Electronic conveyancing key to sustaining property market during COVID-19, research finds

The spotlight has been on technology more than ever as a result of COVID-19, as Australia’s key sectors have battled to maintain operational continuity.

Australia’s residential property market is the nation’s most valuable asset class, worth $7.1 trillion*, making it a vital cog in the economic resistance and future rebuild in response to the pandemic.

And a recent study has found that while major countries such as the United States and the United Kingdom reported significant declines in property settlements during COVID-19 lockdowns, Australia’s market remained fully operational.

Digitisation keeping Australians online

The Digital Transformation in the Australian Property Industry report, compiled by the University of Melbourne, confirmed it was the establishment of electronic conveyancing that enabled property exchange to proceed seamlessly, despite significant movement restrictions and lockdowns.

While many industries and the economy more broadly experienced disruption, this digitisation of Australia’s property industry has provided key resilience to the sector, ensuring that homebuyers and sellers retain access to the critical service offered by their lawyer or conveyancer.

The research noted that during May and August this year, the height of the national outbreak, more than $230 billion** worth of property settlement value was processed on Property Exchange Australia (PEXA), the country’s leading electronic conveyancing platform.

Having recently surpassed 10 years in operation, today, more than 75 per cent of all property transfer settlements in Australia are handled digitally – among the highest of any nation in the world.

There are now positive signs of a recovery too – per PEXA’s first Property and Mortgage Insights report, property settlements are presently tracking ahead of 2019 levels.***

Benefits delivered

The study also noted that taxpayers have also been winners as a result of PEXA’s growth story – with the privatisation of PEXA delivering net benefits of approximately $400 million from gains on investment to state governments.

The availability of electronic conveyancing had also contributed to the conditions for the privatisation of four land registries, with significant value generated.****

In analysing the benefits delivered to both industries and citizens, it was found that PEXA has been able to contribute substantially to the following:

• Cost and time savings at banks, financial institutions, legal firms and conveyancing companies, as well as end consumers.

• Settlements have become more secure and are now conducted in a more transparent and timely fashion.

• Buyers are now generally registered on title nearly instantly.

• Sellers receive any proceeds as cleared funds generally within an hour.

* Corelogic Monthly Chart Pack, November 2020

** Research Findings: Digital Transformation in Australian Property Industry, Dr Niharika Garud and Professor Daniel Samson, Department of Management & Marketing, Faculty of Business and Economics, The University of Melbourne

*** PEXA Property and Mortgage Insights, Year to Sept 2020

**** Research Findings: Digital Transformation in Australian Property Industry, Dr Niharika Garud and Professor Daniel Samson, Department of Management & Marketing, Faculty of Business and Economics, The University of Melbourne