It’s time to grab a prop­erty bar­gain

The Advertiser - Real Estate - - House Hunter - AN­THONY K16E2ANE

HAVE you thought that these real es­tate pages have been feel­ing a bit heav­ier over the past few months? Your keen sense of touch does not fail you. In fact, open in­spec­tion listings in re­cent weeks have been up to 40 per cent higher than for the same time last year. This il­lus­trates one of two pos­si­bil­i­ties. First, the real es­tate mar­ket is boom­ing and fresh sell­ers are com­ing out of the wood­work be­cause they’re buoyed by the high prices be­ing paid.

Sec­ond, it’s a true buy­ers’ mar­ket be­cause there is a glut of prop­erty up for sale, mean­ing in­vestors and po­ten­tial home­buy­ers are bet­ter placed to grab a bar­gain. My money’s on the sec­ond the­ory. The scales of sup­ply and de­mand look to be tipped firmly on the sup­ply side at the mo­ment and we are cer­tainly not see­ing boom con­di­tions.

RP Data re­cently re­ported that Ade­laide’s me­dian house price rose just 0.4 per cent to $410,000 in the 12 months to Fe­bru­ary.

Unit prices were a bit bet­ter, in­creas­ing by 1.3 per cent to $328,500.

Both were be­low the rate of in­fla­tion, which means in real terms the prices are go­ing back­wards, al­though only slightly.

The gen­eral feel­ing among agents and builders seems to be that the mar­ket is patchy. Some prop­er­ties are still sell­ing quickly while oth­ers are hang­ing around for months – much to the frus­tra­tion of their own­ers.

The old line ‘‘if you’re re­al­is­tic about your ask­ing price, it will sell’’ is be­ing wheeled out reg­u­larly.

Un­cer­tainty over in­ter­est rates is hurt­ing the mar­ket. While the Re­serve Bank left rates on hold again early this month, most econ­o­mists say the next move will be higher and will prob­a­bly come be­fore the end of the year.

Add to this the tougher lend­ing con­di­tions im­posed by banks since the global fi­nan­cial cri­sis and prop­erty fi­nance doesn’t have a lot go­ing for it.

So what do you do? It all de­pends on your po­si­tion.

A seller needs pa­tience and must un­der­stand that it may take a few months to get re­sults.

This pa­tience will be sorely tested if you’ve al­ready bought an­other prop­erty and are look­ing at un­pleas­ant bridg­ing fi­nance sce­nar­ios and len­ders mort­gage in­surance.

Some­times you just have to take some fi­nan­cial pain and ac­cept an of­fer be­low what you were hop­ing for. I’ve seen peo­ple turn down of­fers that were a few thou­sand be­low their ex­pec­ta­tions and end up hold­ing an un­wanted prop­erly for six months or more, spend­ing thou­sands of dol­lars in un­nec­es­sary loan in­ter­est and ad­ver­tis­ing costs.

Buy­ers are in a good place, with plenty of op­tions avail­able and some sell­ers get­ting more dis­tressed as the days go by.

It’s the same for in­vestors look­ing to buy while in­vestors look­ing to sell need to be pa­tient and con­tinue to see their prop­er­ties as a long-term as­set.

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