April sees a decrease in new property listings #Brisbane recorded the highest decline in house prices of 1.0 percent over the month, followed by Perth 0.9 percent, Hobart 0.7 percent, and Canberra 0.1 percent decline in house prices.

Brisbane recorded the highest decline in house prices of 1.0 percent over the month, followed by Perth 0.9 percent, Hobart 0.7 percent, and Canberra 0.1 percent decline in house prices.

At a Glance:

  • National residential property listings decreased by 4.9 percent over April
  • Listing are down 11.9 percent from 12 months ago
  • Canberra was the only city that had an increase of listings at 0.4 percent

SQM Research has released figures this week to show that national residential property listings decreased over April by 4.9 percent from 307,847 listings in March to 292,775.

Compared to 12 months ago, listings were down by 11.9 percent.

“All capital cities experienced decreases in property listings over the month except for Canberra which posted a marginal 0.4 percent increase,” said SQM Research founder, Louis Christopher.

“The largest decrease was in Perth with an 8.4 percent decrease, followed by Sydney at 7.2 percent, and Adelaide and Darwin both posted a 6.0 percent decrease in property listings.

“Hobart had the smallest decrease of 4.3 percent in listings.”

Louis Christopher said year-on-year listings show more significant declines for all capital cities with Sydney recording a decline of 19.4 percent, followed by Darwin with a 17.7 percent decline and Perth a 17.4 percent decline this time last year.

“We confirm there was a large fall in new listings recorded over the course of April which impacted every capital city,” said Louis.

“We also note the surge in older listings, particularly for properties that have been on the market between 30 to 60 days.

Source: SQM Research

“This tells me that sellers struggled to sell their properties over April and new sellers deferred listing.”

The housing market has clearly been weakened by the coronavirus and the restrictions placed on the economy to limit the outbreak.

With the lifting some restrictions over the course of May, Louis Christopher said we could see a lift in buyer activity for housing; however many issues persist such as the spike in unemployment and the ongoing closure of the international border.

Asking Prices 

SQM Research went further reporting on capital city asking prices which increased by 0.7 percent for houses and increased 0.1 percent for units, over the month to 5th May 2020.

Unit asking prices are now at $574,900 and houses $994,300.

Compared to a year ago, the capital city asking prices posted increases of 9.4 percent for houses and a 3.0 percent increase for units.

At a Glance:

  • Increase in capital city property prices with house up by 0.7 percent and units by 0.1 percent.
  • Perth, Canberra, and Hobart recorded declines in asking prices for both houses and units
  • Melbourne, Adelaide, and Darwin recorded increases in both house and unit prices

Over the month, some capital cities recorded marginal asking price increases, with the exception of Perth, Canberra, and Hobart which all recorded declines for both houses and units.

Brisbane recorded the highest decline in house prices of 1.0 percent over the month, followed by Perth 0.9 percent, Hobart 0.7 percent, and Canberra 0.1 percent decline in house prices.

Unit prices declined in Sydney by 0.6 percent, Perth 0.5 percent, Hobart 0.3 percent, and Canberra 0.1 percent.

Melbourne, Adelaide, and Darwin were the only capital cities to record increases in both house and unit prices.

Strongest monthly growth was seen in Sydney house prices with a 1.1 percent increase and Melbourne’s unit market which saw a 1.0 percent increase.

Year on year, it was only Perth and Darwin that experienced declines in house and unit prices.

All other capital cities showed some strong growth this time last year where house prices rose 12.4 percent in Sydney, 11.2 percent in Melbourne, and 12.0 percent in Hobart.

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Which rental markets are most impacted by COVID-19?

As the far-reaching impacts of COVID-19 and the ensuing economic shutdown continue to be felt, the Australian property industry is still grappling with what it all means.

Across the board, the consensus has been that property, like most industries, will feel the impact of the unprecedented social distancing measures and economic slowdown – but some sectors of the market will be hit harder than others.

The heads of the state’s Real Estate Industry bodies have all had their say in response to Ripehouse Advisory’s Whitepaper COVID-19 vs Australian Property and most are on the same page, being cautiously optimistic.

