Auctions and open for inspections banned under sweeping coronavirus restrictions

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National Cabinet Meets To Discuss Further Measures In Response To Coronavirus Pandemic  Auctions and open for inspections banned under sweeping coronavirus restrictions capi 7e193b1d368f82b6725528be9797f65d 06dbe8f2f55aaa243612a2fe3240c21c

Prime Minister Scott Morrison announced real estate changes for midnight Wednesday. Picture: Sam Mooy/Getty Images

Property auctions will be banned from midnight on Wednesday under a new suite of measures aimed at curbing the spread of coronavirus.

Prime Minister Scott Morrison announced Tuesday night auctions and open for inspections would have to stop.

“Real estate auctions and open house inspections … that cannot continue,” Mr Morrison said.

The Prime Minister was not clear on how long the restrictions would be in place but the ban on both on-site and in-room auctions effectively puts much of the real estate market on ice.

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The announcement was part of a string of tougher restrictions on gatherings of people, such as closing food courts in shopping centres.

It is not clear how the significant change to selling property will affect the housing market as agents have already begun to offer online bidding services and virtual property tours.

There will likely be a dramatic drop in the number of listings, but housing experts warned lower transaction volumes would not necessarily mean prices would drop.

My Housing Market economist Andrew Wilson recently told The Daily Telegraph “discretionary” sellers would be largely insulated from changes in the market because they could postpone their sales if need be.

Those who were forced to sell for reasons such as divorce would have to accept whatever price the market offered, he said.

The housing market has been remarkably stable in the past few weeks given the uncertainty over coronavirus. Last week, auction clearance rates in Sydney and Melbourne hovered around 60-65 per cent.

This was higher than over the same period last year, when clearance rates were within range of 50 per cent.

Realtor outside home for sale with real estate sign.  Auctions and open for inspections banned under sweeping coronavirus restrictions capi 7e193b1d368f82b6725528be9797f65d 326abba2f4b79fce52f18e935a06e1ef

Agents should be able to adapt with private inspections.

Real Estate Institute of Australia president Adrian Kelly said he expected one-on-one private inspections to become the norm. Auctions could be conducted via telephone bidding or online bidding, he said.

Some agencies had already announced attendance at auction this week would be restricted to registration only.

Prominent auction houses such as Cooley Auctions have been streaming all their auctions online through platform Auction Now.

Cooley Auctions founder Damien Cooley said some auctions last week attracted only online bidders.

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The restrictions could put much of the market on hold.

Ray White group managing director Dan White said sellers would have to adapt.

“The key message to take away is that all real estate onsite and in room auctions and open house inspections will be cancelled as of Wednesday night, but our members will still be able to host virtual property tours, private inspections and online/digital auctions, as we have been encouraging,” Mr White said.

The Prime Minister said the question of leases is set to be considered by the national cabinet in its next meeting tomorrow night.

There were hopes the cabinet would announce rent relief for tenants struggling with the economic fallout of the virus, but no announcement was made on Tuesday night.