A leading real estate agent says house prices could potentially drop by 10 per cent in the wake of the COVID-19 crisis.
Macedon Ranges agent John Keating of Keating Real Estate said it was too early to tell how much prices would drop, but it would be naive to think they won’t.
“Turnover is down, but in regards to prices, it’s too early to call. There seems to be a sense of inevitability that there will be a correction,” Mr Keating said.
“The impact is likely to be varied, but for residential median house sale prices, there’s a real possibility of it coming back 5-10 per cent and there could be some sections of the market that fall 10-20 per cent in a year or two.
In Brimbank Jim Hatzimosis at Barry Plant Real Estate said the current dilemma is similar to issues the market faced before the virus struck.
“It’s a fluid situation changing by the day by day,” Mr Hatzimosis said.
“There’s still transactions taking place, but the volume of sales has dropped off.
“There still remains a stronger demand than supply. Before supply was lower because everyone was in caution mode and that’s continued under this.”
Restriction ushered in as part of the government response to slow the spread of COVID-19 put a stop to in-person auctions and open house inspections.
Mr Hatzimosis said while that’s had its challenges, the industry hasn’t shut down.
“We’re working with less buyers, but the ones we are working with are keen to buy. There’s less inspections, but a high quality of inspectors,” he said.
“Our Doncaster office actually conducted an online auction recently with had 112 people watching, 11 registered bidders and sold for $75,000 over reserve.
Further west in Melton it’s a similar situation.
Nancy Crupi of YPA said it had been a major adjustment.
“We’re working a lot differently, which I think is the same for most agents across the west,” Ms Crupi said.
“For us it’s been about changing the way we take people through a property.
“For example we take a husband and wife through a property one at a time.”
She said it was a bit of waiting game.
“A lot of people are holding back in selling so we’re just waiting to see what happens.
“Buyer activity is great… there’s a lot of good buyers out there at the moment, but they’re looking at less stock.
“Everyone is understanding but it’s definitely going to be at least May 11 before we can have auctions and open houses.”
