By Herron Todd White
Lismore/Casino/Kyogle Property Update
“I…don’t…recollect…this…place” Gandalf surmised thoughtfully as he peered down into the abyss of the three jagged stone tunnels. The hobbits nearby fidgeted. After what seemed to be a lifetime of silence, Gandalf quipped …“Ah ha..that way!”.
Bilbo piped up confidently ”Do you remember, Gandalf?”
“No…..but this one smells far less fouler than the others…when in doubt, follow your nose”.
And that is exactly where we find the property market within the regional areas of Lismore, Casino and Kyogle. With the unfolding saga of the Coronavirus pandemic, even the seasoned soothsayers and Nostradamus-like commentators are not in a position to state how the region is going to react in such…wait for it…unprecedented times. We generally just use our gut instinct and follow our nose as we progress forward in these unchartered waters.
The Northern Rivers region has had its fair share of drama over the past few years including the seriously damaging flood event of March and April 2017 in Lismore City and the surrounding region and more recently the ferocious bushfires in the rural localities and rural villages of Richmond Valley, Lismore and Kyogle Council areas.
For suburbs such as Central Lismore, North Lismore and South Lismore which were hardest hit, it took nearly two years after the flood event before residential sales activity started to show some life. Interestingly though, property prices did not dive as a result, it just took longer to sell. However, Lismore City is still hurting with quite a few businesses struggling to recover
This particular unfolding pandemic has far reaching implications that affect not only the economic wellbeing of the region but also the social and psychological aspects that are likely to rupture all that we have become accustomed to living with in a western society for a few more years to come.
So, how does this affect the property market within the Lismore, Richmond Valley and Kyogle Council areas right now? Subsequent to the restrictions we have seen a definite slowing in overall sales activity. Considering that onsite property auctions are currently banned in New South Wales and open house inspections ceased for large groups with only private appointments being permitted, it is not difficult to see that both sellers and purchasers are somewhat on edge and that listings have fallen.
Many are waiting to see how things pan out on the other side before re-entering the property market. With unemployment figures likely to soar past ten percent (according to some commentators) and some property owners and renters suffering mortgage stress and cost of living pressures, the lack of confidence in the economy is likely to bite and bite hard in the short term.
It is too early to categorically state that property prices are falling; we need recent local sales data to confirm this. In reality, much of the sales data recorded in RPdata and EAC as being settled in late March and early April 2020 were exchanged or agreed some 30 days prior…before the proverbial had hit the fan for Australia in late February 2020. That’s only two months, but one would not necessarily disagree with the possibility that prices may fall in the near future, especially if the semi lockdown continues. Confirmed sales data in May 2020 will give a more accurate picture. Anecdotally, sales are still happening albeit at a reduced pace and prices appear to be holding at the moment. No particular property type is immune to these ructions as all parts of society are affected.
On the flip side, with the interest rate levels at an all-time low (where have I heard that before?), it is highly unlikely that the federal or state governments and even the lending institutions would be keen to raise interest rates for quite some time. There needs to be ample encouragement for the market to recover and get back on its feet. For those in a position to make the next step to purchase their first home or invest in another property, there could be some very attractive lending deals to be made once the pandemic is under control and society begins to inch forward to some form of normality.
In regard to rent, this is also fraught with uncertainty. The federal government has pretty much left it to state governments to manage this malaise. Following loss of employment, there are plenty of the renting public who are going to struggle in their ability to pay rent. Even with the promised job keeper pay and other Coronavirus supplements, the ability of governmental agencies to deliver these resources in a timely and efficient manner is crucial. It would not be uncommon or unreasonable to see some deferment in payment of rent.
In either case, there are going to be some sensitive negotiations between landlords, tenants and property managers. It would be unwise to request an increase in the rent on review in the midst of the pandemic and expect that story to reach A Current Affair if you tried. However, in saying that, we have noted that residential properties in Lismore, Kyogle and Casino continue to be listed for rent and are being taken up relatively quickly. This is possibly due to the existing lack of rental accommodation stock.
In summary and ironically, the demand and degree of sales activity in this region is following the oft used pictorial of the flattening curve of the daily COVID-19 count….for it is definitely flattening, real estate activity, that is. Let’s hope for an uptick in activity on the other side.
