Confused by the economic gurus? Wondering how one minute the property market is supposed to be crashing around our ears, and the next it’s double-digit growth for 2021?
Yes? We all are!
Successful buying and selling of property requires a focus in which you are confident of your plan for your future. Allowing your vision to be pushed, pulled and twisted by the predictions of economists and media headlines creates unnecessary stress that deflects you from achieving your goals.
Over any seven to 10-year period, the property market has always displayed resilience and growth regardless of the prevailing short term economy.
Of course, there have been moments of ups and downs, but overall property remains one of the best and most secure investments you’ll ever make.
So, it’s important to appreciate that any angst you might hold over whether you should sell this week, or buy next month, is a wasted emotion. In five years, you’ll not remember what worried you.
As experienced agents, we’ve witnessed how the property market waxes and wanes and we always work with our clients to build a strategy for those moments.
Below are some points about market behaviour that might inform your current thinking.
- Australian property is made up of thousands of micro-markets, each of which can perform at different levels. Dismiss talk of city-wide increases as media noise. It’s what’s happening in our suburb that counts.
- If you find a property you love, then make a fair-price bid for it. Low-balling the seller because you think the market is ‘down’ rarely works and you risk losing the home you want.
- First-time buyers should capitalise on stamp duty discounts, the federal government’s savings scheme and state-based grants, which can be as much as $20,000 in regional areas.
- Homeowners should weigh up the benefit between selling at slightly less than they anticipated against buying their next property at a lower price. If you’re upgrading, you’re going to finish ahead. So, don’t fixate on the current value of your home but the entirety of your sell-buy transaction.
- The property market mostly fluctuates on the principle of supply and demand. If you’re wondering why we haven’t seen prices crash, it’s because the withdrawal of properties from the market when Covid hit helped stabilise prices.
- There are some short-term Covid-related disturbances, which is why it’s an excellent time to transact. With changes to Job Keeper flowing through and deferred loans starting to time out, we may see more property come onto the market as stressed sales. But it does not necessarily mean dramatically weaker prices because of buyer competition. Also, the soft rental market may encourage some landlords to sell, especially those in the inner-cities. You should watch for these as opportunities but not make them the focus of your property ownership strategy.
- There’s good buying even with pent-up demand on both the buy and sell sides of the market. You can expect these conditions to continue beyond January and until the market stabilises.
- Don’t try to time the market. There are countless research papers on the folly of trying to sell high and buy low, and it can all go wrong for you. Create a property ownership and wealth strategy that works for you and execute it.
- No one can be sure of market movements so, at some stage, you’re going to take a leap of faith – or no leap at all.