A new class of buyer is emerging in the time of COVID-19 – they’re called the contrarians.
Real Estate Buyers Agents Association (REBAA) president Cate Bakos said despite the challenging market conditions and restrictions on open homes and auctions, there were still buyers willing to purchase counter to the market.
“We call this behaviour contrarian,” said Ms Bakos.
“Many contrarian buyers have been waiting in the wings and for those who missed the boat last June, these buyers don’t want to miss out a second time when the next boom hits.
“The hardest part is picking the bottom of the market, but smart buyers should be thinking about market segments, and identifying those which present strong opportunity.”
Ms Bakos said the regional property market would be strong as it would be better insulated from price falls than higher priced stock in major metro areas and aspirational coastal and lifestyle locations.
“Days on market, firm prices, auction clearance rates and numbers of buyers per property are all valuable indicators of market vulnerability, and it’s vital to note that our regions are exhibiting firm demand, short days on market, and strong competitive numbers despite our difficult economic times,” she said.
According to realestate.com.au, a record audience of 10.7 million people was logged in the month of March, indicating strong interest in the property market despite recent lockdown measures.
Ms Bakos said family homes in quality locations would continue to experience buyer demand meanwhile coastal and lifestyle properties could struggle as they were usually the first to go if an owner felt the need to liquidate a holding.
“People will sell a holiday house before they will sell a home,” she said.
“From an investor perspective, lower price point properties that exhibit higher rental returns are considered a ‘safer’ investment option for those who are mindful of employment changes or a reduction in income. A cashflow-positive property can be considered a ‘set and forget’ investment option.
“Higher price-point properties are experiencing more days on market, and we have witnessed some sharp discounting for resultant prices.”