townhouse complexes, there are often ways to overcome those obstacles, and generally home stagers and trades are open for business. 

"Every company you're dealing with has got to have a Covid-safe plan, they've got to be able to prove it and show exactly how they're using it."

A number of the properties he's listed have undergone staging, painting and other repairs throughout the lockdown, and it's something he believes is still very important. 

For difficult strata companies, he says "if you can try everything you can to explain that this is an essential service," often they will be receptive. 

Again, with Victoria's stricter lockdowns, those services aren't currently available, but Mr Fenech says his clients have been able to take their own photos and push the listings online to give buyers a better sense of the space, and that's proving to aid the process. 

He explains that most of his vendors feel that, once that's done, "if you can get some enquiries and let people drive past, and then the minute we get out of lockdown and show them through, we're happy with that."

Fear #4: Online auctions don't deliver top results

The response to move things into the virtual realm has some people worried that some of the in-person auction energy might be lost, but both agents have seen online auctions deliver big sales. 

"Online auctions are still doing incredibly well," Mr Klimenko says. "Look at the last two weeks of auction results, they're almost 10 per cent higher than pre-Covid. We're hitting around 80 to 85 per cent clearance rates on online auctions.

"I think if you've got the type of property that's generating a lot of interest, you'd be silly not to run to auction."

He also points out that the campaign is "like a private treaty every day until the auction day, so there's a good opportunity to sell beforehand." Plenty of properties are being sold thanks to strong prior offers, and that's working in vendors' favours. 

Mr Fenech agrees that "a good property will sell in any market in any fashion."

Paul Fenech, McGrath Croydon
Paul Fenech, Principal at McGrath in the Melbourne suburb of Croydon.

He recently had a great result with 4 Yarndi Close in Croydon North. "We had 13 registered bidders, we had it promoted from $1.25 to $1.35 million, and it sold for $1.522 million, so well over reserve."

He believes that if a buyer really wants a property, they're going to compete for it no matter what the sale format is. 

Fear #5: Buyers have been put off the market

Buying and selling activity has indeed seen a drop since the latest lockdowns were instated, but that doesn't mean there aren't plenty of fiercely motivated buyers out there ready to pounce. 

Mr Klimenko says "we're finding now a lot of the apartment owners who are ready to make the next journey, they're ready to upsize and get a bigger family home, and they're struggling. The competition is very, very heavy."

Demand has indeed dropped, but stock has dropped even more significantly, meaning the net impact is that there are even more buyers out there per listed home.

"We're not seeing great stock levels, they'd be down about 30 per cent compared to last year," he says. "And that's why, if you've got an A-grade asset, you'd be silly not to go to market now."

Mr Fenech is also aware of a plethora of impatient buyers out there, saying, "everyone's sitting at home waiting on their iPads for new listings. If I could show the homes today I'd have people queueing at the door.

"We're saying to people, if they want to sell, there's no time like the present. As in, at least get your home listed, and then we can bound into action once the lockdown's over."