How will the end of Jobkeeper & Jobseeker hit the property market?

The end of COVID support packages JobKeeper and JobSeeker is unlikely to have a significant impact upon the real estate market, despite initial fears.

The pandemic was forecast to have a seismic impact upon our property market with prices predicted in some quarters to sink by 30 per cent.

In contrast, dwelling prices have grown nationally by four per cent over the last year on the back of a 9.4 per cent rise in regional areas, and 2.7 per cent in the combined capitals, according to property data analysts CoreLogic.

That price growth is expected to continue through to the end of March, when the pandemic welfare packages conclude, and beyond unabated.

“The economy is in far better shape than any original forecast at the height of COVID last year, notwithstanding such areas as tourism, combined with many industries having a complete lack of applicants for strong employment positions,” Ray Ellis, CEO of First National, Australia’s third largest real estate agency, told News Corp.

“That means that the overall impact of JobKeeper ceasing will be minimal as businesses have already streamlined their workforce in the past 12 months and many are geared for growth.

“Thus, the result on the market will provide greater certainty and most likely, produce more stock availability, which the current demand from buyers can certainly cope with.”

CoreLogic head of research Eliza Owen points out: “JobKeeper has already been reduced significantly in recent months, with no dampening impact apparent on the housing market as a whole.

“Changes to JobSeeker would likely have little direct impact on housing market values,” she said.

“With lower income households generally having lower rates of home ownership, it is more likely that households receiving JobSeeker are renters. This would imply an indirect impact on housing prices, where reduced rental return could impact an investor’s willingness to pay for a property.”

Generally speaking, workers in industries which continue to be hit hardest by the pandemic, such as hospitality and entertainment, are unlikely to be those in the market for a property.

Whereas people with more secure, permanent employment who have survived the impacts of COVID-19 thus far relatively unscathed, already have property purchase plans in motion and are unlikely to be affected by any changes to government employment support schemes.