New restrictions on the inspection of occupied properties for sale could see hundreds of Victorian buyers with no place to live, amid warnings that sanitary measures to control the coronavirus could halt the housing market in its tracks.
Homeowners who bought a new home before the outbreak and now have to sell their current homes are worried about finding buyers – many are probably hesitant to make an important financial decision based on a virtual tour. But securing a buyer is a key step to put the finances in place to continue.
Victoria’s health director even banned private inspections of homes where people live on Thursday night, a decision posted on the Consumer Affairs website. He came with a warning that temporarily leaving home to facilitate an inspection is not an excuse under the stay-at-home rules designed to slow the spread of the coronavirus.
“Many people in our society are truly faced with the prospect of being displaced”, Hodges CEO Carmel Kellett said Field.
“There have been hundreds of people in the past 30, 60, 90 days who have sold their property and they have a real need to buy another house or rent a property, and we are depriving them of the ability to do exactly that.
“There is not a single example that I have where both parties have not seen a property [in person] and bought a house. “
She highlights the risks of making a much smaller online purchase. “When I bought a dress online … invariably, it didn’t look like what I thought.”
David Izzard and his growing family are among those who bought before the world changed and are now worried about the new rule.
“We saw this as a major obstacle to our ability to expose our home to potential buyers, as we obviously need to have a place to live in the interim until our new home settles in,” said M Izzard. Field.
“If we cannot sell, it has a significant financial impact on us, one which I think was not envisaged when this rule was applied.”
With wife Sarah Thorpe and two-year-old daughter Abby, the family is moving from their two-bedroom building in Surrey Hills, but they don’t yet know what will happen to interested buyers who have been in touch and who wish to inspect the property next week.
Real estate agents have struggled over the long weekend to let sellers know that their homes can only be seen by virtual tour, or if the owners move, which raises the question of where they would go.
Several have estimated that the proportion of homes that are usually sold while they are still occupied is 90% or even more, and are not convinced that the public will adopt virtual inspections for such an important financial decision.
And in a context of weakening economy, sellers in the market are now likely to sell because they have to, not because they are hoping for a bargain.
Tim Heavyside of Fletchers said common reasons why sellers are listed include divorce, debt and death, as well as interstate moves or long-planned owners who have already bought and are now selling.
“No one sells out of greed,” he said. “Nobody says,” you know what, I’m going to sell now, I’m going to make a big bundle of money and put it on the stock market. “
Ghost Consumer Minister Neil Angus called for a balance between protecting public health and the continued ability of homeowners to buy and sell.
“In these very difficult times, sellers may need to sell properties quickly, but it will be much more difficult if a reasonable and viable approach to property inspections is not adopted,” he said.
“The community understands that these are unprecedented times, but everything that can be done to ensure that Victorians are still able to see, buy or sell property, without compromising public safety, must be made.”
Buxton chief executive Nathan Jones warned that the decision would affect the ability of some Victorians to find shelter.
“The general public who bought, sold or are completing a lease need a place to live,” he said.
“We believe this decision has seriously affected the general public’s right to shelter, making it very difficult for the average Victorian to find a new place to live, buy or rent.”
Tenants would be particularly affected if they had to move to a cheaper property after losing their income, he said, adding that no one should have to rent or buy on the basis of a virtual tour.
The owners of Melbourne, Brian and Marg Beary, consider themselves among the luckiest.
They were moving to Queensland, having bought a home last year while Marg was retiring from school.
With their Surrey Hills home on the market for three weeks already, they will have to cancel inspections scheduled for next week, but hope they have enough interest to close a sale.
“We are really lucky because we just slipped before all the changes,” said Ms. Beary. “People will not buy online.”
Selling through Mr. Heavyside, she praised agents’ compliance with the rules of social distancing which mean that all inspections are individual, without touching the surfaces and careful disinfection of houses.
With Noel Towell