The most important questions that need answering in real estate are: when is the best time to sell? And when is the best time to buy?
The best time to sell is when there are lots of buyers, fewer competing listings, and prices are increasing. This is the most common of markets that we experience, and it’s the reason that property values show very healthy growth over time. However, it’s not the market we’re in at the moment.
Indications are that the current market conditions are expected to continue until after the elections next year.
So when is the best time to purchase property? It’s when there are fewer buyers, an increased level of properties for sale, and prices have dropped to offer much better value.
The good news for buyers is that we’re definitely in a buyers market right now. There are a growing number of properties that are coming to market. It’s true that there are still a number of agents who consistently overprice listings to get a mandate. But sellers are realizing that, if they want to sell in this market, their only option is to react to market feedback and lower their selling expectations. And that’s exactly what we’re seeing.
So when do you make the decision to purchase then? It’s impossible to know when the market will turn and prices start moving upwards. But there are always signs when we get near to that point. The first sign is an increased number of sales. It shows that buyers are taking advantage of the better value and making the decision to purchase.
We’ve seen in the last few weeks that this is exactly what’s happening. Sales volumes are increasing. The second sign is that, as sales numbers increase, so the lower section of the market starts to see a gentle upturn in value. This is the sign that we’re just starting to see in recent weeks, especially in suburbs with lower median selling prices.
Whilst this doesn’t mean the market has yet turned, it does indicate that we’re very close to the bottom of the cycle. In other words, it’s unlikely that property values will fall much further. So, if you’re waiting for the best time to buy – it’s right now!
Not only is there some exceptional value on the market, but the banks are also hungry for your home loan. Their pricing is competitive, especially if you’re able to pay a deposit of 10-20%. All these factors combine to make it the best time to put pen to paper.
So, if you’re considering a property purchase in the next 2-4 months, I’d suggest you don’t delay much longer. If you haven’t already done so, get pre-qualified so you know exactly what finance you will obtain. Make a shortlist of the properties you want to view – and make an offer on the property that suits you best. Buying now is the smart move.
Principal of Harcourts Platinum