One of the unintended consequences of the Melbourne lockdowns will be that tens of thousands of people will flee the city. That’s according to Propertyology, who are forecasting “one of the biggest swings in internal migration by any Australian city ever”.
Propertyology is predicting “a major transference of housing demand” driven by diminished employment opportunities, and a fear of future lockdowns. None of this spells good news for the city.
“Whether they relocate to a nearby Victorian regional location such as Bendigo, Wodonga, the Great Ocean Road region or whether they completely leave the state, thousands of Melburnians will take action to regain their freedom,” Propertyology’s Head of Research, Simon Pressley said.
“Prolonged uncertainty for one’s income is unsustainable. Lockdown is no lifestyle.”
Size is also a factor in how vulnerable Melbourne’s population is to disasters such as COVID-19.
“They are the most vulnerable to the loss of international tourists and international students, they are reliant on overseas migration, they have the highest mortgages to service, and the greatest risk of disruptions because they have the highest population density,” Mr Pressley said.
“For as long as this germ is on planet earth, the property markets of Australia’s two biggest cities will always be the most vulnerable to COVID-19.”
After Premier Daniel Andrews this week extended the lockdown to (at least) October 26, the forecast was again adjusted.
“Very low real estate resale volumes, near zero interest rates and federal government income support packages provide a solid floor for property markets nationally. But Melbourne is now an exception to this rule,” Mr Pressley said.
“It’s very sad. It’s Propertyology’s view that the Victorian State Government’s handling of the hotel quarantine situation and the subsequent decision to enforce a 112-day city lockdown will cripple Melbourne’s economy for several years.
“While Melbourne’s property market held firm during the six-week lockdown in March-April, we fear that the impact of (this recent lockdown) decision will be a bridge too far for many businesses.”
Mr Pressley “would not be surprised” if as many as 30,000 people left the city over the next two financial years.
“A hard lockdown of more than 100-days will be the cause of the biggest shock to Melbourne’s economy that most of its residents have ever seen,” he said.
“It is highly possible that it could lose as many as 30,000 people over the next couple of years. Sydney lost 25,000 last year alone.”