Yield doesn’t always compensate for the risk

President of the REIWA, Damian Collins felt the holiday rental and short-stay market would be the one area that bore the brunt of COVID-19.

“Most of the analysts and myself felt the biggest pain would be in specialized residential property, such as short-stay or holiday rentals or serviced apartments,” said Mr. Collins.

“A lot of investors get sucked in by the higher yields, but your return from a property is always yield and capital growth.

“But also you’ve got to price in risk as well.

“I understand a lot of people who are in Quest Hotels at the moment are getting zero payments and they will be for a long time.

“It’s important to realize that for most investors, you’re far better off sticking with traditional properties in well-established cities that have got plenty of diverse industries that will provide a decent rental income but good prospects for capital growth.”

Mr. Collins also agreed with the consensus that it will be the outer suburbs that will feel the impact the most.

“The outer areas have people who are generally in those industries that are most impacted by COVID-19, such as hospitality or retail, whether it be renting or owning,” said Mr. Collins.

“More so than your traditional inner-ring suburbs.”

Despite the negative headlines, Mr. Collins is still positive about the outlook of property in the coming months.

“I’m a lot more optimistic than some of the bank forecasts,” said Mr. Collins.

“With mortgage rates at 2.29 percent and with the banks not foreclosing anybody, that means that even if people lose their jobs people aren’t forced to sell.

“Prices might not go up in the next 6-12 months, but I think only a very small percentage of areas will actually fall in any real way.

“Once everyone realizes things are back to normal and 92% of people still have their jobs, we’ll start to see a recovery.”

Prices to be higher in 12 months 

“I agreed with a lot of what was said in the paper, particularly around when the property was going to be hit the most,” said Leanne.

“No doubt we’ll see a short term negative impact on prices, but ultimately, in 12 months’ time, prices are going to be more than where we’re at now.

“This is a crisis like no other and when we had the likes of the GFC, the end-point wasn’t certain.

“In this case, we do have an endpoint, but we don’t know how many businesses won’t come back from this.

“With interest rates at historical lows and the property market already recovering, I think it is likely that prices will continue to grow when we get on the other side.”

Leanne Pilkington also felt that there is some risk to property investors who might be forced to sell.

“Some of our landlords have been negatively impacted by the stock market and nobody’s going to be selling their shares unless they really have to, however, some have been looking at offloading property to free up some cash,” said Leanne.

A reduction in activity

Interim General Manager of REISA, Andrew Shields says the Whitepaper results compare closely to what he has been seeing in South Australia, particularly in response to transaction volumes.

“Over 50 percent of our members were certainly seeing a 50 per cent reduction in buyer and seller enquiry,” said Mr Shields.

“So that impacts what will happen in the market place.

“Clearly supply will be dramatically reduced in the coming months, however, there is still demand and activity.

“We expect to keep seeing demand for properties that are well priced and well located, but there will be less supply, not no supply.”

Mr Shields expects there to be an impact on prices in South Australia, but it won’t be as pronounced as some have suggested.

“We’ve just come off two positive quarters in terms of sales, so while there might be a reduction, it’s hard to say what the fallout will be on the pricey side, ” said Mr Shields.

“I tend to agree with the Whitepaper where it suggests there will be an impact on prices, but perhaps not as much as we have been hearing.”

A flood of rentals

REIT President Mandy Welling feels the Ripehouse Whitepaper reflects the sentiment in Tasmania, however, there are some key differences.

“I think the general consensus of those interviewed are quite similar to mine with the exception of the areas which would be most impacted,” said Ms Welling.

“I think the middle socio-economic locations in Tasmania may be adversely affected,” said the REIT President.

“Many of our low socio-economic areas are Government owned and have longer term tenants.

“Many of our areas that would be considered mid-range are sought after by investors and first-time buyers.

“A considerable portion of these first-time buyers are in professions including tourism/retail/hospitality.”

Ms Welling said Tasmania might not see price big falls, but the rental market is a different story.

