Property news you need to know: The week ending 19 September
Smart Property Investment is pleased to present a weekly round-up of the biggest stories across property, investment, re...
The Greater Sydney lockdown will continue for another four weeks, at least, meaning auctions will remain in the online setting, but construction is set to recommence at the end of this week.
The Berejiklian government has announced what most have anticipated – a four-week extension of the current public health orders, confining millions of Sydneysiders to their homes for another month.
As such, auctions will remain exclusively online, interrupting the environment for both agents and consumers.
Speaking to Smart Property Investment’s sister brand, REB, CoreLogic head of research Eliza Owen explained that while the extended lockdown has led to lower auction volumes, the real estate sector has developed tools to ensure the continuance of business.
“I do think agents became a little more discerning about the auction campaigns they think are going to work in lockdown conditions,” Ms Owen noted.
“Ultimately, the market has seen a period of catch-up coming out of lockdowns,” she highlighted.
However, supply is expected to be impacted.
As was the case with previous lockdowns, the lack of mobility putting a strain on supply is likely to increase the imbalance between supply and demand.
“It is a supply issue that has exacerbated price gains,” Ms Owen told REB.
InvestorKit’s Arjun Paliwal shares Ms Owen’s confidence.
“The industry has been there before and will display much the same this time around,” Mr Arjun said.
While the number of people forced to sell during the tough times may increase, those that aren’t in a rush will likely hold off, Mr Arjun noted.
“For that reason, I don’t see a large-scale impact occurring. Should this go on and on, we may see a shift to a different story.”
As for property investors gearing up to buy, Atlas Property Group’s director, Lachlan Vidler, said this could be a “golden opportunity to ask agents to tap their database of buyers and buyer’s agents for quick off- or pre-market transactions as there is still significant demand for quality property”.
“While things may look a little more damp than a few weeks ago, there are still great opportunities for buyers to find better-than-average deals because of motivated sellers. And for sellers to achieve great sales results from buyers who are emotionally drained from the current red hot market and may be willing to give big ‘knock-out’ offers on off or pre-market properties,” said Mr Vidler.
Moratorium on evictions
Mid-July, property investors took a slight hit with the reinstatement of the moratorium on evictions. And although they were promised a rebate or discount in relation to land tax payable for any rent reductions their offered their tenants, many argued that the support was inadequate.
“I think that landlords have disproportionately worn the negative impact of eviction moratoriums,” Mr Vidler told Smart Property Investment at the time.
As of Wednesday, the moratorium to restrict when landlords can evict tenants due to rental arrears is in place until 11 September 2021. Whether this date will be extended is not yet known.
In fact, the only real change to existing lockdown rules is the resumption of “unoccupied” construction, which is due to resume from Saturday, provided sites have approved COVID-safety plans.
“Construction will resume on Saturday, 31 July, with safety measures such as controls on movements between sites, reduced contact between workers within sites, improved tracing capability and a focus on encouraging workers to get vaccinated,” Deputy Premier John Barilaro said.
Worksites will also be able to operate on Sundays and public holidays for the remainder of the year, up until Christmas, to make up for any time lost.
Tradies too will be allowed to visit homes if they can ensure no contact is had with anyone while they are working. This, however, will not apply to the eight hotspot areas.
Prior to the lockdown’s extension, real estate industry experts said that Sydney’s lockdown will be a little more than a speed bump for a hot housing market.
Paul Ryan, an economist at the RealEstate.com.au, earlier explained that while housing sales are expected to fall, the Melbourne experience has suggested that sales do recover strongly as the outbreak is brought under control.
In fact, sales quickly surged to almost twice the pre-outbreak level after restrictions were lifted, making up for the slow lockdown period.