This month, Tim Lawless of Core Logic reported on the third consecutive month of minor value falls, with the national average falling 0.6%. Sydney values fell by 0.9%, however regional areas appeared to be more resilient with unchanged values. The effect of COVID-19 on housing values has been “relatively orderly to-date” with Core Logic’s national index falling only 1.6% since a high in April.
“Government support, low interest rates and loan repayment holidays for distressed borrowers have help to insulate the housing market from a more significant downturn”. The number of advertised properties fell by 4.3% over July, sitting 15% below where they were this time last year, however new listing number continued to rise through the month, up 46% from the recent lows of early May, bringing them slightly higher than a years ago. It appears on a number of indices that the market is recovering from a low in May.
In Sydney, dwelling values have dropped about 2.1% since the April high, but are still 12.1% better than 12 months ago. At the moment the average annual growth over the last decade is 4.9%
“In summary, housing markets have weathered the COVID storm much better than we originally anticipated” However, Lawless also makes note that with Government support staging a gradual retreat from October it’s logical to expect a rise in distressed properties coming on to the market, and undoubtedly other factors.
Likewise, Domain reports that the full scale of COVID-19 on the property market is yet to be realised with ANZ, CBA and NAB all predict national house price falls in the vicinity of 10-15%.