31st August 2021 / Prue Fletcher: 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 and gloom and economic experts like Cameron Kusher from Realestate.com.au and Eliza Owen from CoreLogic agree, reporting 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.

Over the last auction weekend of August, for example, five bidders competed via an online auction for the property at 45 Park Crescent in Kew. Presented in immaculately maintained, mostly original condition, the property boasts stunning beamed cathedral ceilings and a premier corner allotment that could lend itself to future redevelopment (STCA). Auctioneer Jeremy Desmier fielded just 20 bids during the half hour auction, before knocking it down at $1,650,000.

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 priced competitively and presented well are, in a lot of cases, seeing results above market value.

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 can work for you.

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.

45 Park Crescent, Kew

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. Fletchers average August clearance rate of 92% shows that no dream home stays on the market forever. While current industry auction clearances have been low, these are equally based on very low numbers of auctions as well as the confidence agents have in taking these homes to auction, and we will likely see these dip restrictions ease and we enter into a more balanced market.

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.

When to re-enter the market, whether buying or selling, has always been a delicate process. However, we have seen strong evidence over the past 1.5 years of this Pandemic that buyers and sellers alike have grown accustomed to remaining fluid in a selling environment, and those who have a strong game plan with their agents are still reaping significant rewards.