Buyer anticipation of an elusive cut in interest rates has applied a temporary brake on the property market as sellers entered the first month of the traditionally strong spring season.
With the rate stuck at 4.35%, buyers appear to be waiting for the Reserve Bank of Australia (RBA) to make its move to reduce mortgage costs.
With significant rate cuts applied in the United States, New Zealand, Canada, and many European countries, it feels inevitable the RBA will begin a program of 0.25% rate reductions late this year and into 2025.
The consequences for the property market of the central bank’s refusal to cut rates can be seen in the data.
Dwelling values increased 0.4% in the first month of the spring selling season.
That extends the trend in modest growth to its third month, according to the CoreLogic Home Value Index (HVI).
Values have increased only 1% in the 12 weeks to the end of September – the smallest rise for 18 months.
Sydney (+0.5%) Perth (+4.7%) and Adelaide (+4%) led the value-growth charge, but momentum has dissipated in each of these metros. The Sydney market is at its quietest since February last year.
Small declines were recorded for Melbourne, Canberra, Hobart and Darwin.
As a respected agency in your area, we believe the market will regather pace quickly. We are seeing an uptick in new listings, giving buyers a wider choice of properties.
CoreLogic says new listings have increased 3.2% compared with 12 months ago. And they are approaching 10% above the five-year average for early spring.
Patience is key for most sellers, and some may need to reassess their strategies. Here are some key observations:
Market Upside: Slow price growth and buyer reluctance provides advantages for upgraders. When you are looking for your new home, you will benefit from the current price stablisation and having fewer buyers competing against you for a property.
Price Check: Talk to your agent to reassess your price expectations. If you want to sell and move to the next chapter in your life, perhaps a little flexibility on price is required. Our agents will be happy to help guide you.
Look Good: Presentation is so important in the current market. Homes that are well-presented with no structural or cosmetic flaws will always be the fastest to move. Homes that underwhelm buyers stay on the market the longest.
Stagecraft: To set your home apart, consider hiring a professional staging company to select and rent furniture that highlights the best features of your home. It’s amazing how staging can transform a property and capture the imagination of buyers.
Reassess Marketing: Talk to your agent about how to target more potential buyers. Is your photography cutting through on the big portals? What more can you do? Only by asking the right questions will you find the answers to sell your home quickly and maximise its value.