As an existing client, I wanted to give you an update on what we are seeing at the coal face of the local real estate market. With all the uncertainty that we’ve had this year, things are beginning to become clearer for the public.
We now understand the terrible impacts from the invasion of Ukraine and the pressure it’s placed on global food supplies.
We now know that Anthony Albanese and his Labor Party are in power.
We also know that interest rates have started to increase month by month, and, for the foreseeable future will continue to do so, however I’m sure that they’ll give us a break in December and January.
We’ve also seen an overall decrease in house prices, anywhere between 10% – 20%, depending on the quality of the property.
So what to do? Well, if you are:
After a bargain.
I would suggest that it is possible, however you need to act quickly when they arise, which by the way isn’t often. Most bargains are properties that are of a lower grade, main road homes, in poor condition, or poor topography or orientation, or in an undesirable location.
These properties were selling well in 2021 due to FOMO, however they are quickly uncovered in more sensible markets.
Or if you are really lucky, you get to purchase a property that’s been ‘cooked’ (See below).
Wanting to wait to see what happens.,
Please let us know so we can put your search on hold until you are ready to purchase. We understand if you are fearful as it’s a huge purchase.
The biggest question we would have is;
What signs are you waiting for that’ll give you the confidence to buy? If you can let us know as it’ll help us better understand your position.
Off Market and Pre Market opportunities.
Although we still uncover these properties everyday, the vast majority lack any sense of quality, or they are good properties but the Vendors are wanting unrealistic prices, prices that we are not prepared to recommend you pay.
So the key with these properties is to still get early access, be prepared to offer, however given enough time, the market will align a vendor to the correct price point, it’s at this stage if we are still keen to pursue, we’ll time our offer to secure the property for you.
We’re starting to see a big increase in buyers out at open homes, especially at the quality homes with correct pricing. Feedback from selling agents is that they are busier with enquiries
too. We’re just started seeing an increase in Auction clearance rates, whilst quality stock remains tight.
Taking you back to October 2021, when it was the peak of the market. It coincided with the END OF LOCKDOWN. So many buyers left the market to enjoy family, travel, lunches with friends, anything other than trying to buy a property. These buyers planned on delaying their purchase until the new year. Then as mentioned at the start of the blog, 2022 happened and here we are. November and December of 2021 felt like better buying for clients, fewer buyers were competing and that rolled over to 2022. Then as discussed, 2022 happened.
So what next?
We’re seeing some great buying, especially with properties that have been on the market for some time, or they are on their 2nd campaign. Agents call these listings ‘Burnt’ or ‘cooked’, and there’s normally nothing wrong with these homes. They’ve simply been overpriced, sat on the market for too many weeks and buyers have lost interest, believing that there’s something wrong with the property or that the Vendors want way too much money for it. Then they sell below the guide price. It’s difficult to keep up for most buyers, so we understand the confusion. But you have to be across these properties as this is where the best buying is right now.
As mentioned, most off market properties remain over priced, so we’re currently letting them hit the market as discussed. This is why our Off market purchase percentage rate has dropped this year.
Bottom line is, if the most perfect property becomes available, if it passes our Due Diligence and falls within budget, then go for it. You want to come home to a property you love, it makes a world of difference to your life, and in the long term for financial position too. If you don’t buy it, someone else will and that house won’t be back on the market (on average) for 12 years. If you love it, and you want it, the most important thing with interest rates rising is affordability. Can you afford the repayments?
We’re starting to see guide prices slowly becoming more realistic at the start of a sales campaign, and if property has good quality, then 4 to 5 buyers are actually bidding on these homes, and as we all know, there can only be one winner.
We live and work in some of the most exclusive and expensive suburbs in Australia, they have always been and will also be in high demand. So unless you are planning on flipping property, if the property is right, it’s a great time to buy.
The property market is cyclical, it always has been and now is no different. We’ll get to a plateau, we just don’t know if it’s already started or how long it’ll last before prices inevitably rise again.
We’ll never stop our searching to uncover the best available new stock for your consideration.