Speak with a Lismore Mortgage Broker today.
Ballina Property Update
The impact of the Coronavirus is yet to be realised by the local residential property market however is having a major impact on local businesses in the area of Lennox Head, Ballina and surrounds. Verbal discussions with local agents indicate a decrease in interest in listed properties along with a decrease in vendors placing properties on the market in these uncertain times. The north coast of New South Wales has seen very little infections from the limited testing. The the majority of infections have been recorded in the Byron Bay locality. As yet we are still in a fairly firm market with some recent sales in Lennox Head, Ballina and surrounding areas making good prices. Sales of vacant land in Epiq and surrounding areas have slowed slightly with some local builders indicating land owners postponing building until the economy stabilises.
The market drivers within the sought after coastal areas of the Ballina Shire are typically influenced by the performance of capital city markets – most notably the Sydney and Melbourne markets and to a lesser extent the Brisbane and coastal south-east Queensland markets. Whilst demand resulting from these capital city markets has typically been concentrated in the more desirable areas of Byron Bay and the surrounding localities, in more recent years potential purchasers have expanded their searches into the other desirable areas of the Ballina Shire – most notably Lennox Head, Skennars Head and East Ballina, as well as the rural localities of Newrybar, Brooklet, Fernleigh and Tintenbar.
Byron Property Update
As with many localities across the country, Byron Bay and environs have felt the impact of the Coronavirus in recent weeks. Byron Bay is predominantly a lifestyle and tourist location and the impact of social isolation has resulted in the temporary closure and scaling back of many businesses in the shire associated with the tourism and hospitality sector. The cancellation of the Byron Bay Bluesfest this year put a dent in the local economy and Splendour in the Grass was looking shaky but has now been postponed to October and will hopefully go ahead. Social distancing is being taken seriously by most people, however property inspections by valuers have not been impacted to a great degree. Many home occupants follow our advice to leave doors open and lights on so valuers do not need to touch anything and, of course, we have developed a contactless inspections tool which can be taken up as an option by tenants and owners.
The residential market could best be described as being in a state of some uncertainty. Many buyers of Byron Bay property originate from Sydney and Melbourne and travel restrictions mean property inspections have slowed. The strong market from earlier in the year meant that vendors could ask for, and sometimes achieve, a premium for their properties, however some recent sales and agent feedback suggests that vendors need to be more willing to negotiate to achieve a sale in the current market. Many agents have reported a general slowing of enquiry levels, but that those enquiries from both buyers and sellers are genuine in nature with fewer time-wasters. A couple of agents have even speculated that in the long term, Byron Bay’s popularity amongst cashed up capital city buyers may increase as a result of COVID-19 as people look for safe places to live away from the potential of future, similar pandemics.
Byron Bay’s popularity as a tourist destination and the advent of web based holiday booking sites such as Air BnB has seen an explosion in recent years of apartments and houses being rented as short term holiday homes. This, in turn, put upward pressure on the permanent rental market with higher rents and lower vacancies. Coronavirus travel restrictions have caused a temporary collapse in the short term holiday rental market and many of these holiday properties are now finding their way back into the permanent rental market as owners try to keep their properties producing income to cover mortgages and expenses. This may lead to more affordable properties for renters as more and more former holiday properties come onto the permanent rental market.
Moving forward, it is likely that we will see isolated instances of forced sales as some homeowners lose their jobs or businesses but, if effective, the government’s stimulus package and lenders’ hardship provisions will hopefully keep these to a minimum.
The short term impact on the residential market in Byron Bay and surrounds remains uncertain for now. The fundamentals that drive the Byron Bay market remain relatively sound; the area retains its image as a lifestyle and tourist destination, however it is the broader economy that will more likely impact property values in the area as well as the attitudes of buyers and sellers. That is to say, it is the level of confidence and the level of fear which buyers and sellers exhibit that will likely impact values during the current crisis.
Clarence Valley Property Update
“What a change”, “a different time” and “the new normal” are a few of the most common phrases you’ll hear across the Clarence Valley at the moment.
