19 March 2020

How Will Coronavirus (COVID 19) Affect the Property Market?

Coronavirus (COVID-19) is dominating the news and the lives of every human being on the planet at the moment. We would like to take this opportunity to let you know that the safety and wellbeing of our clients, staff and everyone we come into contact with on a daily basis is our top priority. We will continue to show and sell properties during this time, however have implemented a range of measures to keep our communities safe. These include:

  • No physical contact such as hand shaking;
  • All sales agents to uphold a strict hygiene regimen such as regular hand sanitisation;
  • Set up of sanitiser stations at the entrance to open homes for use by all visitors;
  • Increased private inspections;
  • Supplying of masks where requested;
  • Screening of all visitors to an open home to ensure they are well, and have not been exposed to the virus in any way;
  • If any of our staff are unwell they will not be permitted to come to work.

These changes will ensure that we play our part in the global responsibility to reduce the speed and spread of the Coronavirus (COVID-19) to ensure our healthcare system is not overloaded.

How will this pandemic affect the property market?

The Sydney property market has demonstrated its resilience to economic downturns before, such as during the GFC. The stock market crash combined with high interest rates didn’t have a major impact on the property market then, so why would it now? Interest rates are the lowest they have ever been which equals increased buyer activity and the volatility of the stock market has many turning to property as a safer and more trusted investment.

A good indicator of the health of the Sydney property market are Auction clearance rates. Last week saw a clearance rate of 74.6% with 749 Auctions, compared with just 54.2% clearance from 638 properties auctioned this time last year. Yes, clearance rates are trending down slightly however are currently at a level that implies we are still in a seller’s market.

In the immediate term, we may see less properties coming onto the market as sellers hold tight waiting to see how things play out with the Coronavirus which may affect clearance rates over the coming weeks. However once this crisis is over (and it will be), life will go back to normal and I guarantee there will be a flood of property come onto the market.

For buyers, although it might be quieter than usual, there are still plenty of properties for sale at the moment, so it would be wise to make the most of the decrease in competition. Once life gets back to normal, there will be a stampede of buyers back onto the market and it will not be so easy to secure that property you’ve fallen in love with.

These are extraordinary times we’re living in. We all need to be there for each other, support one another and be responsible. If we can be compassionate, mindful and stay positive, we will all get through this together.

Be safe!

Dave Watkins & the djw property team.