- It's a buyer's market, property expert Lloyd Edge said.
- The biggest peak to trough slide in house prices recorded at 8.4%.
- Most Aussies think 2023 is a bad time to buy, according to Aus Property Professionals' survey.
Weathering the interest rate storm feels like a lot of suffering, but there is a silver lining for those looking mournfully at the alluring buyer’s market that seems just out of reach.
Leading property expert Lloyd Edge has four tips to make the most of the buyer’s market and get started with your property dreams.
What is a buyer’s market?
Put in simple terms, a buyer’s market is when the buyer has the negotiating edge over the seller or vendor.
In practical terms, buyers may have the luxury of choice. There may be an oversupply of housing stock which will favour the buyer. That of course is not the current situation.
Other reasons which factor into a buyer’s market include falls in house prices and house values, again this can be driven by several factors, in recent times that reason is the soaring interest rates.
Further, buyers may have time on their side as sellers need to sell for some reason or other. This can include foreclosure, financial stress, and more.
Why is it a buyer’s market?
The Australian housing market has experienced a landslide in values, with the greatest-ever peak-to-trough fall recorded in May last year.
Home values in Australia collapsed 8.4 per cent since May last year, with the main driver of falling home values being the eight consecutive interest rate rises across 2022, rising by 300 basis points in only eight months.
What do Aussies think?
New research commissioned by Aus Property Professionals revealed what Australians really think about the current property market. Unsurprisingly, almost 7 out of 10 Australians (65 per cent of the general population) believe that 2023 is the wrong time to enter the property market, agreeing with the statement “Because of rising interest rates and falling house prices, people should be cautious about entering the property market for the time being.”
On the other hand, the research also revealed that 35 per cent of Australians believed that 2023 is the right time to buy a house, saying that “Yes, it’s a buyer’s market and there is plenty of opportunity for people who are organised with their finances.”
Lloyd Edge, best-selling author of Positively Geared and Buy Now, said “The Australian property market in 2023 is certainly facing some challenges with consecutive interest rate rises making it a tougher environment for buyers. However, for savvy investors, this presents a great opportunity to make smart, strategic purchases. The key is to do your research and be prepared to act quickly on promising opportunities.”
Mr Edge added, “We’re definitely in a buyer’s market right now, with an abundance of great deals available and less competition. This means that buyers have more options to choose from, and have more room to negotiate on price. It’s a great time to enter the market for those who have been waiting on the sidelines for the right opportunity. At Aus Property Professionals, we’ve had a 65% increase in enquiries from hopeful buyers compared to January last year.”
Four tips for getting on the property ladder in 2023
- Look for motivated sellers,
- Negotiate – look for overpriced properties or houses needing some TLC,
- Get networking with real estate agents, investors, and other professionals in the industry, and
- Be persistent.
Look for motivated sellers
Motivated sellers mean those selling properties due to financial difficulties or other urgent circumstances and are willing to sell for less than market value. Mr Edge also said keep an eye out for foreclosures and short sales. These are properties that are being sold by banks or other lending institutions and can often be purchased for less than market value.
Look for negotiating opportunities
Properties that have been on the market for a long time are prime examples – Mr Edge said these homes may be overpriced, with sellers potentially more willing to negotiate a lower price.
Mr Edge also included properties that needed repairs or renovations. These types of properties can often be purchased for less than market value, as the cost of repairs can be a deterrent for many buyers. For savvy investors, it’s also a great opportunity to add value to the property and manufacture equity through renovations.
Network
Network with real estate agents, investors, and other professionals in the industry. They may have access to properties that are not yet on the market or have inside information about upcoming sales. A buyer’s agent can also help you with their expert negotiation skills and relationship with real estate agents.
Be persistent
The market can be dynamic and change quickly, so it’s important to keep searching and keep an eye out for new opportunities. Do your research and due diligence to ensure you find the right property that fits your needs and budget.
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