The Valley itself, comprising beach locations such as Iluka, Yamba, Brooms Head and Minnie Water and Wooli to the south as well as hubs such as Grafton and Maclean, is in disarray. With a vast majority of businesses closing their doors, albeit optimistically just for a short while, or operating at a reduced capacity, the people of the Clarence are somewhat lost with one long-time local even commenting that the quiet main street in Yamba echoes that of forty or more years ago.
How does this translate to what we are seeing in the property sector? Well in short, we are seeing less. That is, there are fewer sales, less new leases and reduced construction – basically considerably less spending! However, the market is still ticking along. Sales are still in fact occurring notwithstanding the undeniable whiff of uncertainty in the air. It is clear that these are unprecedented times, however with few confirmed cases of COVID-19 in the Clarence Valley, morale is relatively stable and the community remains strong.
Certain holiday destinations such as Yamba have likely felt the burden of changes abruptly with its stream of visitors forbidden, while other hubs such as Grafton have seen business as usual in many ways with numerous services adapting and continuing to serve the community.
In terms of sale prices in these areas, we are yet to see any firm evidence of price decreases, however there is talk of offers at the lower end of the spectrum being accepted and the power in negotiations certainly lies with the purchaser. Yes, we are seeing selling periods lengthen, however we must highlight that stock currently being transacted was likely listed for sale prior to the pandemic state. The question is, how will new stock entering the new market be absorbed?
Generally, the healthiest segment of the market continues to be the sub-$500,000 segment whilst the prestige and holiday home sector, which has historically been dictated to by the property markets in capital cities, is more sporadic and we are noting a reduced volume of transactions.
As for the future, it is likely that the lower end of the market will recover more quickly than the prestige market and undoubtedly, the health of the property market will mirror that of the economic wellbeing of the community.
Coffs Harbour Property Update
The New South Wales COVID-19 Cases and Community Profile by the University of Sydney indicates that the 19 registered cases for the Coffs Coast are north from Red Rock, south to Nambucca and west to Bellingen Shire. This area traditionally experiences high volumes of visitors over the Easter period and lockdown laws and restrictions on travel have deeply impacted the tourism sector, with accommodation, local clubs, hotels and restaurants being forced to close. Local Air BnB operators are required to carefully screen guests to confirm that reasons for travel are within the essential guidelines. Some local retailers of sports equipment such as surfing, bike and fishing shops have experienced above average trading as residents seek to maintain exercise in the absence of community sport. Hardware and landscaping retailers are also experiencing steady levels of business as people stay at home and attend to projects inside and around their homes. The construction industry, a major local employer, remains working with some social distancing restrictions in place on sites. General temperament of the area is cautious as to the potential length of lock down, its associated economic effects to the region and long term survival of local businesses. The community appears diligent with limited reports of lock down breaches.
Valuers are considered essential workers and have the resources to work from home effectively. Herron Todd White was the first to adapt to the new work environment by helping create contactless inspections in conjunction with the Australian Property Industry. Herron Todd White developed an application for home owners and tenants to use whilst external inspections are undertaken. We have seen noticeable decreases in the volumes of residential work since the outbreak.
While the community is cautious as to the economic effects of the Coronavirus, local property owners and professionals appear to have a wait and see attitude as to potential downward movement of market prices. There has been a reduction in the number of properties available for sale. This may be the result of local upsizers and downsizers putting moves on hold until restrictions on open homes and lock down measures are eased and out of town investors can return to the area. As market confidence declines and potential players in the property market continue to view now as not a good time to buy property, we feel that prices are likely to ease in the coming months. We have heard several reports from local real estate agents that there are already sharks circling, waiting for the pain to become too great for some people.
There are no clear indications of reductions in values or rents at this early stage of the pandemic. Market conditions prior to March 2020 had been strong for several months with steady levels of transactions and prices. Some real estate agents report that a handful of sales signed prior to this time have had minor reductions (less than ten percent) as nervous vendors accept minor reductions to complete transactions. Some investors have withdrawn from contracts as properties have been purchased vacant and the potential for attracting tenants is uncertain.
