Spring home sales wilt as post-lockdown blooms

The pandemic has officially killed off one of Australia’s favourite seasonal pastimes - buying or selling your home amid the sunshine and fresh garden blooms of spring.

After the big lockdown last year, within two weeks volumes were higher than pre lockdown levels.Credit:Peter Rae

Lockdowns and restrictions on gatherings imposed across the nation are not only limiting traditional home auctions, they have spread home sales across the year, wiping away the focus on spring, once the busiest time on the real estate calendar, according to ASX-listed e-conveyancing firm PEXA.

“It has fundamentally changed,” said PEXA chief executive Glenn King.

“Before it was far more seasonal. Now we are seeing record volumes coming in when we would not normally have expected them.”

Instead, home sellers now flood the market when a lockdown lifts.

“As soon as Melbourne opened up after the big lockdown this time last year, within two weeks volumes were higher than pre-lockdown levels,” the firm’s chief financial officer Richard Moore said.

Before it was far more seasonal. Now we are seeing record volumes coming in when we would not normally have expected them.

Pexa chief Glenn King

“That weight of properties that hadn’t come to the market, they all came in a two to three-week period.”

PEXA, which listed on the stock exchange six weeks ago with a market value of $3.3 billion, is not seeing a fall in property transactions, despite the uncertainty and difficulty in key markets like Sydney and Melbourne of holding house inspections.

In fact, lockdowns have helped accelerate the shift away from paper property transactions to digital transfers, boosting its business, it said.

“We went into lockdown and it didn’t drop off as dramatically as what people would have thought. What we also did see, is that there was a bounce-back,” Mr King said.

Millions of land titles and mortgages are now exchanged or refinanced on the electronic conveyancing platform. Transactions, a key measure of property market activity, were up 37 per cent to 3.3 million over the year.

The significant jump in volumes saw it post a 42 per cent hike in revenue for the financial year to June, to $221 million.

PEXA expects to open its exchange in the Australian Capital Territory this financial year after growing its stranglehold of property transfers in the key eastern states of Queensland, NSW and Victoria to 80 per cent of the market.

Mr King said momentum was building behind PEXA’s push to enter the UK market with a similar property transfer platform, a key growth strategy for the company.

He said the firm will maintain its 2022 financial year forecasts of $247 million in revenue.

Other property companies are also seeing strong bounce-back from shopping-starved customers when restrictions ease.

Australia’s largest retail landlord Scentre Group, which owns and manages Westfield malls across the country, predicted shoppers will flood back to its shopping centres once national lockdowns are over and the majority are vaccinated.

Sales in its malls bounced back strongly in the first half of this year when restrictions lifted.

Home sales are also holding up “remarkably well” in Sydney and Melbourne, Mr Moore said.

“We’re not seeing anything that’s really concerning us around August or September which is probably the line of sight that we have,” he said.

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Simon Johanson is a business journalist at The Age and The Sydney Morning Herald.

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