Hand shake in front of house
Source: Pixabay
  • Pent up demand could be leading to "desperate" behaviours.
  • Days on market for properties dropped dramatically.
  • Rushed purchases could lead to overpaying and missed red flags.

The property market is experiencing a strong period of growth with clearance rates high, and time on market tightening up.

Real Estate Buyers Agents Association of Australia (REBAA) recently reported that buyer’s agents were seeing significantly busier January buying conditions.

Concerns were raised by REBAA president Cate Bakos, who said a rush for real estate could be unwise:

If buyers let FOMO (Fear Of Missing Out) bite too hard and buy irrationally, not only could they be paying too much for a property but they could be buying the wrong property.”

The REBAA’s president reaffirmed the position of caution and prudence in light of the increased demand, saying, “Buying safely is paramount and if the situation doesn’t allow, we firmly believe that a buyer is better off letting an opportunity go, than risking a rushed purchase if the proper due diligence can’t be done in time.”

Whether inexperienced or overwhelmed, rushing could mean buyers miss red flags.

According to the REBAA, common red flags likely to be overlooked include:

  • zoning issues,
  • restrictive covenants,
  • electrical and plumbing problems,
  • troublesome neighbours,
  • expensive special levies, and
  • obscure titles.

Going for a low demand strategy was cautioned against, Ms Bakos said: “There are also those buyers who are determined to buy a property that’s low in demand. Their strategy is to avoid competitive situations fearing that competitive conditions spell over-payment but tread carefully as this philosophy can end up costing a lot more than overpaying.”

Buying in a “hot market” might land you in hot water, so it’s no wonder due diligence and old-school patience is the order of the day.

~~

Before investing in any asset, please do your own independent research, taking into account your own personal financial situation. This article does not purport to provide financial advice. See our Terms of Use.



You May Also Like

Is Christmas FOMO leading to bad property buying decisions?

A sense of urgency could be leading to poor property buying decisions.

A growing number of buyers and renters are swiping right on digital inspections

While the option seems great for the time poor, it still misses the mark on delivering a feel for the area and scale of the home.

Sub-penthouse at Sapphire by the Gardens expected to fetch over $12M

A property in one of Australia’s iconic buildings has just been brought to the market, with price expectations in excess of $12 million

Ko & NPA partner to launch several co-owned luxury properties at Mermaid Beach, Gold Coast

Ko’s partnership with NPA Projects provides more opportunities to co-own off-the-plan holiday residences, including exclusive Gold Coast properties

Top Articles

PropertyGuru Asia Property Awards (Australia) returns for its 7th edition, including several brand new award ...

This year's awards include several brand new categories, with entries closing 2 August 2024.

Housing crisis survival guide: How to buy your first Australian property

Three property experts give the low down on how to nab a home in this tough housing market.

Strata properties as investments: All you need to know about investing in a Perth unit

As the cost of renting approaches the cost of a mortgage, more people are investing in units to escape the rental trap.