Coronavirus restrictions: What it means for real estate

The Prime Minister announced tough new restrictions on the real estate market as part of a fresh crackdown designed to stop the spread of coronavirus.

Prime Minister Scott Morrison has announced tough new restrictions on the real estate market as part of a suite of measures designed to stop the spread of coronavirus.

Addressing reporters on Tuesday night, Mr Morrison said auctions and open houses would be banned from midnight Wednesday.

“Real estate auctions and open house inspections … that cannot continue,” the PM said.

Mr Morrison did not make clear how long the ban would be in place.

The announcement was part of a string of tougher restrictions imposed on gatherings of people that included closing food courts in shopping centres and shutting down beauty therapy businesses.

Weddings will be confined to five people — the couple, their celebrant and witnesses — and funerals can only have a maximum of 10.

The significant change to selling property is likely to throttle the market and send prices falling, despite interest rates being at a record low.
Auction clearance rates had already began to fall last weekend, with uncertainty surrounding the virus seemingly dampening buyer enthusiasm.

Some experts have predicted house prices will fall 20 per cent as a result of the outbreak.

Prelim Domain auction clearances
Syd 65% =final ~58%, yr ago 52%.
Melb 62% =final ~57%, yr ago 50%.
Sales momentum is slowing significantly.
Coronavirus driven social distancing & rising uncertainty around the econ outlook looks to be impacting.Expect price falls ahead #ausecon

— Shane Oliver (@ShaneOliverAMP) March 21, 2020

The Reserve Bank cut the official cash rate by a quarter of a percentage point to a record low of 0.25 last week in an emergency meeting.