The main pain area for rentals is holiday accommodation. Several property managers are reporting that owners of holiday properties are now seeking short term permanent accommodation to provide steady income throughout this time. This may oversupply some sectors of the rental market in the short term.
As the government rolls out stimulus measures for businesses affected by the Coronavirus, some local operators may benefit, however the long term sustainability of some local small businesses may be shaky. The New South Wales government’s six month moratorium on residential tenancy evictions during the pandemic may leave some investors nervous as their level of repayments restricts their ability to negotiate lower rents with tenants and landlord insurance does not cover unpaid rent by tenants affected by the Coronavirus. Some banks are reducing repayments to minimum payments or have facilities to defer repayments, however in the long term the landlord must cover this cost. The government’s initiative of allowing early access to superannuation of up to $20,000 may be an option for investors and homeowners affected during this period and for the short term.
Unemployment for the Coffs Coast is traditionally high, consistently exceeding national averages. Some major projects for the area will continue to see employment opportunities in construction and, longer term, in health industries. The Coffs Harbour Pacific Highway bypass is earmarked to start in 2020 and the Coffs Harbour Base Hospital expansion and $100 million retirement development, The Shore, are both currently under construction. On completion, these will bolster employment opportunities in health and associated services. However, the area is still very reliant on tourism and sporting events, all of which have no rebate in sight and will take a toll on the local economy. Investor products will most likely be more susceptible to market fluctuations as tenant security and general market sentiment declines. Investors are not visiting the region to purchase and face uncertainty in personal income security. New unit developments, prestige property, subdivisions and spec dwelling prices are most susceptible to reduced demand.
Local real estate agents have reported a general decline in enquiry rates, however note that enquiries they are receiving are from genuine qualified buyers needing somewhere to live. These purchasers have most likely been in the market looking for the past few months and missed out on previous opportunities.
It is still early days and sales evidence is not available to indicate any present decline in values. Sales numbers have slowed across all price brackets and only time will tell whether there will be any significant price reductions. The Coffs Coast market is relatively small in comparison to larger cities and therefore more insulated to dramatic fluctuations in price.
Investors in the area should be seeking to purchase properties with secure tenancies and other features such as good proximity to services and places of high level employment such as hospitals and universities. The holiday unit market will most likely be the most severely impacted, however for units with the option to convert to permanent occupation, rental return may be bolstered during this period.
At this point, it is impossible to predict the extent or breadth of future economic volatility and the impact it may have on the local property market and values. During the global financial crisis market correction of 2008 to 2010, the effects in the Coffs Harbour property market in general were initially milder and prices were not impacted significantly for some years later. Low to mid-range properties (less than $800,000) are likely to endure a milder downturn whilst the higher the value, the more prominent the effect will be.
Speak with a Coffs Harbour Mortgage Broker today.
Hunter Region Property Update
It’s the close of the fourth month of the year and the Hunter region was part of the Coronavirus statewide lockdown. The property industry was quick to transition to virtual viewings and contactless inspections.
The Hunter New England Local Health District of which we are a part has recorded 278 confirmed cases of the virus. Given the circumstances, this is relatively positive compared to the number of people living in the region and what we are witnessing globally.
With social distancing restrictions and auctions and open house inspections banned, the way properties are inspected and purchased in the region has quickly shifted. Private property inspections are now the new normal and online auctions through portals such as Auction Now are being held until the restrictions are lifted.
Values appear to be holding and remain steady at this stage of the pandemic. Real estate agents around the region have reported that the number of appraisals and properties being listed have decreased with vendor confidence being the main factor. Agents also advise that there have been new enquiries from some buyers anticipating potential opportunities, throwing in some low ball offers trying to secure bargain properties that may come about as a result of this uncertain period in time.
Generally at this stage it is too early to tell if any particular areas or suburbs will be more affected than others, however one concerning area is Port Stephens where the market has been more susceptible to volatility in the past. Post the global financial crisis, Nelson Bay had one of the highest rates of mortgage delinquencies and mortgagee in possession sales in New South Wales. This area relies heavily on hospitality and the tourism industry, with a seasonal influx of visitors propping up the local economy. According to Port Stephens Mayor, Ryan Palmer, “The tourism industry is worth $621 million to Port Stephens every year and it is estimated that up to 20 percent of the workforce could be lost over the next 12 months,”. In an attempt to mitigate the effects of COVID-19 on the local economy, Port Stephens Council has pledged $500,000 in funding to support the tourism and business sectors most affected at this time.
