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Buyers and sellers caught short by the lockdown extension in greater Melbourne

Property buyers and sellers face potentially severe financial losses if they can't complete transactions, industry advocates say.

Under Victoria's extended lockdown, public auctions with limited numbers and home inspections by appointment will not be permitted before October 26 at the earliest.

Real Estate Institute of Victoria president Leah Calnan said the move would compound the financial stress on Victorians and the Victorian economy and do nothing to help those suffering during these difficult times.

"We have cases being reported every day where people need to sell their property to get through these financially challenging times, and they can’t do so because the government won’t allow even a one-on-one inspection," Ms Calnan said.

Dimitris and Catherine Loupos were among those who needed to sell or risk losing their life savings but are now less likely to find a buyer due to the extended ban on home inspections.

"When I heard the news on Sunday, I just wanted to throw my remote at the TV screen – I was in utter shock with the road map," Mr Loupos said.

"I could have coped with the two-week extension, but to not allow home inspections and until October 26, it will destroy our dreams. It literally makes me feel sick thinking about losing $80,000 that we've spent years saving, and the real possibility that we could lose this property as well."

Mr Loupos said they had already bought their next home and paid the deposit, which they risked losing if their existing home was not sold by the time they settled on their new purchase.

"The only way we could get approval for our mortgage to buy the property was to sign on for a loan where the existing house would settle on the same day as the property we have purchased, but that's not looking likely," he said.

"The most frustrating thing is we’ve had excellent feedback on our property just from the pictures. I’m convinced we would be able to sell our house if people were able to come through to inspect – but with things as they are, we’re staring into an $80,000 hole."

It is not just vendors who are feeling the pain of the extended lockdown. Buyers such as Bridget Parris, who has already signed the contract to buy, would not be able to inspect the property before it becomes unconditional. Her only option is to forfeit the deposit or buy sight unseen.

"It's not ideal but if we have to buy sight unseen, we would," Ms Parris said.

The Managing Director of Ray White Group said: "It makes absolutely no sense to forbid private inspections when you compare the safe environment we can create compared to the activities that are being allowed.

"We note that physical on-site meetings will be permitted from September 13 in the construction industry and display homes will be open by appointment only from September 28.

"We see no difference between these settings, particularly for many properties that are vacant, and believe the same settings can be achieved in the real estate industry.

"Based on the people we have spoken to today, there would be thousands of Victorians in distress as a result of the recent announcements."

Source: Financial Review