Will Sydney’s property market slowdown amid lockdown?
The Australian property market has had an exceptionally strong run in 2021, but could Sydney’s latest lockdown see its bubble burst?
Sydney has been the fastest-growing major market in the country for the calendar year so far, with property prices up by 8.2 per cent in the last quarter and 15 per cent in the last year, according to CoreLogic data.
A combination of record low interest rates, government stimulus and strong buyer demand has helped drive dramatic price increases in Sydney, and across much of the country, but many have speculated that price rises will start to slow down soon.
So, could the latest lockdown in Sydney give buyers the reprieve they’ve been looking for?
What effect will lockdown have?
While some people may be hoping that a lockdown is a time to snare a bargain, previous lockdowns have shown that that is unlikely to be the case.
An analysis by CoreLogic has found that while you may get a drop in buyer demand during a lockdown period, there is also a drop in supply as sellers hold out on putting their homes on the market to see how things pan out.
So while transaction activity does tend to slow, property prices remain stable. Previous lockdowns have also demonstrated that the market likes to play ‘catch-up’ when restrictions ease.
Previous lockdowns have had government stimulus and institutional support that has also helped the property market remain resilient, and it’s hoped that the financial packages currently on offer from the federal and state governments will be helpful again in this regard, along with relief deals offered by Australia’s major banks.
What should buyers and sellers do during a lockdown?
If you’re a buyer then one of the biggest issues you might face is the ability to view properties that are for sale. Properties may still be snatched up quickly in lockdown periods so if you can’t view a property in person when you need to then of course there is a chance you could miss out on it.
If you feel confident making a purchase sight unseen however then don’t hesitate to get the agent to offer a video walkthrough of the property or find other ways to do your due diligence before making any offers.
For sellers, you will need to decide whether to continue with a property sale during lockdown or hold off until restrictions have eased. It’s best to discuss this with your listing agent as to the best options for your particular situation.
If a property has a lot of interested buyers lined up then postponing its sale may not be necessary, but every property is different and it may depend also on how quickly you want the sale to take place.