“In Tasmania, we were experiencing a dramatic housing shortage prior to COVID-19 and we are seeing few new properties entering the market,” said Ms Welling.

“Albeit we will certainly have a smaller pool of buyers once this recedes I do not believe we will have a considerable amount of stock available.

“The rental market, on the other hand, is another story, with the addition (or flooding) of the market with AirBNB properties.

“The issue we are having in Tasmania with those properties is many of them are fully furnished.

“Even without the trauma of COVID-19, these types of properties have a small market place as we do not experience the considerable flow of short term professionals relocating to Tasmania for business and requiring furnished properties.

“I am just preparing our current quarterly report of which we have not noticed much of a change over the previous quarter but I am very confident next quarter will paint a very different story.”

Embracing prop tech

Antonia Mercorella, CEO of the REIQ thinks the Whitepaper reflects how the industry is feeling at the moment.

“The COVID-19 Vs Australian Property Survey provides for some great insights across the real estate industry, particularly at this time when faced with a ‘once-in-100 year’ crisis in which we have all had to readily adapt to within an extremely short amount of time and operate in extremely unique circumstances,” said Ms Mercorella.

Given the unprecedented measures the industry has been forced to adopt, Ms. Mercorella believes this could lead to more changes in the future.

“The REIQ anticipates a fundamental shift in the way real estate agents and staff operate, particularly digitally,” said Ms Mercorella.

“This won’t just be witnessed from a consumer experience but from an administration perspective where most, if not all, processes will ultimately move to online platforms in the next 12 months.

“The industry has embraced ‘prop-tech’ with the necessary speed required over the last few weeks, that there’s no stopping it now and supporting this shift in technology will be an influx of new markets looking to Queensland as their new home.

“The key driver, of course, being affordability which will continue to be the State’s main drawcard backed by enhanced quality of life and relaxed lifestyle.

The COVID-19 vs Australian Property Report has been released by property research company Ripehouse Advisory uncovering the opinion and advice from 146 property experts.

By doing this survey and releasing their report Ripehouse Advisory has attempted to get to the heart of what to COVID-19 virus means for Australian property.

“To help paint this picture, we turned to our extensive network of Australia’s most trusted property professionals,” said Ripehouse Advisory CEO Jacob Field.

“Identified as key academics, leaders of Australia’s industry bodies, and the individual custodians of the various professions as related to property.

“The opinions and statements in this document provide a frank assessment of a drastically changed property landscape.”

At a Glance: 

  • Even with the impact of COVID-19, the experts most commonly believe in 12 months prices will be higher than they are now (27 percent of respondents).
  • Overwhelmingly, (72 percent) of respondents, felt that NSW would be the hardest hit.
  • Short Term residential rental properties, like AIRBNB and holiday homes, are in the firing line, whilst high cashflow and diversified rooming houses on fixed-term leases are highlighted as the most resilient.
  • Respondents said the peak COVID-19 impact would be felt between the 3 to 12 month mark from mid March 2020.

According to outcomes of the report, the areas most impacted by COVID-19 included 76 suburbs which have taken a hit due to the downturn in tourism nationally.

The study also identified the 76 suburbs most impacted by the downturn in tourism nationally.

The characteristics of these suburbs is as follows:

  • 389,437 dwellings in the firing line
  • 37 NSW, 11 VIC, 23 QLD, 5 TAS
  • 11 of these suburbs have already seen a more than 20 per cent reduction in asking rent.

Criteria used to identify these suburbs:

  • High concentrations of AIRBNB or holiday homes
  • Vacancy rates that are increasing rapidly
  • Already seeing dramatic decreases in the rental asking price per week
  • The study also identified 69 suburbs most impacted by the dramatic rise in unemployment in the retail, hospitality and tourism sectors.

The study also identified the 55 suburbs most insulated from COVID-19 nationally.

The characteristics of these suburbs is as follows:

  • 260,085 dwellings in these suburbs
  • 30 NSW, 10 ACT, 6 WA, 6 NT, 1 SA, 1 VIC, 1 QLD
  • A strong bias towards upper socio NSW suburbs and ACT.

