Coronavirus leaves Sydney’s prestige market sick

Sydney’s prestige housing market is expected to be one of the casualties of the coronavirus after the traditional influx of high-end shoppers from China are forced to stay home.

The short-term loss of visitors due to the federal government’s ban on non-Australian citizens travelling here from China and longer-term economic fallout from the contagion follows this summer’s disastrous bushfire season, which had already impacted on Australia’s standing as an international housing market .

The Lunar New Year is typically the busiest time of year for visitors from China, and agents on both sides of Sydney Harbour have long made the most of the annual holiday by timing the launch of their high-end listings accordingly.

“This has forced our best buyers to stay away,” said Rob Klaric, of property advisory The Property Expert.

“The other concern weighing on would-be buyers is the ripple effect of China’s manufacturing and economic slowdown on our Australian wallets,” said LJ Hooker Double Bay’s Bill Malouf.

AMP Capital chief economist Dr Shane Oliver said the travel ban was expected to translate to a cut of 0.2 per cent from GDP this quarter.

“The virus probably will affect the buying decisions of people for the next year at least, just as it will affect the tourism market for a year or so. But then it would be hoped the impact will blow over,” Dr Oliver said.

“It depends how long it lasts. SARS was over relatively quickly. It appeared in February 2003, peaked in April and then faded away. If this is like SARS and peaks in the next month or so and then fades away then it won’t have much of an impact long term. But if it lasts longer than that, then it could be severe.”

Australia’s standing as an international housing destination was already suffering from this summer’s catastrophic bushfires before the coronavirus appeared, said Ken Jacobs, of Christie’s International.

“This summer’s blanket coverage internationally of these huge fires, burnt animals and smoke hanging over Sydney changed that perception of blue skies and natural environments,” said Mr Jacobs. “The question is, how long will that perception of Australia as a wasteland last?”

Dr Oliver agrees that the bushfires will have more serious damage than the virus. “The virus impact will be felt around the world and didn’t originate here, whereas the bushfire is specific to Australia and people’s perception of Australia.”

Ray White recently closed an Adelaide agency after the World Health Organisation contacted them to say two confirmed coronavirus victims recently attended one of their auctions, prompting the office to close with staff placed in a temporary, self-imposed quarantine until Friday.

Monika Tu of BlackDiamondz said some buyers from China arrived in Sydney before the travel ban went into effect last Saturday, but two buyers who had planned to visit and inspect a $20 million house in Vaucluse and a $10 million house in Blakehurst never arrived.

The Vaucluse house, owned by Lihong Hong, is a seven-bedroom mansion with tennis court and swimming pool sold in 2017 for $15.38 million by Margaret Weiss, former wife of Ardent Leisure chairman Dr Gary Weiss.