How declining COVID-19 numbers will impact the Australian housing market

The number of people who have contracted the viral COVID-19 is finally declining, the Australian housing market is reflecting that. What does that mean for buyers and sellers? Let's take a brief look at how the real estate market will change as the pandemic continues to shift.

Declining numbers

The reflection of changing pandemic requirements and policies' impact on the real estate market is projected to be positive, especially as indoor mask orders remain in place to protect those who wish to venture back into the world. While the Omnicron virus is still a threat, the number of people in Australia who contract COVID-19 every day is slowing.

A short history of the pandemic's impact

Before the world was turned upside down in 2020, the Australian housing market was on the upswing and there were promising projections for both buyers and sellers of residential property. According to a report from KPMG Economics, "the onset of the COVID-19 pandemic disrupted this cyclical upswing with house prices contracting in all capital cities except Canberra during the June quarter 2020."

As government policy changes in 2022, the real estate market is taking a deep sigh of relief. So what factors impact the price of homes in Australia? The following are a few examples of the kinds of pressures that the housing market responds to:

• Construction costs.
• Inflation.
• Accessibility of development financing.
• Supply and demand.
• Interest rates.

These are just a few of the many, complex factors that influence real estate prices and the overall state of the housing market. The government has been creating policies with the goal of assisting the Australian economy. For example, the Commonwealth Government and the Reserve Bank of Australia (RBA) have done their part to offer support with things like the HomeBuilder Program.

The future of the housing market

November 2021 saw home values rise to 22.2% nationally, which the news publication, Financial Review, reports were the largest annual increase since 1989. Demand was high and the supply was low, among other factors which contributed to the extremely high home prices.

Homes are likely going to be more affordable this year, which is good news for those who have been scouring the market in search of something in their price range. In addition to more listings on the market, the sustained improvement of COVID-19 rates is also likely to positively impact the Australian economy as a whole. To learn more about how to find the right home for you in the 2022 housing market, reach out to a Ray White professional today.