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Almost three-quarters of property investors remain confident in the housing market’s short-term prospects despite the ongoing COVID-19 pandemic, a new survey has found.
A survey conducted by the Property Investment Professionals of Australia (PIPA) and the Property Investors Council of Australia (PICA) in mid-May found that 72 per cent of investors remain confident about the market’s short-term prospects, believing that it is currently a good time to buy.
According to the survey, conducted on 1,877 investors across Australia in September last year, current investor sentiment is down 10 percentage points in the eight-month period.
However, the survey also found that the COVID-19 pandemic had not impacted the investment intentions of 80 per cent of the respondents over the next six to 12 months, with 30 per cent stating they were actually more inclined to buy in the COVID market.
PIPA chairman Peter Koulizos said the survey showed that investors were overwhelmingly optimistic about the property market over the next year.
“Nearly 60 per cent of respondents indicated that the pandemic had not made them change their investment plans over the next six months, with a further 18 per cent saying the crisis had actually made it more likely they would purchase a property over that time frame,” Mr Koulizos said.
“The survey results also showed about 30 per cent of investors were more likely to buy a property in the next six to 12 months because of the pandemic.”
PICA chairman and broker Ben Kingsley said only a small percentage of respondents (5 per cent) indicated the crisis had made it more likely that they would sell a property over the next six to 12 months.
“What’s more telling is that more than 30 per cent said they were less likely to sell over the same period because of the pandemic, with 63 per cent indicating no change at all to their plans,” Mr Kingsley said.
“Most investors also indicated that they had the financial buffers to see them through the current economic uncertainty.
Mr Kingsley stated that the survey results “definitively” show optimism in the investor space, as well as a “business as usual attitude”.
The survey results indicated that about 20 per cent of investors had their tenants request rental relief during the pandemic, with temporary rent reductions or rent deferrals being the most common outcomes.
The results also showed that about 15 per cent of all tenant rent requests were unable to provide supporting evidence as per the relevant temporary residential tenancies legislation.
“However, it’s clear from the survey that landlords worked with tenants who were suffering genuine financial hardship during these difficult times, with only a very small percentage not coming to a mutual agreement,” Mr Kingsley said.
“It’s also clear that a significant percentage of investors were suffering financial stress due to their own loss of employment or reduction of work hours, at 36 per cent of survey respondents, but were still able to meet their financial commitments.
Mr Kingsley concluded: “Investors are confident about the times ahead, with many intending to purchase over the next year to take advantage of the burgeoning buyer’s market.”
Hannah Dowling, The Adviser, 29 May 2020