Sydney housing market hinges on length of Covid-19 lockdown

The Sydney housing market may not come out unscathed from its current lockdown if the restrictions stay in place for a lengthy period.

Auctioneer Andrew Cooley drops the hammer on a house in Caringbah South via an online auction.

The Sydney housing market may not come out unscathed from its current lockdown if the restrictions stay in place for a lengthy period without government support, Property researcher CoreLogic has warned.

A new report from the data firm showed the longer social distancing restrictions are in place, the longer the market took to get back to “normal”.

Meanwhile, the “sharp and short” lockdowns preferred in smaller capital cities provide a better floor for activity from buyers and sellers to bounce back from.

While the housing market became surprisingly bullish after the initial autumn lockdown last year resulting in double digit growth over the past 12 months, CoreLogic’s head of residential research, Eliza Owen noted government and institutional responses played a key role in market stability.

“A big part of why the housing market didn’t see further value declines was the enormous income support packages provided to households, the role of JobKeeper in maintaining employment relationships, low mortgage rates and mortgage repayment deferrals,” Ms Owen said.