REA Insights Commercial Property Snapshot, May 2021
After a record-breaking March, demand for commercial property eased slightly in April. Despite the dip in activity, April marked the second-highest month on record for ‘Buy’ searches on realcommercial.com.au.
In this month’s commercial snapshot, we continue to track search volumes over time and demand by category. We also provide a view of user behaviour by analysing the most-searched keywords per asset class as well as looking at the most popular commercial property listings for the month.
How are search volumes tracking?
As COVID-19 affected the property market in both March and April 2020, we continue to observe large year-on-year growth figures. ‘Buy’ searches are up 61% year-on-year, while and ‘Lease’ searches have surged 65%.
‘Buy’ search volumes were the second highest they have ever been across all states bar the Australian Capital Territory, where searches increased 7% month-on-month to a new record high.
National ‘lease’ search volumes were 12% lower than the peak seen in March. ‘Lease’ searches in the Australia Capital Territory recorded the smallest drop among the states, just 3% below its peak the month prior.
The year-on-year jump is visible across all categories.
Given it’s resilience during COVID-19 lockdowns, the year-on-year change in searches for commercial farming was the lowest of the asset classes, up 26%.
Conversely, searches for medical/consulting and office listings were impacted the most last year but have positively bounced back, recording high year-on-year increases of 171% and 155% respectively.
In particular, search volume for office spaces continue to rise as commercial property seekers look for non-CBD office spaces.
What are people and businesses looking to buy?
Compared to the other categories that have recorded high year-on-year growth of more than double, the hotel/leisure sector appears to not have fully recovered from the impacts of the pandemic, recording a relatively modest year-on-year increase of 61%.
This is likely due to the significant deceleration of travel and entertainment and uncertainty around the length of time it will take these sectors to recover.
In April, showrooms was the only category that recorded a positive month-on-month change (3%). This was prominently attributed to the 41% increase in New South Wales, which saw the highest month-on-month growth across all states and categories.
The chart below shows the month-on-month percentage change of views per listing, rather than the typical year-on-year figures usually presented in this report. The year-on-year trend is abnormally high given demand the impacts of the lockdowns 12 months ago.
What are people and businesses looking to lease?
All lease categories recorded a month-on-month drop in views per listing, the largest of these being commercial farming (-11%), offices (-11%) and warehouses (-10%).
For offices, the decrease can be attributed to New South Wales (-14%) and Western Australia (-15%), which saw the largest declines.
The national decrease recorded for warehouses was driven by all states bar Tasmania, which saw a 3% month-on-month increase.
What are the features that people and businesses are looking for?
In April’s analysis of the top searched keywords, ‘freehold’ appeared in all categories except industrial/warehouses, suggesting a growing desire to have complete control over a commercial property. The keyword made its first appearance in the retail sector this month.
Additionally, the showroom/bulky goods category seems to be almost synonymous with the industrial/warehouse category, as ‘warehouse’ became the top-searched keyword for the former type of listings this month.
What have been the most popular commercial listings?
See the top 10 most viewed commercial listings nationally and in each state below.
The most-viewed commercial listing in April that is still on the market was a fully tenanted neo-gothic office building inclusive of a private penthouse with views of Hobart, Mount Wellington and Derwent River.