Criteria used to identify these suburbs:

  • Highly Diverse Economies
  • Insulated from AIRBNB
  • Currently Low Vacancy Rates
  • Asking Rent Per Week holding through to today
  • Low new housing supply in the approval pipelines
  • Above-average per capita project (public/private) spend – IE. on new roads, hospitals, education, commercial, etc.

Mr Field said the study achieved what it set out to do.

“We understand that an individual respondent may be biased,” said Mr Field to WILLIAMS MEDIA.

“The report demonstrated that a varied group of industry experts can speak with poise and rationality even in times of crisis.”

The common theme from the report, according to Mr Field, was the real estate industry could survive in and after the pandemic.

“Time will tell as respondents did feel prices would only drop if people were forced to sell,” said Mr Field.

“A common theme was we can contain the virus and open back up for business in the 6 months repayment holiday, then this might be a small blip on the radar.

“As always we do however need to remember that Australian property is made up of many thousands of markets.

“The report did identify 55 safe haven suburbs, most likely to be insulated from large price corrections.”

Mr Field said the most telling piece of information from the report was that diversification lowers risk.

“Investors who have chased high yields via Airbnb, now find themselves overly exposed to the downside risk of a prolonged COVID-19 correction,” said Mr Field.

At a Glance: 

  • Even with the impact of COVID-19, the experts most commonly believe in 12 months prices will be higher than they are now (27 percent of respondents).
  • Overwhelmingly, (72 percent) of respondents, felt that NSW would be the hardest hit.
  • Short Term residential rental properties, like AIRBNB and holiday homes, are in the firing line, whilst high cashflow and diversified rooming houses on fixed-term leases are highlighted as the most resilient.
  • Respondents said the peak COVID-19 impact would be felt between the 3 to 12 month mark from mid-March 2020

Covid 19_vs_property_2020 by @GillandDebello #covie19 #landlords https://www.slideshare.net/GillandDebello/covid-19vsproperty2020

Property in Capable Hands

Through the purchase of this property, I’ve had the pleasure to meet Linda whom I’ve come to know as a very genuine person with in-depth knowledge about the current market and is very dedicated and passionate about her work. With her guidance, the entire purchasing process was extremely smooth and hassle-free.

This property had tenants prior to my purchase and has been managed by Linda and Carlos since it was nearly new. I feel very privileged and assured to have Linda and Carlos continue looking after this property for me.

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Removing the Hassle from Sales and Rentals across South East Queensland. Aim to Empower other like minded Property Investors. LJ Gilland Real Estate Pty Ltd LREA推荐书LJ Gilland房地产 http://ljgrealestate.com.au/testimonials/ http://ljgrealestate.com.au/competitive-commission/ http://ljgrealestate.com.au/property-management/ http://www.facebook.com/ljgrealestate L J Gilland Real Estate is a prestigious boutique agency specializing in Property Investment Management Services and the Sales of Investment Properties with tenants in place. Comprised of a top performing group of handpicked specialists, our Agents proudly serve Property Investors in Queensland. Since 1996 our Agency has demonstrated a genuine enjoyment of working with people, developing long-term relationships and delivering on the promise of great service. Carlos and Linda Debello offer property investor's the confidence to sell and lease in any market. We provide comprehensive market appraisals, exclusive multimedia marketing campaigns, and knowledgeable, highly personalized counsel on all aspects of real estate. Our Property Management Team is equally considerate, offering investors with in-depth advise, well-researched rental valuations, and highly professional rental management services. http://goanimate.com/movie/0M4bvcZzgIbI?utm_source=linkshare&uid=0u6RGtWsmlVc Carlos’ direct mobiles are 0400 833 800 & 0413560808. Linda’s mobiles are 0409995578 & 0414978700 (prefer email contact for Linda). Office 07 3263 6085. http://www.ljgrealestate.com.au http://www.yellowpages.com.au/qld/aspley/lj-gilland-real-estate-pty-ltd-14091356-listing.html http://au.linkedin.com/in/lindajanedebello http://twitter.com/GillandDebello http://www.facebook.com/pages/ljgrealestate
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