Fear of miss­ing out drives the mar­ket

Port Douglas & Mossman Gazette - - FRONT PAGE -

RE­SEARCH from Com­mon­wealth Bank re­veals many Aussies be­lieve prop­erty prices are be­ing steered by a fear of miss­ing out on prop­erty. The re­search re­vealed the ma­jor­ity of home buy­ers (65 per cent) be­lieve prop­erty prices are be­ing steered by a fear of miss­ing out, which is caus­ing most (58 per cent) to rush in and ne­go­ti­ate a price be­fore they have done their due dili­gence.

Ac­cord­ing to the re­search, the fear of miss­ing out psy­che is also hav­ing an im­pact on buy­ers’ emo­tions with 49 per cent wor­ried that they would lose the prop­erty to an­other buyer.

Dr Ti­mothy Sharp, clin­i­cal psy­chol­o­gist, says, ‘‘Frus­tra­tion and a fear of miss­ing out are typ­i­cal re­ac­tions as­so­ci­ated with the com­plex­ity and im­por­tance of buy­ing a prop­erty. It is how­ever the big­gest fi­nan­cial de­ci­sion most of us will ever make so it’s cru­cial that the de­ci­sion is a ra­tio­nal one.’’ Prop­erty buy­ers are also mo­ti­vated by var­i­ous ex­ter­nal fac­tors when it comes to mak­ing a de­ci­sion quickly: 89 per cent of sub­se­quent home buy­ers ad­mit life events play a sig­nif­i­cant part in in­flu­enc­ing their prop­erty pur­chas­ing de­ci­sions, cit­ing ad­di­tional pres­sures such as hav­ing a new baby and the kids start­ing school, as driv­ing them to buy quickly. In all 55 per cent of in­vestors ad­mit to ne­go­ti­at­ing a price be­fore do­ing their due dili­gence and they are driven to buy more quickly be­cause they be­lieve they have found a good fi­nan­cial deal and don’t want to miss out (30 per cent). For first home buy­ers the top mo­tives for mak­ing a fast de­ci­sion are be­cause they are tired of rent­ing (22 per cent) and be­cause they be­lieve it is cheaper to buy than to rent (21 per cent).

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