8th May 2020
Impact on Property COVID-19 May Update
We have been reviewing the market closely both during the COVID-19 restriction period and also as these restrictions ease. Market Commentary by economists have mostly been on the basis of the market response in the major capital city markets of Sydney & Melbourne which typically focusses on auction clearance rates.
Outside the major capitals, we have noted that for buyers where cashflow has remained relatively stable, that they are taking advantage of the opportunity that has presented during COVID-19 of less buyer competition. Accompanied by a very low interest rate environment, these buyers are taking medium term positions that were not prevalent in the market prior to the pandemic.
People that are currently pressing on with planning their development projects for 2020 are in some cases responding to this market change by adjusting their end product to suit a less bouyant market in the short term. These people typically have a more favourable view on market conditions during 2021 and beyond.
We are working alongside our clients to prepare “feasibility analysis” on such projects to assist the decision to make the end product appeal to the widest market possible. This also reduces the overall risk of such projects.