Over this financial year, drastic changes in the real estate market have occurred. Due to COVID – 19 new lockdown restrictions have taken place, limiting travel and entertainment options for families and individuals. Many people have found themselves in a position ready to purchase or lease a new home due to saving money.
The real estate market has strengthened considerably over the financial year, in particular, the past 3 months. These last 3 months have shown the highest readings the Goulburn real estate market has seen for the last 10 years. The rental market has seen an annual growth in median rent per week of up to 5.4% with the median rental price for houses now rising to $390.00 per week.
The sales market has seen the median house price go up to $469,000, meaning over this financial year an increase of 9.8% ($42,000) has taken place. But why have these drastic changes occurred?
The baby boomers have found themselves in a position where they are selling their family homes in Sydney and moving to Goulburn. The Sydney market has seen an even larger increase take place, median unit prices in Sydney have risen 8% in the first half of this year and 5% in the first half of the financial year. Apartment prices have now recovered in a very healthy manner. With an overall 20% increase taken place over the financial year for houses only, this means that purchasers were forced to find value in the apartment market due to such a substantial increase in standalone house prices.
The market has only continued to rise across Australia, however Sydney has shown one of the highest ever increases throughout the country. With lockdowns now in place in Sydney, limiting the ways people can view a property or the way they purchase. No open houses are currently taking place, inspections can still be conducted but they must be by appointment on a one on one basis, and Auctions must be online. These processes are now more labour intensive for real estate agents.
It is now only the most motivated buyers and sellers out there looking to do business today. Here in Goulburn, we still have the option to conduct inspections with more attendees as well as open houses which has played a huge advantage with investors and owner occupiers looking to purchase in a more affordable location not as strongly affected by the COVID – 19 lockdown restrictions. Goulburn’s growing population is now on the rise. With $24.1 Million spent on new infrastructure in the past year, more people are looking to make the move.
But when will the boom end?
Markets tend to respond to triggers, in 2012 the RBA increased interest rates which stopped the boom at that time in its tracks, in 2017 APRA stepped into the market with lending measures that stopped the boom in its tracks. Markets respond to triggers; this lockdown may not be the trigger to change the current market, time will tell.
A lot of uncertainty arose from restrictions at the beginning of last year, therefore the housing markets overall attitude plummeted. But supply also declined, because sellers’ agents knew it may not be the best time to market the property, resulting in low stock levels. However, this time around, with income support packages provided to households, the role of Job Keeper, low mortgage rates and mortgage payment deferrals there are more options.
Many people have had different opinions on how the COVID – 19 outbreak has impacted the current market. However, in our opinion social restrictions do not deter anyone from buying a property, therefore it should not deter sellers. Property prices across the country have only continued to increase, meaning we are receiving some of the highest quarterly growth rates seen since 2011.
Increasing numbers of buyers are putting offers in for property sight unseen or after a video walk through as there is reduced stock. For the first half of last financial year the market was driven by owner occupiers and not so much by investors. However, as the lockdown extends in Sydney, we expect the 2021 trend to continue with an increased number of investors purchasing properties in Goulburn as they are more likely to buy properties unseen and based purely on the financial figures, with not as much emotional attachment.