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Aussie property listings are being discounted on a mass scale because of COVID-19

Published: (Updated: ) in Australian News by .

The number of properties for sale with a discounted price almost doubled compared to the same period last year.

Property prices for houses up for auction across Australia were dramatically slashed during April as agents rushed to clear stock during the COVID-19 pandemic.

New analysis by Domain's Senior Research Analyst Dr Nicola Powell reveals in markets like Sydney, the proportion of live listings which had their prices discounted has almost double compared to the same period last year.

In April 2019, when nobody had heard of coronavirus, 6.7 per cent of live listings had their prices discounted.

READ MORE: Property market Australia: auction clearance rates rise as coronavirus measures ease

In April 2020, with a ban on on-site auctions and social distancing, that figure almost doubled to 13.1 per cent of live listings.

The steep decrease was even worse in Melbourne, which registered 10.7 per cent of live listings discounted compared to just 3.7 per cent 12 months ago.

Adelaide had the third highest proportion of discounted properties at 8.3 per cent, more than double the rate last year.

Dr Powell said most capital cities experienced a peak in discount listings in March.

"As social distancing rules escalated and an economic shutdown became a reality, the impact was immediate on certain market indicators with vendors adjusting prices being one," she said.

"The economic uncertainty and looming job security fears forced many sellers to drop their asking prices.

"The rising portion of discounted homes aligned to the shutdown of non-essential services, the temporary ban on on-site auction gatherings and open inspections and this trend was consistent across all Australian capital cities."

While the idea of discounted listings sounds tempting, Dr Powell said the data suggests agents are making only small price adjustments on a wide variety of homes.

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"Sydney and Melbourne may have more properties discounted but the degree of discount is smaller compared to last year," she said.

"In April 2020 homes were discounted by 4.3 per cent and 3.7 per cent in Sydney and Melbourne respectively, while in April 2019 they were discounted by 4.9 per cent in Sydney and 4.6 per cent in Melbourne.

"These early signs suggest a broader market slowdown with more properties discounted by more marginal amounts rather than hefty discounts on fewer homes."

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Source: 9News https://www.9news.com.au/national/coronavirus-australia-property-listings-being-discounted-on-mass-scale-during-covid19/91906737-4191-4134-865a-af5e65e5c74d

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