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Real estate markets still performing, despite Covid-19

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Samantha is a Sydney-based real estate and home improvement writer. She is currently Head of Marketing at OpenAgent.

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Far from the doom and gloom portrayed by the media, agents say that their local markets are still moving, despite Covid-19 and despite new imposed lockdown measures in Melbourne.

After the country was able to contain the initial spread of coronavirus, industry analysts and pundits began reporting on positive signs in the market as consumer sentiment started to rise, and the market started to build momentum.

And housing value drops have also been described by CoreLogic’s Head of Research Tim Lawless as ‘mild to date.’

What we always try to communicate is that any all-encompassing data point that looks at real estate markets at a national or state level should be taken with a grain of salt. Markets will behave differently from postcode to postcode, so while housing values may drop in one suburb, you might find that neighbouring suburbs are holding steady, or even exceeding expectations. 

Even in Victoria where lockdown measures have been reinstated, industry leaders are positive about the future, given the current performance of the market. 

According to Real Estate Institute of Victoria (REIV) President Leah Calnan, properties in Victoria are selling quicker now than they were 12 months ago. 

REIV’s latest data from June 2020 shows that the average Victorian home is spending 41 days on the market before being sold, down from 44 days in the same period last year. 

“There remains a huge interest from buyers despite the state undergoing restrictions due to the pandemic,” said Ms Calnan. 

“The REIV days on market figures, amongst a range of other measures, show that our state’s property market is holding strong and delivering great results across the board.”

The data also showed that homes in Metro Melbourne sold within 39 days on average, compared to 42 days a year ago. Melbourne’s suburb of Montrose in the city’s east provided the shortest turnaround in the state, where home’s sold within 14 days on average. 

“These figures provide great confidence to sellers that buyers are rapidly snapping up Victorian real estate,” said Ms Calnan.

Melbourne real estate agent David Moxon has echoed these sentiments, saying that buyers are still very prominent in the market. 

“The vendors that we see coming on understand the basics of supply and demand. They can see that there’s a relatively good volume of first home buyers in the marketplace, so they know they’re in a reasonable position because they’re not competing with tonnes of other houses on the market.”

“Since lockdown, we’ve been doing auctions online, and we’re getting an average of 2-4 registered buyers per auction, and given the lockdown, we’re still travelling at a clearance rate of 92%,” he said. 

These encouraging figures and anecdotes aren’t just coming from Victoria either. Sydneysiders who are considering selling would do well to speak to local agents to find out how their market is currently travelling. 

According to Brendan Fearn from boutique Sydney agency BresicWhitney, since Covid, defined real estate seasons have flown out the window. 

“What we’re seeing over the past couple of months as we’ve moved out of lockdown is it looks like the seasonality of the market has been removed by Covid.”

“Normally spring is a peak period in terms of selling, and June and July are quiet. This year, listing volumes have been high throughout June and July for us, and in line with what we see in spring months, and we’ve certainly seen that momentum carry through.”

“For us, listings and number of sales have hit the same level as spring 2019, which is very unusual and specific to 2020.”

“There is good momentum in the market in terms of sales volumes and activity. We’re seeing good attendance at opens and a good amount of buyers turning up as registered bidders at auctions.”

“We’re definitely seeing higher than usual listing volumes for this time of year,” he said. 

Mr Fearn says that transactions are going through at all ends of the market, with the BresicWhitney team seeing a high number of bidders from entry level all the way through to the premium end of the Sydney market. 

lilyfield property market
Recently BresicWhitney agents Andrew Liddell and Brandon Nguyen had 12 registered bidders for 82 Piper Street, Lilyfield, which sold for $3.17 million - $400,000 above reserve. Source: BresicWhitney.

“We’re still getting good attendance at opens and we track that on a weekly basis. We’ve been averaging over the past 60 days between 10-12 attendees for every open on every Saturday.”

This is a strong number, given that during the winter months, open home attendance usually drops. Mr Fearn says that during spring this number lifts to 15 attendees or more, so 10-12 during this time of year (and in the current climate) is strong. 

This isn’t just recent, either, according to Mr Fearn, even during the height of NSW lockdowns in April, there was still good buyer activity, indicating that those who had made a decision to purchase pre-Covid, are still moving forward with their plans. 

Daniel Ellem from Illawarra Estate Agents who services the Wollongong region says that from a sales point of view, the group has had the strongest results that they’ve seen in five years. 

“We’re doing well right now. From a sales point of view, we currently have 32 properties either under offer or under contract right now.”

“Things are definitely not slower. We’re low on listings, but that’s only because we have everything under offer,” he said. 

“I’ve just put a waterfront property on the market in Oak Flats a few days ago which is probably going to set a suburb record. In just three days we’ve had 26 enquiries.”

waterfront property oak flats
Daniel Ellem from Illawarra Estate Agents is getting a steady stream of enquiries for this waterfront property in Oak Flats. Source: IEA.

Informed by strong performance in the market, Mr Ellem is advising his clients in the Illawarra region to move forward with their selling plans. 

“I know what the market is doing right now, and we’re doing well. Sellers and buyers have adapted to what has happened.”

“We just don’t know what will happen in 6 months time, but right now the numbers that we’re turning over are really promising. There are buyers out there at all different price levels.”

“Yes, listings are lower right now, which is causing demand to be stronger than the supply, so vendors are still getting great prices,” he said. 

Mr Ellem says the team recently sold a 3 bedroom property with no backyard at 44 The Parkway, Balgownie for $950,000, which is a strong result for the area. 

For would-be sellers who are considering putting their properties on the market, agents generally agree that the lack of stock on the market could work to your advantage, given that buyers are still out there. 

Peter Georgiou from Raine and Horne Bardwell Park says it’s more advantageous to sell in isolation, rather than in a market flooded with competition. 

“You don’t know what’s around the corner, or when neighbouring properties are coming into the market, so if you’re ready to make the move, it’s best to do so now before similar properties list, giving buyers more choice,” he said. 

And according to Brendan Fearn from BresicWhitney, it’s important to be really considerate around price expectations. 

“Making sure that the property is priced competitively is really important, and that is reflected in the interest and attendance we see.”

“If a property is listed at a competitive price point, it gets good momentum early on. If it’s slightly overpriced, it lacks momentum,” he said. 

Mr Fearn says that for the most part, everyone has realistic expectations right now, and with those expectations in place, it’s easier to engage the market and get early momentum in a campaign to get sellers a great result.