John McGrath - Property Trends Beyond COVID-19
Many Australians will be making new choices about how and where they live, borne out of financial necessity for some or a long dreamed about lifestyle change for others.
Here are the trends I see for the future as we emerge from the Covid-19 pandemic.
More multi-generational households
Job losses and financial stress will bring families together.
We’re already seeing many young renters moving back home with mum and dad.
Older Australians who don’t want to re-start their businesses might also consider moving in with their children and grandkids for a change of pace.
If there’s not enough room already, the HomeBuilder program might help fund the necessary extensions.
Empty nesters downsize earlier
Some empty nesters will downsize earlier because their businesses won’t survive.
With their superannuation also diluted, cashing in the family home might be the most appealing option.
Those aged over 65 can use their downsize to contribute up to $300,000 extra into their super (each) from the sale proceeds.
Working from home in lifestyle locations
A large contingent of permanently home-based workers will likely head to the regions for a better lifestyle within commuting distance of the city.
You can expect the Byron, Central Coast and Illawarra regions of NSW to be beneficiaries, as well as Noosa and the Gold Coast in Queensland.
ACT workers might like a treechange to Goulburn or a seachange to the NSW South Coast.
In Victoria, there are many commutable options including Ballarat, Geelong and the Dandenongs for example.
In the cities, inner garden suburbs like Sydney’s Haberfield, Australia’s original ‘Garden Suburb’, will be in high demand from newly at-home workers.
These suburbs offer bigger homes on larger lots with space from the neighbours, leafy streets and public parks and all just 15 minutes from the CBD.
Investors take short term pain for long term gain
There may be some short term pain now, with material adjustments to weekly rents on re-lettings.
Financially stressed landlords will sell their investments before their homes, however low interest rates are helping the majority to hang on to their assets for now.
Cashed up investors whose businesses are going well might want to expand their portfolios, with loan rates at 2-3 per cent and returns at 3.5-4 per cent.
Technology makes it easier and more efficient
Covid-19 forced every agent to adopt high-tech work tools overnight.
Online auctions, greater use of virtual tours, meetings via zoom and streamed inspections are now the way of the future.
This will make it easier than ever before for people to research, buy and sell property.
More overseas buyers
Our agents sold half a dozen or so properties to people overseas who couldn’t inspect them during the lock down, which shows just how good the buyer experience has become online.
Ten years ago, buyers had photos and a floor plan, now there’s drones, videos, virtual tours and live streaming.
The Australian dollar is also very attractive and I think we will be seen as a safe haven once again.
Work from home will influence design
Designated home offices, home gyms and multi-purpose spaces will be the new must-haves.
Home owners will be more mindful of creating safe, adaptable environments that are pleasant to work in.
Those who depart cities for affordable regional areas will want big houses with lots of extra rooms.
It’s been a devastating time for the world and it’s not over yet, with many of the economic ramifications yet to play out.
Meantime, many people are reassessing their lives and considering what silver linings are there for the taking.
I hope today’s column inspires your next move!
This article originally appeared in The Real Estate Conversation (June 15, 2020)