The Coronavirus pandemic has shut down many businesses that have caused the recession in the developmental sector. The GDP of Australia had a growth rate of -5%. During March, April, and May the real estate business was nearly flat. However, the businesses are opening under following the special social distance measurements. However, the real estate investment markets in Sydney and Melbourne are holding high positions. Although prices are remaining flat, the home transaction is still picking up.
The consumer and workers in Australia are powerful enough to bring back the economy at its normal point. The overall housing prices fell by 9.2%. The highest growth rate was estimated by real estate agents in Australia during March while it was decreased to 8.8 billion USD during April. It was estimated that 10% of masses will be unemployed by the end of September, however, the figure is just 8%. It means that we are coming out of this pandemic. The businesses injured with the Coronavirus pandemic are recovering.
The owners are reluctant to sell their homes. That’s why there are only a few homes for sales. The real estate agents in Australiapredict that home prices will increase once this pandemic will be over. The home purchase activity has decreased to 3% while refinancing is decreased to 6%. However, the lower interest rate has a significant effect on housing prices in Australia. The macroeconomics data changing globally has put a burden on the economy.
We can see a reduction in rental prices as well. The rental prices show a decrease of -0.4%. The rental market is heavily affected by unemployment. The property advisory services in Australia predict that young employees or less income people are mostly suffered by unemployment and rent prices. There is good and bad news. The good news is that housing prices are low that intrigues buyers. The bad news is that commercial investors are reluctant to invest under such conditions.
Australian Prudential Regulation Authority is making measurements to uplift this sector. The banks are offering easy investment opportunities to drive more investors. If you are looking to buy, make sure that COVID-19 will not affect your job or income. Do you have sufficient savings to buy a new home? Besides low-interest rate, buyers are uncertain of the long-term return from theinvestment.
The property advisory services in Australia are providing flexible routes to investors, buyers, and sellers to boost this sector. Typically, there are fewer sellers in the market. Only sellers want to sell their property under severe conditions. Mostly, low-income individuals are compelled to sell their properties to meet their ends. The market has become more tightened for the long-term investors during this pandemic.
The low or medium sized business owners are facing real challenges. Despite the stimulus package, there are a lot of other problems. A full rebound is expected in 2021. But it will definitely hurt the real estate market for a significant period in 2020. The things will eventually bounce back and we will get good results.