Lockdown Over – Buyers are Ravenous!
After 112 days of living through the second, official pandemic lockdown, Melbournians responded with much excitement at being let loose at the end of October, and it seems the real estate market has sprung back with similar enthusiasm!
On Saturday 24th October, there were 198 Auction sales recorded by Real Estate.com for Victoria. The following Saturday, just a few days after lockdown ended, this number jumped to 362. Early reports from many agents indicate buyers are scrambling and eager to secure something before the Christmas break, with many wanting to settle before the holidays so they can use the time off to move in or make alterations to their new purchase. In an increasing number of cases, buyers have been prepared to bid well over the vendor’s reserve, creating feverish competition to secure unique properties, those in sought-after locations or with strong potential for capital growth.
From a lending perspective, banks are ready to take on the expected influx of applications, with many borrowers being smart and making sure they are pre-approved prior to going out, bidding and signing on the dotted line. Interest rates have never been at the historically-low levels we are currently experiencing so affordability is evident. The only question with affordability is whether this will create an unrealistic increase in property values as a result of buyers pushing prices higher at auctions in the pursuit of securing a property!
So, as we all start getting used to a new kind of normal in getting around and doing our usual everyday things post-COVID lockdown, only time will tell what the long -term effects (if any) the COVID period will have on real estate values. The doomsayers are all suggesting a 20-30 percent drop in median values across the board, however we are yet to see any solid evidence of this, especially in Melbourne’s inner city-middle ring areas. Tell us where values are dropping by that much as we want to beat the rush!
The ongoing pressure on the RBA to reduce the cash rate seems to have worked this month, regardless of the fact they made it very clear months ago that they will not be reducing the cash rate further and that any stimulus needed to come from the government. We now wait to see how much of the 15 points is passed on to borrowers. So, if you are in the market to buy property and find something right, don’t wait! Keen buyers ready to purchase are welcome to call on 0438 041 111 or email on email@example.com for a confidential discussion and assistance with tailored home loan options.
Please enjoy our articles this month … riveting reading for all!
As always, enjoy life, work hard, play safe and remember that we are always here to help you
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All the Best
Peter Vinci - 0438 041 111