Extended lockdown has put Sydney’s booming housing market on ice as sellers pull the plug on auctions and delay listing new properties.
There were originally going to be just under 800 city auctions this week – a drop from the over 1000 in the week preceding lockdown – but early indicators were many would not go ahead.
MORE: How much average Aussie has in bank
Karl Stefanovic makes humble lifestyle change
Where investors are losing most money
Some vendors have committed to online-only auctions on Saturday but industry observers revealed a large portion would likely sell prior to auction.
Close to 60 per cent of the homes that would have gone under the hammer last week sold prior to their auction, while 23 per cent were withdrawn or postponed, CoreLogic figures showed.
Auctions have reverted to online platforms in many cases.
Under current restrictions, home seekers are permitted to view listed properties only by private inspection. Open homes and public auctions on site are not allowed.
Realestate.com.au head of economic research Cameron Kusher said the restrictions were putting the brakes on new listings but would do little to derail buyer confidence.
“There is enough momentum in the market for there to be a very quick bounce back when lockdown ends,” Mr Kusher said.
The lesson from Melbourne’s four month lockdown last year was that restrictions discouraged sellers more than buyers, he added.
Sydney had close to 1000 auctions per week in the lead up to the latest lockdown. Picture by Damian Shaw
“The Melbourne lockdown didn’t impact as much you’d think,” Mr Kusher said. “There was a drop in sales activity but there were still committed buyers.
“Sydney’s lockdown is not as strict and that will make a difference. There are also tools that make it a lot easier to view (homes) without stepping foot on the property.”
Mr Kusher said home seekers who thought it would be a good time to swoop in on a potential bargain would probably be disappointed.
Ray White chief economist Nerida Conisbee said the lockdown would have a stronger influence on what home seekers purchased, rather than whether they purchased at all.
The experience of previous lockdowns was that increased time at home often encouraged families to seek out bigger properties in lower density areas, she said.
“Lockdowns last year encouraged more people to look outside of capital cities to regional areas where they could get bigger houses. It happened everywhere but the trend was strongest in Melbourne,” Ms Conisbee said.