Select Property Advocate Managing Director, Carly Susic, says the market is going through a much needed correction and rather than face this period with fear, prospective homebuyers should act to take advantage of the opportunities the downturn offers.
Open any of the major Australian newspapers on any day during the past six months, and you’ll read all kinds of fear mongering about the current economic and property market.
While there is no doubt the market is currently going through a correction, it’s not the end of the world. Scott Pape, one of Australia’s most respected financial advisors recently likened the share market to a rollercoaster ride: breathtaking climbs, gentle dips and at least a couple of stomach-churning plunges along the way.
My view is that the property market is similar. There will be peaks and troughs and that’s completely normal. The most important thing is not to freak out and make panicked decisions.
MAXIMISE DURING A COOL MARKET
If you’re placed well financially, now is actually an opportune time to buy so do your research, engage a professional for advice and take advantage of the current market.
First Home Buyers
The market has slowed and this means it’s nowhere near as competitive as it was to purchase your first home. Last year it was very hard for first homebuyers, with more established investors and purchasers snapping up properties and driving auction bids well above advertised price ranges. Now, that’s not always the case.
You’re in a great place because you are now likely to be able to buy something you may not have previously been able to due to slowing house prices, and there’s still stamp duty savings to be had for purchases up to $750K. Buy the home you want, can afford and hold onto while the market goes through this correction.
It can be easy to sit back and think that if you wait until next year the market will get even better. Our suggestion? Don’t. If you find a home you love, that is in your price range and budget and you want to buy, then go for it. Engage the help of a property advocate to ensure you get the best deal possible.
Selling? Be realistic
There’s no doubt about it – homes are not selling at the same pace or price as they were twelve months ago. But just because that’s the case, doesn’t mean if you want to sell that you shouldn’t.
If you are putting your home on the market because you need to sell, take the time to make sure you get your strategy right. People think they need a property advocate when the market is hot. Yes, during a heated market an advocate can assist you to get the price possible, but you actually need an advocate even more when the market is cooling.
It’s important to be realistic and realise it’s going to take a little bit longer to sell your home, than it might have in recent years, but that doesn’t mean you won’t get a good result.
If you’re buying and selling in the same market, it may only have a neutral effect on your overall position. You might sell your current home for slightly less, however a property that wasn’t necessarily in reach for you to buy last year, now may be.
If you do not need to sell, hold onto your property for now and re-evaluate your long term objectives. Seek professional advice from a property advocate to look at the best strategy for the timing and strategy for the sale of your home.
If you’re looking to buy and are wanting to maximise the current low home prices remember the same rules apply as they do in a buoyant market: if the offer sounds too good to be true, it probably is.
Regardless of your current position, whether buying or selling, it’s important to note this market correction is just that – a correction. In Australia the property market really felt minimal impacts from the Global Financial Crisis (GFC) and the tightening we’re seeing in the current market is one that was overdue.
Yes interest rates may fluctuate slightly over the years like they always have – and they will continue to do that. Regardless, the property market continues to be a sound investment. When you own a home, it’s still standing, it’s still real – and it’s still a bricks and mortar investment. It’s not like an investment in shares which very well could be lost overnight.
When you play the property market you’re playing the long game. Continue to view property as a long term asset and financial investment and ensure you buy the right property and you will rarely lose.
Need advice? Have a chat with a member of our team to find out how we can support you during the current market.