Increased unemployment in the Hunter region may play a part in the market by removing buyers involuntarily and investors may become more cautious. Agents are reporting an increase in rent reduction requests, potentially reducing the appeal of property investment at this time. It is hoped however that the shortfall of listings will offset the number of buyers dropping out of the market and the market may remain relatively steady. Time will tell.
The Newcastle Herald reported that developments in the region are still powering along with Newcastle leading Australia in building and development activity. This instills hope that our region will hopefully not be knocked around too much with buyer demand still strong for new apartments in the city and fringe suburbs. Builders and tradespeople in the area are fortunately still working, with the sector considered an essential service and vital to the economy and jobs.
A potentially record breaking listing has just hit the market in Warners Bay, located opposite Lake Macquarie on The Esplanade. It is reportedly on the market for offers over $3 million which if achieved, will set a new suburb record.
As reported in February, one of New Lambton’s more prestigious properties, The Ridge, has settled in an off market transaction for $3.86 million. This is the second time this property has broken the suburb record; the previous sale of $2.7 million in 2006 was also a suburb record at the time.
Central Coast Region Property Update
The New South Wales Central Coast sits immediately north of the Sydney metropolitan area and such is the crossover between the two regions that the Central Coast is feeling the effects of the government imposed restrictions and lockdowns. As at the time of writing, there had been no further reported cases of COVID-19 for several days, with the region’s tally sitting at 18. From our observations, the lockdown measures have been accepted by local residents. There are far less cars on the road during the day and usually busy residential streets are similarly quiet with less kids and walkers out and about.
Terrigal is one the major tourist and social locations on the coast and a visit there on the weekend saw it almost deserted compared to normal times. It’s somewhat eerie and sad to think this beautiful location is going through this, but while it remains an accepted change for the better, it seems everyone is on board with it. From what we can see, other areas are in a similar position.
In day to day terms, we have implemented new rules with measures in place to address the changes and, while disruptive, like most other services, we have adapted.
While still early days by statistical standards, the effect of COVID-19 has been noted across the region with properties still selling, but at reduced volumes. Real estate agents are doing well to continue the momentum and have found new ways to do this. We are yet to see any hard evidence of the market retracting at an alarming rate, but this may change over the next few months as more evidence emerges.
With social distancing restrictions and with auctions and open house inspections banned, the way properties are inspected and purchased in the region has quickly shifted. Private property inspections are now the new normal and online auctions are being held until the restrictions are lifted.
In the meantime, we are finding that the more advanced real estate agents have kept the lines of communication open with the exchange of views, updates and ideas remaining. Other real estate agents will likely remain unwilling, thus missing opportunities.
We are hearing and seeing a few cases of prices being renegotiated after an agreement had been struck by those with an opportunistic flair, but these aren’t too common yet. One example was a $40,000 reduction sought on a $900,000 purchase and in that case the vendors were apparently okay with it – but again, this isn’t common.
In terms of government and semi-government organisations and the retail sector, both from a professional and personal view, we have to admire these people. They are keeping our world moving under pretty extraordinary circumstances and they are doing well.
Anyone familiar with the Central Coast will appreciate that while we have moved away somewhat from the tourist-reliant economy of years gone by, there is still a level of dependence on the tourism sector and yes, the cafés and eateries are suffering particularly. Many have gone into the new area of home delivery and it seems to be working to at least keep the doors open.
On a more specific note, we are yet to see any real and substantiated falls in property values. As mentioned earlier, it’s too early to confirm or dispel this. If we are pushed to make a prediction, then we see holiday letting properties suffering somewhat due to this market being dependant on disposable income to keep it going. We see the prestige market at the upper end of the market range being affected as well – we just don’t know yet whether it will be in the positive or negative.
