What COVID-19 Means for Australian Real Estate

Business, Industry News,  Principals

For some asset classes like short stay accommodation and hotels, the impact of COVID-19 has been dramatic and immediate. For other types of property such as residential and commercial, the impact might be more difficult to identify and might perhaps stretch on for years. As we start to sit back and take stock, one thing that is for sure, the impact of COVID-19 on our lives and property is obvious and inevitable. While in regular times, however, there isn’t ‘one property market’ we anticipate that this will also be the case in the current landscape. This begs the question, how might COVID-19 impact different sectors of property in Australia? As part of a survey by Ripehouse Advisory, 146 property professionals, including Antonia Mercorella, CEO – Real Estate Institute of Queensland, responded to a series of questions about COVID-19’s impact on the sector.

“To help paint this picture, we turned to our extensive network of Australia’s most trusted property professionals,” says Ripehouse Advisory CEO Jacob Field. “Identified as key academics, leaders of Australia’s industry bodies and the individual custodians of the various professions as related to property. The opinions and statements in this document provide a frank assessment of a drastically changed property landscape.”

The common theme from the report is that the real estate industry could survive in and after the pandemic. Some of the highlights include:
• Prices will be higher than now in 12 months (27%).
• NSW will be hardest hit (72%).
• Short term rentals will suffer the most, whilst high cashflow and diversified rooming houses on fixed-term leases are the most resilient.
• The peak COVID-19 impact will be felt between 3-12 months from mid-March 2020.
• Areas most impacted by COVID-19 include 76 suburbs which have taken a hit due to the downturn in tourism nationally.

To access the full survey, simply click here.