As the coronavirus pandemic brings huge chunks of the Australian economy to a grinding halt, the real estate market looks to have weathered the worst of the storm.
House prices have dipped slightly in most major centres but analysts are not anticipating a major crash, dashing the hopes of first-time buyers who have been locked out as prices soared in recent years.
Gold Coast real estate agent Sam Guo said foreign buyers were as eager as ever to invest in Australia.
“I have been speaking to a lot of my Chinese clients… they can’t wait for the borders to open,” he told SBS News.
“They want to come here, to see how beautiful the country is, and how safe it is.”
With fewer than 7,500 infections nationwide, Australia has been widely recognised as being successful in containing the COVID-19 outbreak.
“Health has become a priority, so they want to come to live in a country where there have been less virus cases,” Mr Guo said of his clients.
It is a sentiment that is echoed by Iwan Sunito, the CEO of luxury apartment and hotel developer Crown Group, who says he has been surprised by the amount of interest in investment during the economic downturn.
Mr Sunito said the group had seen $63 million in luxury apartment sales in February to April, mostly to overseas buyers.
Developer Crown Group CEO Iwan Sunito. Source: SBS News
“We thought the market would go down significantly, but actually it was the biggest sales we ever had in the last two years,” he said.
“To some extent, COVID-19 has caused people to think about Australia as a safe place.”
And the industry is expecting further investment when more restrictions are eased.
“We have seen people buying long-distance because they have family and friends who are here… [but] as we lift up all of these travel restrictions, that will see a lot more people coming through here.”
Data and analytics company CoreLogic’s latest home value index released this week showed Australia’s residential property market declined for the first time since 2019, dropping 0.4 per cent in May to $557,818.
Five out of the eight capital cities suffered a drop, with Darwin seeing the biggest decline at 1.6 per cent.
Source: SBS News
Melbourne was reported to be 0.9 per cent down, and modest falls were recorded across Sydney, Brisbane and Perth. Values were slightly higher in Adelaide, Hobart and Canberra.
Head of research at CoreLogic, Tim Lawless, said given the current economic climate, it is a good result.
“The 0.4 per cent drop over the month, considering the uncertainty and the extent of the economic downturn we’re moving through at the moment, I think is a pretty resilient result for the housing market so far,” he said.
But there are still fears the market could take a downturn.
“We are expecting there will be further downward pressure on housing values, particularly longer-term as we start to see stimulus being unwound around October, which also coincides with the expected lifting of bank leniency policy as well,” Mr Lawless said.
Australia has entered its first recession in 29 years, Treasurer Josh Frydenberg announced this week, with gross domestic product in the March quarter down 0.3 per cent.
Head of research at CoreLogic, Tim Lawless. Source: SBS News
But it remains to be seen how deep the recession will be.
University of Melbourne Professor of Property Piyush Tiwari said it was "definitely not the sellers' market" at the moment but so far the fall in property prices had been modest.
"So far, banks are healthy and once the economy comes out of lockdown, engines of growth will start moving," he said.
"This is a slow market, so the seller premium may not be there. It’s a fair market for buyers."
Dr Tiwari said that while there were some risks, Australia's property market was in a strong position to bounce back.
"This softness in the market is not because of lack of demand - the banking crisis and now the pandemic have all resulted in unmet demand, which will result in transactions once normalcy returns," he said.
"Recovery in the housing market will depend on how soon our borders are opened and how quickly the economy recovers."
People in Australia must stay at least 1.5 metres away from others. Check your state’s restrictions on gathering limits.
Testing for coronavirus is now widely available across Australia. If you are experiencing cold or flu symptoms, arrange a test by calling your doctor or contact the Coronavirus Health Information Hotline on 1800 020 080.
The federal government's coronavirus tracing app COVIDSafe is available for download from your phone's app store.
SBS is committed to informing Australia’s diverse communities about the latest COVID-19 developments. News and information is available in 63 languages at
