2020 has thrown us some incredible challenges, to say the least. The impacts of COVID-19 are far-reaching and vary greatly across different industries and regions.
For the most part, Australia is resiliently gritting its teeth. And the property market is no different.
Whether you’re considering buying or just curious as to what’s going on, here’s an overview of what’s happening in the property market right now.
An uncertain but resilient outlook
You’d be forgiven for thinking the housing market may be wilting in response to Australia’s current economic woes. Parts of the media certainly predicted that’d be the case. But the country’s housing market has been pretty resolute and performed better than initially feared.
That said, there has been an understandably lower number of sales taking place as buyers and sellers alike have paused while the country responds to COVID-19 restrictions and economic instability.
So, much of the country’s housing market recovery is likely to come once the economy reopens and after confidence returns, buoying buyers and reassuring sellers.
If you’ve already entered the housing market, there could be golden opportunities to upgrade and continue to climb the property ladder. It all depends on your circumstances, as well as where you’re looking to sell or buy.
First home loans gain traction
There’s no doubt that 2020 has given many of us a year of firsts. In fact, unless you were around for the Spanish Flu a century ago COVID-19 has been your first introduction to a major, global pandemic (and we’re all hoping it’s our last).
In a year of firsts, for some, 2020 has presented an opportunity to break into the housing market.
Supported by record-low interest rates and stimulus measures - such as JobSeeker and JobKeeper and the First Home Loan Deposit Scheme - and reductions in costs like stamp duty, first home buyers are in a handy position to make their move.
For aspiring first home buyers with secure employment, now could be as good a time as any to enter the property market.
To find out more about the Scheme and when the next round opens, visit the National Housing Finance and Investment Corporation (NHFIC) website.
Smaller capitals capitalise
Once Victoria starts to recover from its second wave, we’ll get a better look at the nationwide market. However, early indications point to dips in house prices since March in Melbourne of around 4.5%, and Sydney around 2.5%.
Meanwhile, there are rises in the dwelling market for cities such as Canberra, Hobart, and Adelaide. These cities have felt less of the pandemic impact than their larger city counterparts of Sydney and Melbourne. And their growth reflects that.
And for Queensland, there’s been a continued influx of domestic migration with people making the switch to the sunny lifestyle, which is helping a healthy recovery that is even seeing some suburbs outperform in the downturn.
Regional areas rise
One trend that has caught the eye lately, is the increase in sales in regional Australia.
Like the capital cities, regional markets stumbled and suffered downturns in the wake of the pandemic. Hardly surprising given COVID-19’s track record at this point.
Analysis by CoreLogic points to regional housing markets coping far better than the capital cities with regional centres.
Illawarra has witnessed the biggest rise in property values. And elsewhere, Ballarat has seen quick sales with little drop-off in prices.
First home buyers may have also had a say in the recovery of regional areas as cheaper homes combined with government stimulus has inspired more property market debutants to head to regional areas, as well as the outer suburbs of major cities.
It’s a little early to tell if the well-performing housing market in regional Australia is part of a larger trend that will continue or a reflection of quicker regional recovery.
But COVID-19 has forced many of us to work from home. Proving that we don’t have to live in, or even near, a crowded capital city to operate a business or contribute to its success.
As the labour markets grow and Australia’s recovery begins, the success of regional Australia’s property market may have more context. But for now, it seems this trend is one to watch.
Readiness for recovery
Now could be a great time to get your life admin in order and start building a plan for your future.
Whether that’s renovating, building a rainy-day savings plan. Many people have taken the opportunity to reassess some of life’s more important admin areas.
The Australian property market is evolving all the time, so if you want to stay informed of the latest market trends and property news, you can sign up to our monthly Economic and Market Update.
Important information: This article contains general information only. The information contained in this article is current as at the date of publication and is subject to change without notice.
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