Melbourne’s property market is staring down the barrel of spending a second spring selling season in lockdown, as restrictions aimed at stopping the spread of COVID-19 are extended into what’s usually the busiest time of year in real estate.
Under the restrictions, in-person inspections and public auctions have been banned, and its impact on the market has already taken hold.
Buyers and sellers are withdrawing from the market in large numbers, despite record house prices being reached in some online auctions.
Property listings in Melbourne have fallen by 17.3 per cent over the past four weeks and agents say that’s likely to worsen coming into the spring months. The clearance rate has plummeted, falling to 47.1 per cent last weekend, while 368 properties were withdrawn from auction.
“Not being able to physically inspect a property has had a dramatic impact on the market – not many people buy a home sight-unseen,” Domain chief of research and economics Nicola Powell said.
The spring season is shaping up to be a repeat of last year’s, Dr Powell said, when Melbourne’s new listings plunged by 71 per cent in August 2020, Domain data showed.
Sydney’s property market has remained buoyant despite its protracted lockdown and high case numbers – last weekend’s clearance rate was a massive 85.2 per cent – because in-person inspections have been allowed the entire time.
Once the market does reopen, experts expect the market to snap back as quickly as it did last year when the pent up demand fuelled a flurry of sales.
ANZ senior economist Felicity Emmett said she expected prices would continue to grow throughout spring, though at a slower pace, just as they had in 2020.