30th September 2020 / Sarah Lowry: Your Quarterly Market Update for Spring

After facing a long period of time under restrictive Stage 4 lockdown conditions, Melbourne's property market and its residents are well and truly ready to come out of hibernation. As we move into the Spring selling season and COVID-19 restrictions ease, we expect to see many sellers who delayed listing their homes to come onto the market.

Domain analyst, Dr Nicola Powell, noted that the pullback in listings since the announcement of Stage 4 restrictions has helped to support property prices. Whilst it has been an extremely challenging time for both businesses and families, REA Chief Economist, Nerida Conisbee, observed that the current activity shows that people see this lockdown 'more as business as usual and that there is a timeframe for it and they will get through it'.

Our experience after the first lockdown and what we have learnt from our industry peers in New Zealand tells us that we can expect to see an influx of property hitting the market once restrictions ease. We are encouraging those clients who would like to sell in Spring 2020 to prepare their properties as soon as possible and to contact their Fletchers agent to discuss a marketing strategy and approach, to take advantage of strong, pent up buyer demand.

Buyer insights from both Domain and REA show that buyer activity has remained strong throughout the lockdown period. REA data showed a unique audience of 12 million users to their site in July 2020, whilst Domain reports an increase in enquiry across the board, year on year, showing that Domain users remain highly engaged. Both portals also report that buyers and sellers have embraced technology, with an increase in the use of digital tools such as video and 3D virtual tours to assist with transactions.

In addition to changing the way that we transact real estate, the impact of the COVID-19 pandemic has forced us to assess our daily lives: from the way we work, to how we connect with each other, and even how we entertain ourselves. The way we use our homes has changed in 2020, and perhaps will continue to have an impact on our purchasing decisions and property wish lists. For example, the proximity of our home to our workplace, childcare and schooling has traditionally been a crucial factor when it comes to purchasing a home. With the majority of Melburnians effectively working from home for most of 2020, it seems likely that this will be a feature of our working lives into the future.

The Domain Group reports that behavioural searches reflect that home buyers are already seeking different home amenities. Prior to the pandemic, the use of "home office" as a search term was infrequent, but in the midst of the COVID-19 pandemic, it has soared in popularity - by 605 per cent in the June quarter compared to the March quarter.

In the rental market, the REIV reports that Victoria's vacancy rate rose to 2.9 per cent in July 2020. Regional Victoria has fared better than its metropolitan counterpart, with the weekly median rent for houses remaining steady for seven consecutive weeks. With search and enquiry levels also showing significant increases on the major portals despite the lockdown, we hope to see the increase in vacancy rate reverse as we move into the last quarter of the year.

We encourage you to keep up-to-date on the market, wherever possible. If you would like a price estimate on your home, please get in touch with your local Fletchers agent to discuss.

Despite the trying times that we have found ourselves in over the last six months, we do know that Victorians are a resilient group of people. At Fletchers, we would certainly like to support the community in any way that we can.

We hope that you stay safe and well as we continue to navigate our way into the "new normal" of our lives.