With the world on high alert due to the Coronavirus pandemic, many home-buyers and investors are surely wondering if now’s a good time to buy a property. With citizens urged to self-isolate and borders closing, travel opportunities are limited, making it harder to book appointments with agents and make ocular visits. Moreover, stock prices have fallen and some workers have been laid off from their jobs.
Consequently, the property market weakened. Many buyers opted to wait out, despite some house prices dropping. So, if you’ve been eyeing some valuable land properties for sale in Geelong or any other area, should you also wait out, or take advantage of the market slowdown?
The Impact of Coronavirus on the Property Market
According to some experts, what Australia is currently experiencing is like a terrorist attack — a short, sharp blow. As a result, a recession is expected, but a rebound is likely to occur by the second half of the year, which will make a perfect storm for a property.
The drawback is that unemployment rates may rise, too, due to the workers who have been laid off from their jobs as the pandemic worsened. This will affect their capacity to buy property, taking them out of the housing market. And if you’re selling, you may also lose a considerable number of potential buyers if they’re having the same unemployment problem.
Fortunately, the government has released stimulus packages to those that will be affected by job losses, so no one will be stuck without a source of income during this difficulty.
For property investors, the impact is greater, since there has already been an ongoing decline on rents even before the coronavirus came into the picture. The lower prices of properties may be favorable, but income will be harder to earn with lessees dwindling. And with this pandemic, further decline is to be expected.
Should You Buy a Property, Then?
If you have a secure job and stable and organised finances, then this is a good time to buy. The price drop is something you wouldn’t have encountered a few weeks ago before the virus’s spread became worse, and in the future when the economy bounces back.
But consider your short-term goals, too. If your purpose of buying a house is to make it a rental property, then you should anticipate a weak market. But if you’re planning to make the house you’re buying as your primary residence, consider Melbourne, where the market is strong, but the vacancy rates lower. The only potential downside is that there may be a lot of sellers who will defer due to cautious buyers.
A Bright Prediction
Since the impact of the virus is just a short, sharp blow, this means that the wound on the economy will just be temporary, and recovery will occur by the second half of the year, at the earliest. For now, employees and small- to medium-sized business owners don’t have much choice but to overcome this difficulty in the best way that they can. They can benefit from the stimulus package, but the effect the virus has delivered on their businesses and income stream cannot be fully compensated by any government aid.
Let’s just try to be as positive as we can. The virus will soon be contained, and with that, the economy will rise and we will all return to our normal lives again. Use this break as an opportunity to rethink and reevaluate your goals. The pandemic may inspire you to equip yourself and your family better for the future.
