What will COVID-19 mean for property prices?
Coronavirus has brought widespread upheaval and uncertainty to most sectors of the Australian economy and the property market is no exception.
With life interrupted for millions across the country, the knock-on effect to people’s plans to buy or sell has naturally been significant. With incomes reduced or under threat in many households, people are putting their housing plans on hold until the future becomes more certain. Even those willing to push ahead have seen their plans forced to a halt, after auctions and in-person inspections were banned, as Stage 4 restrictions came in to place in Melbourne in August.
The question is: When we get to the other side of the crisis, will we see pent up demand drive prices back up or consumer confidence so low that markets take years to recover? With plenty of media noise at both ends of this question, we turned to property expert and FMD partner, David McMillan at Performance Property, to get his insights on the current impacts of the pandemic and what we can expect from property markets as we emerge from the crisis.
David’s research team has crunched the numbers on the key factors that need to be considered when assessing the property outlook across the country in the wake of COVID-19. From supply and demand drivers, to the low cost of borrowing, the impact of economic stimulus measures, as well as immigration and mobility issues, and where to find the best growth opportunities. David’s findings challenge much of the recent market commentary, so we’ve asked him to join us to share his insights with FMD clients via an interactive webinar on Friday, 11 September.
Look out for your invite in your inbox soon! Here is a quick Q &A with David to give you a sneak preview of some of the insights he’ll share at our upcoming webinar.
There is so much doom and gloom about property in the media. Why do you think that is and what does your research tell you about the outlook?
In my experience, the media generally misrepresents property and now is no different. Our research tells us it is highly likely we’re going to see prices rise in the short term. I’ll take you through some of the reasons why in our webinar.
What is the biggest myth or inaccuracy being circulated about property right now?
By far the biggest myth doing the rounds is that ‘prices will definitely fall, it’s just a matter of how much.’ We know for sure that some markets are rising right now, so that simply isn’t true.
People are understandably feeling somewhat insecure and pessimistic. What reason can you give them to feel positive about the outlook for property?
People can take comfort in the knowledge that property prices have increased after the last five recessions we’ve had in Australia. In fact, the year after the GFC, property prices rose 20% in Melbourne and Sydney, so there are plenty of good news stories. The most important thing is that during this very chaotic time, people are making the right decisions, based on facts and good data. The answer isn’t to put your property plans on hold, but instead to ensure your strategy takes into account the drivers behind the current and future outlook.
That’s what I’ll take you through on our upcoming webinar: Australian Property Market Update at midday on Friday, 11 September.
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