While we haven’t got a crystal ball, and who can predict what the market will do, here are some thoughts from our Director Craig Andriessen J.P. on post-COVID property trends:

1. Lifestyle choices

While many people were unable to work throughout the lockdown, there were quite a few businesses which leant themselves to working from home, and many employees have got to like it. We suspect there will be quite a few people rethinking their lifestyle.

This potentially could see the now permanently home-based workers heading to regions for a better lifestyle, but still within a reasonable commuting distance of the city. And Newcastle fills the gap.

With its fantastic location, revitalised CBD and good transport infrastructure, as well as good higher educational and many different work opportunities, Newcastle is definitely on the map as a desirable place to live, study, and work.

2. Desirable features

Over the past few years, outdoor entertainment spaces and open plan living have increased in popularity. However, with more people working from home, we think having a home office and multi-purpose space will move up the ‘must have’ tick list.

If people are leaving the large Capital city for a more affordable lifestyle, they will potentially be looking for more bang for their buck, in the form of bigger houses and more rooms.

3. More downsizing

Financial stress will affect some older Australians, who are potentially facing job losses due to a company cutting staff and/or their business not surviving the lockdown. Furthermore, with superannuation also diluted, they will be looking at options.

If the kids have left the nest, they may well consider now is the time to downsize.

Those aged over 65 can use their downsize to contribute up to $300,000 extra into their super (each) from the sale proceeds, and in the meantime, they can find a smaller, less expensive property, which is cheaper run to live in.

4. Intergenerational living

While the job/business losses and financial stress will see some people looking for alternative independent accommodation, others may feel they’d like to spend more time with their family.

Young renters are already moving back home with mum and dad to save money, but we also may a change at the other end of the generational spectrum; financially strapped older Australians may well decide to move in with their adult children.

Furthermore, the HomeBuilder program might just be the extra incentive needed to start the building the extension.

5. Granny flats

With uncertain economic times ahead, some property owners may well look at how they can increase income independent of their usual line of work; building a granny flat to rent out could be the answer.

The NSW government defines a granny flat as a self-contained extension of a home that is within, attached or separate from the home but on the same lot of land, and not in a strata plan or community title scheme.

Although the building will need to comply with certain standards, a council or accredited certifier can certify granny flats as complying development without the need for a development application.

6. Increase use of technology

No, we’re not talking installing smart meters or lighting, we’re talking technology playing a larger part of the selling and buying process; we practically adopted high-tech work tools overnight.

We’ve had to think beyond the team working from home, with transferring calls and zoom meetings, to how we can operate in this post-COVID world. We are already offering virtual property tours for both buyers and tenants, and the industry is adapting to holding property auctions online.

What should investors do?

While some landlords have experienced adjustments to weekly rents on re-lettings and/or a tenant unable to pay, it is short term and, unless they absolutely need the money now, many investors are sitting it out. Furthermore, with the interest so low, there are investors looking at raising capital to expand their portfolio.

We don’t know what the economy is going to do in the coming months or years, but property is an investment that has stood the test of time – after all, everyone needs somewhere to live. We’ve been in business for over 40 years now, so we truly believe bricks and mortar are still a good investment.

If you would like to know more about our thoughts on the market and want to know more about how our property management services can assist you, give us a call on 02 4956 9777 or send us an email to mail@newcastlepropertymanagement.com.au.

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