Melbourne’s CBD hit for six due to COVID-19

By Scott McElroy – Belle Property

While the impacts of COVID-19 have been well documented, particularly on the likes of the hospitality industry in the city, the impacts being felt by landlords with investment properties have also been dramatic, yet they have not received the same level of press coverage. 

The numbers are startling to say the least. At the end of January leading into the traditionally busiest month of the year for leasing being February, there were around 700 properties for lease in postcode 3000.  

The vast majority of these properties are leased by students and professionals looking for the convenience of a city lifestyle being on the doorstep of tertiary institutions and work. However, due to our borders being shut, thousands of students unable to arrive for study and work being shifted to home for the majority of businesses, the number of properties for lease in postcode 3000 as per has now ballooned to 4225. 

Of course, with tourism at zero in the city, a huge percentage of the properties up for lease have come from platforms like Airbnb. Filtering the number of properties to those furnished at 2045, is a clear indicator of this. 

Property investors in the city have been left high and dry by the government and while they may have applied for mortgage relief with their bank through the pandemic, all the other expenses of maintaining an investment property keep rolling in. The loss of income at a very conservative figure of $450 per week equates to over $1.9 million in loss rental income per week across the CBD. 

The outlook isn’t pretty when you consider we are now into late September and many properties will be vacant until early 2021. Hopefully, the balance between supply and demand is reinstated soon to what is traditionally one of the most vibrant rental markets in Melbourne.

The issue is not made any easier when as agents we have been restricted from showing tenants through properties for lease until October 26 •

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