A report from Toronto Life in Canada. “When the pandemic hit, Christine Morra was forced to shut down her Blue Mountain Airbnb rental. We spoke to her about adjusting to the new normal. ‘In 2017, we bought a two-bedroom condo near our place in Blue Mountain. We paid in the mid-$400,000s and planned to rent it out on Airbnb to help cover our mortgage and renovation costs. Before Covid, we were earning around $10,000 or $11,000 per month from Airbnb during the busy seasons—December through February and July through August. The rest of the year, we earned around $5,000 to $6,000 per month.’”
“‘In mid-March, when the province announced schools were closing, we started seeing cancellation after cancellation after cancellation—at least 20 cancelled stays. On the Airbnb site, you can track your future income: for the month of March, we watched our projected earnings go from $7,000 to $1,000 in a matter of hours. It was devastating. Right now we’re dipping into our savings from our Airbnb income to pay our mortgage. We are stressed and worried, but hopeful.’”
From Global News in Canada. “Across Canada, rents are falling amid the novel coronavirus pandemic. The declines are widespread across cities and regions, with average April rents now significantly below year-ago levels in some of the country’s priciest markets. In Toronto and Vancouver, for example, average rents were down by five per cent and nine per cent respectively last month compared to the same period in 2019.”
“On the other hand, the supply of available rental units is rising. With short-term rentals sitting empty, many landlords are now looking to fill their units with longer-term rentals, Paul Danison of Rentals.ca says, adding that his company has seen an ‘uptick’ in such listings. The rent declines have been particularly steep in the oil-rich provinces, where local economies have been struggling with low energy prices in addition to the pandemic. Average rents in Calgary, Edmonton and Regina have seen double-digit annual declines, while in Saskatoon they’re down by a staggering 28 per cent.”
The Times of London in the UK. “In February, after agreeing to the asking price of £445,000, Anne O’Callaghan exchanged contracts on the purchase of a four-bedroom new-build house in West Sussex that she is buying with her sister. Anne, a 60-year-old retired teacher, did not need to pay a deposit when she exchanged because she had decided to part-exchange the cottage she owned and pay the remaining £200,000 of the new property’s price on top.”
“The developer set the completion date for June 30, but, because of interruptions to construction caused by the coronavirus crisis, it has been postponed to October 30. Anne is concerned that she is no longer getting a good deal for the property given the drop in house prices that is beginning to register because of the pandemic, and wonders whether there are any legal avenues she can explore. She has seen that the developer is offering a three-bedroom detached home in the same development for £369,000 — £30,000 less than what was being asked before the outbreak.”
“‘We don’t want to end up buying a pig in a poke,’ Anne said. ‘We have noticed price reductions on certain plots on the same site, albeit on a different style of house, and we suspect that this might become a trend on the development as a whole. Given that we have already exchanged, do we have the legal option to try to negotiate a price reduction, or will we face a big penalty for doing so? We do not want to end up with a white elephant that has a much lower resale price in the next few years. I’m sure there are many others who have been affected in the same way.’”
The Bangkok Post in Thailand. “Bangkok’s condominium market at the start of 2020 was entering a period of severe change, driven by a fall in buyer demand and by the large amount of unsold inventory that had become a risk for developers. Covid-19 has exacerbated these trends. In efforts to reduce their unsold inventory and to alleviate the potentially ruinous effects of a global recession, some developers have been offering extreme discounts on completed units to try and motivate buyers.”
“The discounts and promotions on offer include covering the first 12-36 months of mortgage payments, common fee exemptions and purchase price discounts of up to 50% in some extreme cases.”
The Australian Associated Press. “Some Sydney hotels are listing their rooms on rental websites, adding to a surge in the number of city landlords desperate to find a tenant. The Sydney CBD rental vacancy rate – the percentage of homes available for lease that are empty – rose from 5.7 per cent in March to 13.8 per cent in April, SQM Research indicates. The figures coincide with COVID-19 travel restrictions sapping demand for accommodation by foreign students, and a dearth of interstate and international visitors which prompted many Airbnb property owners to seek long-term occupants.”
“Frasers Property Australia has announced it is making its CBD hotel rooms available under lease terms of between three and 12 months in what it calls a ‘fresh new option to the residential rental market.’ Fraser Suites Sydney rooms start at $600 per week, with residents willing to sign a lease of at least three months given one week rent-free. Outside of NSW, Arise Hotels and Resorts also said it has adapted its approach with the 15 properties it runs across Melbourne, Brisbane and the Gold Coast.”
The Property Observer in Australia. “A Melbourne residential unit has come onto the market priced at $5,000 less than it was sold for more than a decade. Located at 3206/31 A’Beckett Street, the apartment features two bedrooms, one bathroom, a combined kitchen and living area, and a car space. It last sold in 2008, for $443,500. It has been listed in 2020 for $438,000.”
“The sale reflects a growing concern about the stability of Melbourne’s housing market in the current economic climate, with HSBC estimating prices could drop by as much as 17% if the current downturn is prolonged. Another unit, on the same street, has also been recently listed with a price guide reflecting a likely loss on the investment.”