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Baby steps, but the Melbourne property market is reopening today.

While we still await a final directive from the REIV (Real Estate of Victoria) confirming the approved activities, the DHHS website says:

We are not expecting to suddenly see vast numbers of new properties hit the net.  Conversations with agents this morning suggest associated services such as copy writing, floorplans, staging etc. can also recommence, however, it may take a little bit of time for these properties to filter through.

Having said that, the number of advertised new listings has slowly been increasing. Possibly homes that were prepared for sale and about to launch before the lockdown at the start of August?

This will not be a full opening of the market. We believe the intention is to help stressed vendors (many who had purchased before selling prior to the lockdown) and buyers (particularly those who have recently sold) to transact and avoid possibly difficult financial situations or with nowhere to live.

We expect vendors will have contracts and section 32 statements prepared. Homes could sell after one inspection if the price and terms are acceptable. Buyers should be prepared to act quickly if the home suits.

Prior to the second lockdown, more often than not, homes were being sold subject to finance, sometimes for up to 28 days and with long settlements. Vendors lucky enough to have multiple interest may be more attracted to an unconditional offer or short settlement, even if the price is not quite as high as another offer.

It’s still hard to predict where the market will be when/if it resumes with some sort of normal. If Sydney is anything to go by, The Australian reported this morning that Sydney had 815 auctions on the weekend with a preliminary clearance rate of 74%, although it’s perhaps a tiered market with the strongest clearance rates in northwest Sydney at 83% while the west saw only 63% clearance.

We see our next three weeks being very busy with all hands on-deck, calling agents, inspecting properties and continuing on with virtual meetings with clients – old and new.

Still a bit longer until we can inspect homes again (this photo taken pre-COVID)

Based on the latest Victorian Government announcements, it looks likely that the property market will remain on hold until at least 26 October (cases permitting) when regulations are expected to relax and ‘one on one’ inspections can resume.

Real Estate will still be operating in a restricted capacity when it finally reopens; however, it will at  least allow some buyers/sellers, who are no doubt quite stressed at the lengthened lockdown, opportunity to buy/sell.

We think a number of homes could sell very quickly when the market reopens (possibly even after one inspection), as there are a number of vendors who have already purchased and need to sell.  The motivation for a seller may also shift slightly and, while wanting their ‘best price’, they may also consider accepting the offer that provides the ‘best result’ – possibly a short settlement and unconditional offer.

There will also be some buyers wanting/needing homes as they have already sold.

For buyers, we think finance approval will be a major key to being able to buy after lockdown and we recommend you remain in contact with your bank/finance broker, to ensure you are ‘buy fit’ should the right property present.

For sellers, we think having a current signed section 32 statement and contract ready for re-opening on the 26^th October is the most important thing to focus on, as without it the home cannot be sold.

There may still be some properties that sell during the extended lockdown.  These include:

• properties viewed prior to the Stage 4 lockdown, currently being negotiated
• properties with no or limited value in the home (ie. land value/new home site/development site)
• properties purchased sight unseen

We do not encourage purchasing sight unseen.  Purchasing a property is one of the biggest expenses you will make in your life.  Stamp duty is 5.5% on top of it.  That adds up to a lot of money if the home isn’t right.

The feel of a home is so important.  Sometimes it can tick all the boxes on paper but, walking through, it just doesn’t feel right.  How can you determine this from a video?

Will the video show you everything you should be looking at, or only what the operator wants you to see? What about neighbouring properties, slope, light, overlooking, building condition, ceiling heights, room sizes etc?

The video operator will likely be the vendor or resident, as agents, photographers, copywriters, etc are unable to attend any properties until 26^th October (unless to facilitate actions related to moving into/out of properties and rentals).

For those wanting to auction, the first weekend (using the traditional 3 week/4 Saturday model) for restricted auctions is 21^st November and advertising preparation can’t be done until access from 26^th October.

We therefore think the ‘private sale’ market, more commonly now called ‘off market’, will dominate initially and possibly right through until Christmas, as well as some unlisted quiet ‘off market’, although vendors of these homes may not be as motivated to sell.

If you’d like to chat in more detail, don’t hesitate to contact us;

Adam – 0413 318 079

Kristen – 0408 625 965

Alexandra – 0419 727 578