…so Australia is coming out of its Covid 19 hibernation in feeling much more confident than we expected. What does it mean for those looking to buy property?
In signs of confidence in the property market, this weekend saw clearance rates almost at the optimistic levels in our property markets before Coronavirus hit us – many of our capital cities sold 70 per cent of their properties at auction this weekend.
Australians have been shocked by the deaths in Wuhan, Rome and New York but also felt a strong sense of relief that our health and economy have been able to withstand the pandemic.
As a result, Australians are increasingly feeling confident about the future.
Undoubtedly one reason for this is the decisively positive ways our governments have responded. The JobKeeper stimulus package is worth 13.3 per cent of the country’s economic output.
And, though embarrassing, the federal government has just discovered it has $60bn spare it can spend to boost the economy
And because, the Coronavirus appears relatively well contained, Australia can now take the foot off the economic brakes with greater confidence than other countries. As more and more businesses re-open for business, research from Illion and Alphabeta shows that consumer spending is now only three per cent below pre-crisis levels
The banks also have had a hand in maintaining confidence. Once seen as the bad guys, the banks have extended lending by pumping liquidity into the economy by
- Offering business loans to boost cashflow
- Honouring loan approvals to those recently furloughed
- Extending interest only periods without requiring applicants’ financial circumstances to be re-assessed
- Boosting their hardship offering to those borrowers struggling to make ends meet
The brokers are Origin Finance remain as busy as ever. Indeed, many of our more savvy clients are using this period to buy properties at great prices.
Undoubtedly we are a long way from boom periods – and we are likely to remain so until the borders re-open and we see Australia return to growth rates of c300,000 people a year.
Ands its unclear what happens come September when JobKeeper and JobSeeker are wound back.
But we can have confidence.
Maybe we remain the Lucky Country after all…?
Graeme Salt is a leader of The Futurus Group whose main brands comprise Origin Finance, Chan & Naylor Finance as well as Walker & Miller Training. For a no-obligation consultation on your borrowing needs, please contact Graeme on 1300 30 67 67