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In NSW the ban on open houses was lifted starting 9 May 2020. Out of curiosity, I attended several open houses in Sydney last weekend. To my surprise, I found myself to be the only interested party 4 out of 5 times.
We’ve gone ahead and crunched the sales data for the weekend. Here are the results. No bounce in sales volume due to easing of restrictions associated with COVID-19.
See the right-most bar on the chart and compare it to the year 2019 chart on the left.
Have you attended an open house or an auction recently? What are your thoughts?
I guess we cannot gauge the impact on the real estate market juts by seeing that there is not people at auctions. The nature of the whole landscape and the way people do business will change dramatically after Covid. I mean, entire workplaces are moving to an online communication system.
I am not discounting the approach, very hand on. All I am saying is lest wait for the statistics to see—maybe people will purchase properties by not even inspecting them. I know of people who have done so in the past without restrictions and investors tend to do that more often than not. Either way, there will be ample opportunity for investors to snap up some investment grade properties for a discount however there might be some lag in the statistics and figures.
I am positive and time is definitely needed to accumulate data and see the real impact. As an investor, I am definitely excited about the change in the landscape and opportunities presented. Auctions were definitely never my thing and they could potentially be phased out or done on line. I guess real-estate agencies should consider developing an on line system of conducting open houses.
Hi GK.
I agree with you that there are other factors than the number of people at inspections and auctions. Particularly prospective buyers deciding to ‘wait out’ and observe the COVID situation.
There is also a considerable time lag between an inspection, prospect buyer making an offer and the sale taking place. Restrictions pretty much blocked the first link in this chain of events. As restrictions are easing we expect the sales to ramp up gradually with a lag of approximately 2-3 weeks.
In fact you can see that it took 2 weeks for the sales volume to reduce after the restrictions were imposed. It is reasonable for the reverse to occur 2 weeks after the restrictions are eased.
I will publish an updated chart in 1-2 weeks for better clarity.
Looking forward to the updated chart Alex
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