As we approach the end of 2022 and look at national property market trends, it’s fair to say caution is the prevailing emotion.
The euphoria in which owners enjoyed double-digit value gains for two successive years has been tempered by rising interest rates and break-out inflation. Owners have pressed pause on plans to sell while buyers are doggedly demanding what they believe to be realistic prices.
But informed buyers and sellers are bucking this trend, knowing the best time to transact is always when it suits their circumstances.
Lower prices actually suit sellers planning to upgrade. Taking a 10% haircut on their $500,000 property is fine if you’re getting a 10% discount on a $1 million dream home. You’d be $50,000 in front.
The latest CoreLogic figures suggest plenty of buyers and sellers get this logic. Its Home Value Index for October continues to show incremental drops in value as the market adjusts to higher interest rates.
National sales data suggests values dipped 1.2%. Falls are easing in Sydney and Melbourne, influencing the -1.1% fall across all capitals in October. The only regional areas that fell in value by more than 1% were NSW (-1.7%), Victoria (-1.4%) and Queensland (-1.3%).
Since inflation forced the Reserve Bank’s hand on rate increases, capital city prices have taken an overall hit of -6.5% after rising 25.5%, says CoreLogic.
Sydney values are down -10.2% after a 27.7% rise that peaked last January. Melbourne has lost -6.4% since February after rising 17.3%.
As we enter summer, many owners will wonder if the caution is over and if the market will pick up. We recommend the following activities as you contemplate your next move:
Renew your research
Use the popular property portals to assess the volume of properties for sale in your area that are similar to your home. The fewer you find, the more likely you will achieve a good price.
Talk to an agent
Engage with agents about recent local sales, especially those of properties similar to yours. Often agents have buyers waiting for homes like yours to come on the market.
Buyer mood
Visit some open homes and get a sense of the attitude of buyers. Take note of the volume of people walking through the property. Quiz the agent, too. You’re sure to get some great ‘intel’.