Theresa Worrell: The coronavirus means nobody is searching for houses

Are you looking to buy a new home or investment property?

Well I know many strategic property investors are.

And homebuyers keen to take advantage of the market opportunities are also actively in the market.

But according to research from ANZ Bank most buyers and sellers have gone on strike

Of course things were different only a few weeks ago…

The latest Corelogic figures showed that over the month of March, housing values rose across every capital city apart from Hobart (which declined -0.2%), while over the March quarter, every capital city recorded a rise in housing values.

Index

House prices also grew strongly through the second half of last year and in March were up 10% from the low in June 2019.

But now shutting down of auctions and public open homes is very likely to put an end to that strong growth.

In a recent report ANZ Bank suggest that because of these measures, many potential buyers and sellers will simply withdraw from the market until the virus is under control and social distancing measures are eased.

As buyers and sellers dry up, ANZ think properties that do trade through this shut-down period will see price falls with only some sellers willing to enter such an uncertain market.

The ANZ Housing Search Index (HSI), which combines internet search numbers for house-buying related terms, fell sharply in March.

This suggests we should see house price growth start to slow in coming months.

Specifically the HSI suggests annual house price growth will turn over by June (Figure below).

This effectively indicates a fall in the level of house prices as early as this month.

That would be consistent with the flattening out in daily house prices, as well as the downturn in house price expectations.

But property values will bounce back

Once the social distancing measures are removed, ANZ think it is unlikely prices will simply bounce back.

Despite enormous fiscal support, unemployment is still expected to rise sharply through this period and is unlikely to fully recover for some years.

This, with a possible reassessment of debt appetite, will likely result in a slow recovery for house prices.

Get ahead of the crowd

Now is the time to take action and set yourself for the opportunities that will present themselves as the market moves on.

If you’re wondering what will happen to property in 2020–2021 you are not alone.

You can trust the team at Metropole to provide you with direction, guidance and results.

In challenging times like we are currently experiencing you need an advisor who takes a holistic approach to your wealth creation and that’s what you exactly what you get from the multi-award-winning team at Metropole.

If you’re looking at buying your next home or investment property here’s 4 ways we can help you:

Strategic property advice. – Allow us to build a Strategic Property Plan for you and your family. Planning is bringing the future into the present so you can do something about it now! This will give you direction, results and more certainty. Click here to learn more
Buyer’s agency – As Australia’s most trusted buyers’ agents we’ve been involved in over $3Billion worth of transactions creating wealth for our clients and we can do the same for you. Our on the ground teams in Melbourne, Sydney and Brisbane bring you years of experience and perspective – that’s something money just can’t buy. We’ll help you find your next home or an investment grade property. Click here to learn how we can help you.
Wealth Advisory – We can provide you with strategic tailored financial planning and wealth advice. Click here to learn more about we can help you.
Property Management – Our stress free property management services help you maximise your property returns. Click here to find out why our clients enjoy a vacancy rate considerably below the market average, our tenants stay an average of 3 years and our properties lease 10 days faster than the market average.