Melbourne’s stage four COVID-19 restrictions have significantly changed the way the real estate sector can operate.
Notably, home inspections and auctions can only be carried out online, and the construction industry has been scaled back in the effort to curb infections.
Here’s a rundown of what the Victorian Government says market participants can and can’t do during the hard lockdown, which is due to last until September 13.
Can I sell my home? And should I?
You can put your house on the market for private sale or auction, but all inspections and auctions must be carried out remotely.
Real Estate Institute of Victoria president Leah Calnan said the ban on physical inspections would prompt many would-be buyers to pause their searches as “purchasers don’t buy properties from virtual tours”, making it a challenging time to list.
Adding to the difficulty is the fact photographers, videographers and stylists cannot attend homes to prepare a listing. Real estate agents are also not allowed to visit properties to film inspections, leaving the vendor as the only option to virtually guide buyers through their home.
Searches for Victorian residences for sale on realestate.com.au plunged 13.3 per cent in the first week of stage four restrictions. This was the state’s largest weekly decline this year.
REA Group’s Cameron Kusher expected search activity to “start to rebound as COVID-19 cases come under control and the lockdown period comes to an end”.
Can I buy a home? And should I?
Property purchases can still take place. But would-be buyers can only view homes virtually.
Real Estate Buyers Agents Association president Cate Bakos said buyers who had already physically inspected properties prior to lockdown could safely proceed with purchases, noting they may even “get a good deal”. But she advised against buying a property without inspecting it in person, as while a home “might look good in the video and photographs, (it) can feel very different in the flesh”.
Budding buyers should use the lockdown period to obtain loan pre-approval, research their target suburbs and form relationships with real estate agents, Ms Bakos said.
Can I settle on a sale?
Yes, if you’ve already committed to settling during the stage four lockdown period, you can proceed. Services relating to a property settlement — including property valuations, pest and building inspections, pre-settlement inspections, and contact-free key collection — have been approved as permitted activities.
Can I end a lease and start a new one?
Yes, Ms Calnan said services relating to ending a lease and starting a new one were permitted, but the process must be carried out as efficiently as possible.
This meant property managers could go to their office, collect keys and other documents, and then attend the rental property. While there, they could carry out a final inspection for the outgoing tenancy, and then prepare for the next tenancy by filming a virtual inspection and installing a lockbox for contact-free key handover.
Ms Calnan said tenants could give 28 days’ notice and vacate within the lockdown period. Tenants ending a lease are permitted to use removalists, and also professional cleaners if required due to disability, impairment or their tenancy agreement.
Melburnians should only start a new lease if it would be unsafe not to, according to the government.
Can I move house?
Yes, if you’ve already arranged to move. But the 8pm-5am curfew hours still apply.
Members of your household can help you move. Friends and family who are not part of your household can only help you move if you and those you live with are not physically able to because of age, health or disability reasons. You must stay at least 1.5m apart, wash your hands regularly, wear face coverings at all times and not share food or drink.
Removalists are allowed.
Where possible, the government is encouraging Melburnians to delay moving until stage four ends.
What is the situation in regional Victoria? Regional Victoria, including Mitchell Shire, is under stage three restrictions. Auctions must be online.
Physical inspections of homes are allowed by appointment. Only the person inspecting the property and a real estate agent can be present. The resident must temporarily leave their home for one of the reasons permitted under the stay-at-home directions.
Can Melburnians inspect properties in regional Victoria?
No, metropolitan Melbourne residents cannot travel to areas under stage three restrictions to inspect properties.
I can’t afford to pay my rent anymore, can I seek a rent reduction?
Yes, if you’re struggling financially due to COVID-19.
Tenants Victoria chief executive Jennifer Beveridge advised tenants in this situation to work out how much rent they could afford to pay and try to reach an agreement with their landlord or property manager. Tenants should not stop paying rent altogether, and should get any agreement in writing. They should then register their agreement with Consumer Affairs Victoria (CAV) to gain access to “support and protections”.
More than 17,500 rent reduction agreements were registered with CAV by July, at an average discount of $155 per week or 27 per cent, a Victorian parliamentary inquiry report showed.
Ms Beveridge said tenants who couldn’t strike a fair agreement should use CAV’s formal mediation process.
Rental increases are also banned in Victoria until September 29.
Can I be evicted from my rental?
A moratorium on residential and commercial evictions remains in place until September 29. Evictions are only permitted if a tenant is engaging in threatening behaviour or maliciously damaging a property, or if a landlord is selling the home or they or their family need to move into it. When this publication went to print, the Victorian Government was yet to confirm an extension to the moratorium. But Premier Daniel Andrews has said he would have more to say on this soon.
I am a landlord and my tenant has asked for a rent reduction, is there any support for me?
Landlords who reduce rents for tenants in coronavirus-related hardship are eligible for a 25 per cent discount on their land tax as part of a $420m Victorian Government package announced in April. Any remaining land tax can be deferred until March 2021.
An $80m rental assistance fund is also available for tenants who are still paying at least 30 per cent of their income towards rent following mediation with their landlord, and who have less than $5000 in savings. Assistance payments go directly to landlords.
Can I continue renovating my home?
If you are living at the property, the renovation needs to pause once it’s safe and urgent issues are resolved.
If you have moved out, the renovation is treated as small-scale construction, for which a maximum five people are allowed on site.
Can tradies come to my house?
Yes, but only for emergency repairs. Mr Andrews said earlier this month: “There’ll be no cleaners going to your house. There’ll be no one mowing your lawns. It’s not the time to be painting your house or having unnecessary, non-urgent work happen.” You must keep at least 1.5m distance between yourself and the tradesperson and wear face coverings.
Can my new home build continue?
Yes, this falls under small-scale construction for which a maximum of five people are allowed on site.
How will the stage four restrictions impact the residential market?
Property experts expect very few new listings and sales to occur during the stage four lockdown.
Earlier this month, CoreLogic head of research Tim Lawless said low levels of activity — coupled with low interest rates, government support measures like JobKeeper and mortgage holidays — had so far insulated Melbourne from significant price falls, with home values shedding 3.5 per cent since March. But he warned this decline could deepen, with consumer sentiment diving and “urgent sales” becoming more likely.
But Ms Bakos reminded would-be buyers and sellers the restrictions were temporary: “(They) need to keep that in perspective and use this time wisely.”
Ms Calnan also noted many of the real estate sector directions were only in place until August 16, at which point they could be amended.
Author: Samantha Landy
Source: Herald Sun
