Hopes high return to one-on-one home inspections will unlock supply

The imminent return of one-on-one house inspections is giving the ACT real estate industry confidence that spring can deliver more properties to a booming market desperate for more listings.

The Real Estate Institute of the ACT (REIACT) submitted its risk management assessment last Friday and is awaiting notification from the Chief Health Officer, so inspections could be back as soon as the weekend.

REIACT CEO Michelle Tynan said it would be a step towards at least a COVID-normal spring and help release pent-up demand.

“There are still an enormous amount of buyers out there. We’re still seeing that even without one-on-one inspections,” she said.

Ms Tynan said the change would give greater confidence to consumers, warning against the trend towards people buying online without ever inspecting the property.

“It’s quite concerning that people are buying site unseen,” she said.

“When people get into their properties, all of a sudden there may be issues that weren’t highlighted through a video tour or able to be seen.”

But with so few houses being listed at present in a hot market, the fear of missing out is driving people to take that option.

Independent agent and auctioneer Andrew Potts said he conducted an online auction last weekend for an older-style, original freestanding home in Garran that attracted about 20 bidders, most of whom had not set foot inside the property.

“It’s that type of property there seems to be an appetite for regardless of whether people are seeing it or not,” Mr Potts said.

Mr Potts said everyone had been surprised how quickly the market had taken to virtual inspections and online auctions, but many buyers may feel they have little choice.

He said buyers were watching the market rise by the week and deciding they were better off making a move when they could.

“But these days, with a virtual tour and video walkthrough, they get a pretty good grasp of the feel of a home as well,” he said.

Mr Potts said auctions continued to break records, but in this market, the more prices rose, the less agents were surprised.

He said a return to some form of inspections would help bring out more sellers, but there were not many new listings as yet.

Lockdown had exacerbated what had already been a tight market, something that has characterised the Canberra scene for a couple of years now.

There were signs that spring would produce a bounce. Mr Potts said he was booking a lot of auctions before lockdown, only to see some pushed back, others switch to private treaty and some selling before auction anyway.

He said even with the restrictions, it was a good time to sell because demand was so strong.

Ray White Canberra Ben Faulks believes one-on-one inspections will be enough to unlock new listings and that the high prices will lure sellers back to the market.

Mr Faulks said homeowners would be getting 10 per cent more than they would have six months ago.

He said average bidder numbers last month were 7.5 on 47 auctions, and that was during lockdown.

“And that demand is not going to go anywhere,” he said. “I think supply will return to balance.”

Mr Faulks expected the rest of the month and October to be very busy.

He said demand was strong across the board, from first-home buyers trying to break free of a tight rental market and buying into off-the-plan and secondary apartment markets to families looking to upgrade and, at the higher end, people taking advantage of cheaper interest rates to afford a much more expensive home.

Those priced out of the standalone house market would fall back to townhouses and apartments, sectors Mr Faulks believes will outperform houses over the next 12 months.

Mr Potts also believes that overflow from the house market will boost those sectors.

“The closest thing they can get to a house is probably their preference,” he said.

Ms Tynan said many people who were looking at a units lifestyle a few years ago were now looking for more space as a result of the pandemic.

“People in lockdowns are reassessing their living dreams and where they want to live,” she said.

The industry expects it will be some time before pre-COVID open houses and site auctions return.