Timing – when is a good time to buy?
There are numerous elements that can affect your buying process, which in turn could result in an increase in profit and offer you more value for money later down the line.
Understanding the property market
The easiest way to get an understanding of the property market is to take a look at the property cycle, or clock. The different stages of the cycle can be seen below:
Discover your dream home, and make a profit while doing so…
When you buy, and which element of the cycle you choose to sell can have a large impact on your finances, turning your home into a financial investment. Numerous elements can have an affect on the buyers cycle, such as:
- Interest rates – changes within the banking sector
- Competition – whether a property or suburb is sought after, supply and demand
- Specific Suburbs – if the area you have chosen is trending, or going under development
- The economy – whether there has been a boost in jobs or an event being held
Don’t fear the market
It is not often luck – it’s about being aware of all the variables that affect the market and knowing how to spot a dip or peak before it hits.
Confidence, and whether to jump into a falling market
Although the bottom of the market is ideally the best time to buy, if you’re not completely confidant, choose your property as the market begins to rise. It’s a great time for discounts, plus it also means you can access your profit without having to wait a long time for the market to change.
The market relies on capital growth change in the area, and the results of specific suburbs are a good indicator as to whether the market is moving in the right direction, so keep checking back if you are thinking of putting in an offer.
Are we on the road to recovery?
A rising market or start of recovery is easy to read, and if it has already started, it is likely to continue. Once it begins, other suburbs will usually start to follow the trend, and peoples hope and positive attitude drives the rest of sales…
Get ahead of the game
Is there a lot of investment talk going on around you? Then keep an eye on the value of properties – as the market rises, so will the property valuations. If local sales start to diminish and more overseas buyers become recognised, you should begin preparing for a rise.
Know the signs:
- Look out for overseas investors – these tend to be experienced and recognise the market
- High auction clearance rates, in excess of 50%
- Local investors returning after a break of interest
Feeling hot, hot, hot
If you can, avoid the market while it’s hot. Prices will increase at a fast rate, however it is the ideal time to sell! The demand for your property will be high, and you can use this to your advantage. This tends to be the only time where buyers will negotiate above the asking price, so bear that in mind.
Know the signs:
- There is a buzz in the area, with lots of excitement surrounding specific suburbs
- Houses don’t stay on the market long – you’ll notice different listings daily
- Vendors don’t have the need to drop their asking price, and can even sell for higher than.
Pay attention to all the variables
Both small and large events can have an affect on the housing market, and it can change dramatically. For example, anything from the olympics being held in a certain city, to a school expanding their catchment area. So keep up to date with local news and future government plans, so nothing comes as a surprise.
Australia vs the world
Although the market cycles change in a certain patter, they vary drastically from state to state. The West Australian market is does not run in line with the likes of Sydney or Melbourne, although we tend to view Australia as a whole when it comes to success.