Auction super weekends hit by coronavirus concerns

New bans are likely to cause prices and the number of new homes coming on the market to tumble.

Auctioneer Richard Baini at the Richard Matthews Real Estate agency in Strathfield. Picture: Christian Gilles

New bans on in-person auctions and open homes are likely to cause prices and the number of new homes coming on the market to tumble as economic and unemployment concerns take hold.

The next two Saturdays were poised to be super weekends for auctions as the market prepared to break for Easter. Instead, agents and vendors are working quickly to pull forward campaigns and sell properties privately or digitally as coronavirus concerns target the marketplace and cause the traditional selling methods to be axed.

Prime Minister Scott Morrison announced on Tuesday night a new phase of social gathering crackdowns which included a stop to public auctions on-site and in-room alongside open homes for the foreseeable future. Private inspections are still allowed to go ahead at this stage.

“In the retail space, auction houses, gatherings together in auction rooms, that can no longer continue,” Mr Morrison said. “Real estate auctions and open house inspections – in particular, open house inspections – that cannot continue,” he added.

Auction campaigns are largely held in Sydney, Melbourne and Canberra and represent only a small proportion of the total number of listings. Smaller markets generally hold far fewer with a more volatile success rate.

Century 21 chairman Charles Tarbey said many of the auctions scheduled for the coming few weeks are likely to move to a traditional private treaty campaign or a digital auction unless the seller decides to wait until the other side of the coronavirus outbreak.

“We are probably looking at super Wednesday, Thursday, Friday and Saturday coming up,” Mr Tarbey said.

“I just think those sellers that genuinely want to sell, will sell. There will be some that will want to withdraw because they think they won’t get the price they want.

“But, you don’t know what the results gonna be. So rather than take it off the market, let the process occur and then you can make a decision after that - you don’t have to take an offer if you don’t want to,” he said.

The decision to pull the pin on real estate gatherings was a move many in the industry had been readying for.

National network Ray White pre-emptively announced all auctions would go digital from Tuesday.

Others, including McGrath, The Agency and Century 21 had been making greater use of live streaming, telephone auctions and online bidding platforms to secure deals.

Despite provisions, market activity and prices are both set to fall as unemployment and economic uncertainty start to bite down on consumer confidence.

The Agency’s head of sales, Thomas McGlynn, said the auction numbers would likely be impacted over the next two weeks, but that would be lessened by an uptake in online marketing and sales.

“It’s gonna have an impact on auction numbers at least up to Easter. However, there are still genuine reasons and options available to sellers and buyers who are willing to transact,” he said.

“In the environment that we’re moving forward into, the private remote auction allowing the auctioneer to go ahead with technology and allowing people to sign when they’re not present is probably the best way to be able to get a result while minimising the contact between people.”

Search activity on classifieds portal realestate.com.au has fallen over the past two weeks but still remains higher than the same time last year.

While the result shows buyers are still actively looking to move home, the site’s chief economist, Nerida Conisbee, said she was surprised that the weekend’s preliminary clearance rate of 63.1 per cent held up as well as it did.