Will an influx of properties hit the market as the rental moratorium ends 28th March?

28/03/2021
Will an influx of properties hit the market as the rental moratorium ends 28th March?

Many owners have asked me how the ending of the rental moratorium on March 28th will affect the property market.

I feel that supply will slowly increase as landlords are no longer restricted by law on what they can do with their property.  However, they will only sell if their properties were to break even or make a small profit.  If this were not the case, they would continue to enjoy the increased rents in the meantime while they wait for the anticipated increase in the price of their properties.

More stock for houses will come to market than apartments since the biggest price gains have been in houses in the last six months.  In some suburbs, the median house price is getting close to the mining boom price and could exceed that peak price in the next couple of months.  This will make houses in these suburbs more palatable for owners to sell as they won’t see themselves selling at a loss.

Apartments on the other hand have only really recovered back to their pre-Covid 19 prices.  I  think it will be another 12 months before they start to make substantial price increases to challenge the peak prices during the mining boom.  Only then will a majority of investors start looking at selling their apartments.

When the moratorium ends, there is an expectation that rentals could increase up to 25%.   This has caused many tenants to consider buying their own property as record-low interest rates make buying extremely affordable compared to renting.

I expect that any increase in supply to the market will be quickly soaked up by the increase in demand from these existing renters looking to now buy instead of rent.

If you have an investment property and are not sure what it’s worth in the current market, please contact me for an up to date appraisal.  Property values have substantially changed in the last three months, and you may be surprised by what your property is actually worth.

As always if you need help with your property please give me a call.  I am always happy to help.

Regards

Chris Pham
Licensed Real Estate Agent
Mobile: 0448 777 511
Email:  cpham@realmark.com.au