You are here

Sydney to resume property auctions as virus curbs are relaxed

BT_20200504_KELAUCTION4631X_4106504.jpg
Individual inspections of properties are rare in Australia's major cities, with realtors typically putting homes on show twice a week to encourage as many people as possible to visit.

Sydney

SYDNEY will allow open-house property inspections and public auctions to restart from next weekend in the latest easing of restrictions introduced to curb the spread of the coronavirus.

The move will be a major boost for the New South Wales property market, which has seen transaction volumes collapse as social-distancing measures brought an end to traditional selling practices.

Unlike other countries, individual inspections of properties are rare in Australia's major cities, with realtors typically putting homes on show twice a week to encourage as many people as possible to visit. These open houses, which are combined with onsite public auctions and often attract crowds of onlookers, were banned in March.

"Easing the restrictions to ensure people can more easily inspect, buy or rent a property is an important step for NSW," New South Wales Treasurer Dominic Perrottet said in a statement on Sunday.

Your feedback is important to us

Tell us what you think. Email us at btuserfeedback@sph.com.sg

The industry will still need to ensure that physical distancing and hygiene measures are maintained, Mr Perrottet said, urging the public to exercise common sense.

"If people are not genuinely in the market for a new home, now is not the time to be having a look through their neighbour's house," he said.

The relaxation of the rules comes as Australia's success in flattening the coronavirus infection curve means aspects of the economy are slowly starting to reopen ahead of schedule.

Mr Perrottet also said in an interview with the Sydney Morning Herald that stamp duty on property purchases in Sydney could be scrapped as part of a major reform of the local taxation system.

"There is no better time to rid the states of inefficient taxes that hold back economic growth and I am talking stamp duty and payroll taxes," he said. "We are not going to tax our way back into prosperity. Increasing or decreasing taxes is not tax reform."

Stamp duty, which must be paid as a lump sum on a property purchase, has been criticised by economists as providing a disincentive to move and reducing mobility in the housing market. Currently, a buyer of a typical A$1 million (S$0.9 million) home needs to pay an additional A$40,000 upfront.

Reform efforts have long been stymied by the fact the tax is also a major - if volatile - source of state revenues. In Sydney's housing boom years, stamp duty accounted for 31 per cent of the Australian state revenues. In 2019-20, that was forecast to slump to 22 per cent and is likely to fall even further given the coronavirus shutdown.

Mr Perrottet did not give any indication in the interview as to what he would like to see replace stamp duty. BLOOMBERG

BT is now on Telegram!

For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes