MARKET WEATHERS COVID-19 ‘SNEEZE’

Despite fears that Covid-19 would decimate the real estate industry, sales activity is stable in the Officer/Pakenham corridor says leading agent Peter Nicolls.

By Peter Nicolls

06-05-2020

Despite fears that Covid-19 would decimate the real estate industry, sales activity is stable in the Officer/Pakenham corridor says leading agent Peter Nicolls.

Mr Nicolls, the director of KR Peters, has been in real estate since 1976. He characterised the current crisis as a "sneeze" compared to the dramatic downturn of previous recessions.

In April, agents in the KR Peters Officer branch sold close to 20 properties, which is on par with activity during April 2019 according to Mr Nicolls.

"The market is definitely strong in the Officer-Pakenham corridor. Results in April are quite astounding," Mr Nicolls said.

He said sales consultant Liza Hickey had the best month in real estate since she started in the industry selling 8 houses. Fellow agent Aman Singh sold 4.

Many sales have been off market. Number 20 Pioneer Way, Officer, sold off market despite the vendor initially wanting to hold off his listing for six months. The property changed hands when a buyer matching the vendor's conditions was found in the KR Peters' database.

Number 9 Harlem Way, Officer, attracted 7 inspections and sold in three days.

Mr Nicolls said the Covid-19 restrictions had forced agents to innovate and mine the company database to match properties with buyers.

"On (a recent) Monday Liza Hickey had 8 inspections booked for one property. We've never done that many inspections of a property on a Monday in 40 years," Mr Nicolls said, adding that people were now more available for mid-week private inspections rather than most inspection activity confined to the week-end.

Mr Nicolls said despite unemployment tipped to reach as high as 10 per cent, the other 90 per cent of Australian workers still had their jobs and a steady income which should help underpin confidence.

At the end of March, even as the virus restrictions were strangling the economy, Mr Nicolls said there was still pent up demand from buyers approved for the Federal Government's 5 per cent deposit scheme who had yet to buy.

"The scheme created more buyers at that time than otherwise would be expected in the current market," Mr Nicolls explained.

In April Mr Nicolls said sellers adjusted their expectations to match the changed market.

"Suddenly sellers weren't listing houses at their dream prices. They expected to sell at the market price."

And, he added, buyers responded.

"In a market when you have buyers seeing good stock come on the market they grab it. Now is a great time for buyers."

According to Core Logic, the Covid-19 downturn has had a "dramatic impact on agent activity and listing volumes in residential real estate. But the value of dwellings has been relatively resilient".

"It is still likely that property values will fall amid the downturn. But the decline in momentum across property values has been relatively mild to what has happened in market activity,"
 Core Logic analysts wrote in a report this month.

Mr Nicolls said the Pakenham/Officer corridor was weathering the downturn in large part because of its affordability.

"The Officer/Pakenham area is moving because it is at a price range which is still affordable to a lot of people. Retirees, first home buyers and downsizers are still getting good value for money.

"I tell my staff that there is no difference today than when the market is good. The only thing that is different is the price.

"This one is like a sneeze because there are still buyers out there. In the 90s and in other recessions the market dried up."