For the middle market where most locals are situated, at the moment we don’t foresee any great long term effects while the usual level of confidence in knowing that the world will soon right itself remains. We are out in the field as part of our daily jobs and the acceptance of most people of the situation and the positive outlook generally is the main message coming through to us.
Much more serious is the reality that as workers are stood down or let go entirely and remain unemployed for too long, it will be inevitable that mortgage stress will become the new topic of conversation. The ramifications of this anywhere is not to be taken lightly as firstly, people’s livelihoods are affected in a most personal way and secondly, the effects on the economy will be felt by all. Fortunately, and this is an upside of living so close to the Sydney metropolitan area, once we move into the recovery phase post COVID-19, many of the local residents will probably have employment opportunities in the Sydney market.
At the moment, it appears the residential market is continuing as normal with little feedback from tenants finding themselves in adverse situations. Real estate agents have adapted well to changes, with most seemingly across the details of remedies and rights. At the moment, we’ve had very little enquiry from landlord investors seeking strategies to maintain or better their outcomes but when they do, our advice would be to expect a factoring of tighter margins of capital growth and consolidate their portfolios with a view to adding value when expansion is available and yields show signs of becoming firmer.
Tamworth Property Update
According to NSW Health, the Tamworth LGA has had 13 confirmed cases of COVID-19 with the Armidale, Gunnedah, Glen Innes, Upper Hunter and Inverell LGAs reporting one to four cases each. The general sentiment in the New England and north-west region appears to be one of cautious optimism. While the community is still apprehensive relating to COVID-19 concerns, it appears to be buoyed by its relatively successful containment so far and recent well received rainfall events.
Like many professionals, COVID-19 has presented some challenges to the life of a property valuer which have resulted in additional measures including social distancing, wearing PPE on inspections, sanitising hands, using contactless valuation inspections when required and working from the home office. These additional measures are extremely valuable in protecting our clients and our employees from the dangers of COVID-19, particularly moving towards the colder winter months.
Anecdotal evidence shows that the residential and rural residential market (including rental returns) remains largely stable in large areas of the New England and north-west and it is anticipated that the full effects of COVID-19 have not fully played out yet in our residential and rural lifestyle property market. The full impacts will largely depend on how quickly the economy can resume normal trading conditions and the extent of future job losses. We anticipate the true impacts on the local property market to become clearer over the coming months.
The good news is that residential property is still selling in the New England and north-west, particularly in the larger regional centres such as Tamworth, Gunnedah and Scone. Many properties under $400,000 are selling at or near the listed price, while the traditional sub-$300,000 properties in locations such as West Tamworth have been selling well, with both investors and home-occupiers seeking renovation opportunities at reasonable prices.
Anecdotal evidence shows that fewer higher-value properties are on the market and selling periods have increased. At present, these higher value residential assets appear to be most vulnerable in this time of economic uncertainty. Interestingly, some agents are even reporting increased interest from metropolitan based investors seeking rural lifestyle assets for additional space and fresh air. Whether this is a lifestyle trend that continues remains to be seen!
The federal government’s job keeper initiative has been warmly received by many families and small businesses in our local rural economies which will hopefully allow many small businesses in the New England and north-west to remain solvent throughout the Coronavirus crisis and beyond. While many businesses have temporarily closed, we can only hope they will soon have the opportunity to re-open their doors.
Recent rains have brought renewed vigour to our primary producers and the rural agribusinesses that are sustained by the success of the primary industry. We can only hope strong commodity prices and positive seasonal conditions continue over the coming months, especially in this time of wider economic uncertainty.
There are plenty of opinions as to how this Coronavirus situation will play out and its impacts on the wider economy and our regional property market. Whatever the case, we must all remain positive that better times lie ahead and this global reset produces a silver lining for our regional property market.
Remain positive – better times lie ahead.
Speak with a Tamworth Mortgage Broker today.
Southern Highlands Property Updates
It has been a huge month of ups and downs across Australia and the world, causing a huge amount of change to our daily lives in a relatively short period of time.
So how has COVID-19 directly impacted the Southern Highlands property market and day to day operations for our business? Well, based on the University of Sydney’s online tracking tool, we can see that the area has experienced a total of six cases, which is considerably low and great news considering the average age demographic of the area is nearly 50 years old.
