Melbourne house prices are proving to be stable even in the midst of the pandemic. But it’s not without rhyme or reason that, while other sectors and even other property markets across Australia have declined, Melbourne house prices are holding.
Property market experts explained that the low sales volumes and the government support to both business and individuals have been effective in keeping the values steady.
Sales volumes have been down by about 40% year-on-year though more Melbourne properties are expected to be on offer for sale later. As well, the government financial support will not go on forever. Not discounting these facts, however, experts believe that Melbourne house prices may fall but will surpass expectations at this time of COVID-19.
Historically, Melbourne’s property market has suffered through cyclical economic conditions. During the 1990 unemployment crisis, values fell by about 8%. Similarly, during the Global Financial Crisis in 2008, Melbourne house values took a downward hit by 3 to 4%.
Take a look at the graph below:
The figures will show us that leading to both the 1990 and 2008 crises, Melbourne house prices have begun to rise.
In comparison, before COVID-19 hit, house values in Melbourne have just started to show a recovery. House prices are not inflated, resulting in a relatively stable market with changing economic conditions not quite compounding impacts of COVID-19.
This suggests that if COVID-19 did not happen, Melbourne would enjoy a very strong property market today.
Today, with COVID-19 holding the economy and nearly every business in Australia hostage, experts still look forward to potentially long-term growth in the Melbourne property market. There is hope that though house values may likely fall soon, Melbourne house prices will quickly recover as soon as life returns to normal.
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