There’s no question that the global pandemic sent the world into a spin. Here in Australia, we saw lockdown enforced, socially distancing introduced and people sent to work from home while businesses closed their physical doors. Many people lost their jobs in the process, sending the economy into a downward spiral, with it, house prices naturally began to drop leaving the real estate industry in a bit of a trough, bringing much anxiety as people wonder what will house prices be like after Covid.
With the vaccine now available in Australia, we are experiencing the light at the end of a very long and nerve-racking tunnel as we start to breathe again after Covid. But what exactly does this mean for house prices? Here’s everything you need to know about house prices after Covid.
What Will House Prices Be Like After Covid?
It’s always a hot topic whenever trouble strikes: what will house prices do? Let’s face it, house prices affect everything, with millions of Australians tied to high mortgages keeping the Australian economy stable. It’s no wonder it’s such an important topic. Which is why so many people have been asking, what will house prices be like after Covid?
Let’s take a step back to what we saw during the pandemic before we look at house prices after Covid. Even before Covid hit, we were seeing a trend of rising house prices, which means Australians were taking out bigger and bigger mortgages and going even more into debt in the process. If the debt can’t be repaid, it ends up a lose-lose situation for both the borrower and the lender.
With so many people losing their jobs during Covid, this is exactly what we saw. People were unable to pay off their mortgages, which leave them with little choice but to sell. When they sell, the market is weakened and it just gets worse. In order to avoid this from happening, banks offered loan deferrals to Australians who were struggling. The good news? It worked.
Experts say that the decline we saw in house prices during Covid, was nowhere near as steep as other historic market crashes.
House Prices After Covid? Where Are We Now
It seems despite the economic crash we have just experienced when looking at house prices after Covid, things are on the rise.
A combination of low interest rates, record levels of government stimulus support and good saving has seen the demand for property increase, which has led to a rise in housing prices.
According to Real Estate Australia, Aussies are moving out of the city and into regional areas, since they need to be in the city has gone down with everyone working from home. This has driven up the house prices in many suburban areas and led to some of the growth we are now seeing in the market.
Thankfully, Covid didn’t have the impact expected on our property market and the trend is already on the rise. What does this mean for you if you already own a home and what will house prices be like after Covid?
Refinancing Your Home
If you’re struggling to pay off your mortgage, but aren’t interested in selling just yet, or simply want to be paying less – who doesn’t! – it could be worth looking into refinancing your mortgage. It’s the best time to refinance with lower interest rates allowing you to get a much better rate for your own mortgage.
With there being so much concern about what will house prices be like after Covid, here are some reasons you might consider refinancing your mortgage:
- For a more flexible mortgage: refinancing can give you the opportunity to get more flexibility out of your loan. You can pick and choose the exact features you need to make it work for you.
- Access equity in your home: refinancing also allows you to access the built-up equity in your home, which is currently on the rise. You can use this to go on a well-deserved holiday, buy a new car, or even to put down as a deposit for another home.
- Can’t afford your mortgage: if you are struggling to pay off your mortgage, refinancing can help reduce your monthly payments with a lower interest rate. It can be a great option to help you hold onto your home during a rough period and pay less over the course of the loan.
Refinancing Your Mortgage
Now that you understand a little more about house prices after Covid, you might be wondering how to go about refinancing your mortgage. The team at NSW Mortgage Corp can help you out to make sure you get the best deal possible on your new loan.
We want you to benefit as a homeowner and get the most out of your mortgage, which is why you can get a free consultation with no obligation. Simply pick up the phone today and make sure you aren’t overpaying on your mortgage. Our friendly team will be able to help you out.