So far, our experience in the area and on inspections is that the general temperament of the community is understanding and has been very positive. Agents and clients are ensuring that all parties are maintaining their distance and assisting each other to inspect the properties with minimal fuss, carrying on with business as usual. As professionals, we are offering multiple options to the community for our inspections to ensure we can still conduct our business, even if this means being unable to enter houses due to high risk clients being in residence. This has been achieved through a Herron Todd White-created application that allows the customer to assist the valuer using their own mobile device without a valuer even having to enter the property! This is only being used in extreme cases but it has allowed us to continue to service the community without putting anybody at unnecessary risk.
As far as local market performance goes, we have seen a reduced number of transactions due to the restraints on agents for showing properties, however as the situation has unfolded we have had some agents report that one on one private inspections have been positive with prospective purchasers finding it more comfortable than the traditional mayhem of an open home. Realistically at this point with such limited transactions, it’s extremely difficult to gauge current market sentiment across the board and only time will tell the full impact the local market may experience.
Looking at the local rental market, we are hearing that enquiry is surprisingly strong with some agents indicating strong interest from Sydney as more people are now working remotely and finding it far more affordable to rent outside of the big smoke.
Going forward, local agents are confident the area will bounce back pretty quickly and we have a feeling that in the medium to long term, the area will continue to grow, particularly as people continue to work remotely and become far less reliant on daily commutes to the office. A work culture offering employees more flexibility to work from home after Coronavirus-enforced restrictions lift is likely to see an influx of people fleeing built up areas for larger regional centres, particularly ones that still offer excellent access to the major cities.
Albury-Wodonga Property Update
The Albury-Wodonga and north-east Victoria service area we cover is complying and coping very well amidst the COVID-19 pandemic currently gripping the world. Infection rates are very low across all the LGAs in our service area and the social distancing and non-essential travel restrictions are evidently working very well.
Many of the positive attributes highlighted on a regular basis in regard to the benefits of regional living are definitely on display as we navigate this unprecedented social and economic disruption.
Low population density and a broad employment base are favourable factors at present, however retail, hospitality and tourism sectors across our area are suffering and for many, this is a double insult after the very recent bushfire crisis. Hopefully our very low infection rates will continue and create confidence in our region and in time, when travel restrictions are eased, place the area in good shape as an attractive and safe area to visit and also contemplate living or relocating. The potential of a new mindset for society may create new opportunities for regional Australia. Government assistance packages will play a key role in any successful hibernation and restart ability, especially for the tourist destinations within our area.
On the ground, it is way too early to identify any impact on our local property markets. If there is a right now feeling, it is probably a combination of no news is good news coupled with wait and see.
Uncertainty has created a strong pause reaction for those who have the option to do so, such as people about to build, sell, buy or invest. For those grappling with employment or business issues, seeking assistance to avoid negative property related outcomes is front of mind.
Some impact may be absorbed by sales activity usually slowing in the winter months and people will certainly have a lot of time to take on home improvement projects ahead of intentions to mobilise later in the year, typically in spring. Of course, some property decisions are easier to pause or delay than others and we may see a softening in demand for land sales and new builds in favour of established properties. Lower end property values in the Victorian alpine resorts (Falls Creek and Hotham Heights) are likely to come under pressure, especially if revenue from the season vanishes if the season is cancelled or postponed. Other tourist towns in our patch such as Bright, Porepunkah, Myrtleford, Ruthglen, King Valley and Mount Beauty are all at risk of softening due to their exposure to tourism. They are also the best destinations for what we expect to be a significant local tourism demand when travel restrictions ease and people plan getaways in their cars and caravans.
The classification of the valuation industry as an essential service has allowed our team to observe the sentiments of local communities and the common thread is one of resilience and determination in the face of disruption and hardship. All that our region offers will definitely be ready to receive visitors again and to that end, here are a few photos to dilute graph fatigue.
DISCLAIMER: The information contained in this article is correct at the time of publishing and is subject to change. It is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on this information, Smartline recommends that you consider whether it is appropriate for your circumstances. Smartline recommends that you seek independent legal, financial, and taxation advice before acting on any information in this article.