When the price is right, houses will still sell fast
Deb had concerns about putting her home on the market – but it sold swiftly, for more than she expected. Kylie Klein-Nixon reports.
Wellington vendor Deb was ‘‘really worried’’ about putting her quirky 1980s-built home on the market.
‘‘Interest rates were up, the media was saying everything was dropping, and the banks were getting much harder to deal with. The market had turned, and got really yucky,’’ she says.
She’d spent the summer getting the house ready for sale. With an RV of $1.32 million, she sought buyer inquiries over $1.13m.
But the two offers she got came quickly, exceeded her expectations, and she sold for $1.3m.
Our housing market is rapidly slowing down – this year it saw the biggest drop in prices since 2012.
In some parts of the country it now takes twice as long to sell your house as it did a year ago. The average property listed on TradeMe was advertised for 51 days in April, up 56% year-onyear. Great news if you’re a firsttime buyer, but tough if you’re trying to sell.
But people are still selling homes. Some, like Deb, are managing to do it quickly, and achieve prices they are happy with. Is there any secret behind their sales?
For Deb, whose surname Stuff agreed not to use, the key was remaining realistic.
‘‘I knew there were some things about [the house] that not everyone would love. I loved it, but the market would tell me what people really thought about it,’’ she says.
She worked hard to find the right agent, interviewing three ‘‘just to see who I thought would do the best job for me. I guess I was an informed seller. I think it helps if you take an active role in [the selling process].’’
choice. They both came with conditions, but I understand that’s how it is right now. The distance between the offers was about 10% So it wasn’t especially close, and I was just happy to take the biggest one.
‘‘A couple of months ago, an emotional buyer would have paid another 10% or 20% on top of what I got. But that’s a long time ago. It’s magic money in some ways. It’s not real money. You definitely need to forget about that.’’
Developer Anjay Lakhan has been in property for about 16 years and knows the market well – he owns about 17 rental properties throughout the country.
He was already having trouble selling a property he owned in Hamilton, so when he listed a house he owned in Otangarei, Whangā rei, with agent Richard Lyon from Eves Real Estate, his expectations were not high.
But to his surprise, he had an offer within two hours, and sold two weeks later for $460,000, about $40,000 more than
Lahkan had initially expected.
‘‘I think that the reason the property has sold so quickly was because it was in the bottom price range for the area,’’ says Lakhan. ‘‘You can’t get much under $500,000 in Whangā rei.’’
He was lucky to be selling the right property for the demand in that area – the market behaves differently depending on the region, he says.
‘‘In Christchurch, the prices haven’t gone down, it is stable. In Hamilton, the market has actually come down, so the appraisal [for my property there] was for $800,000, and we have brought the price down to $699,000. Still people don’t want to buy, the property is still on the market.
‘‘Compare that to Whangā rei, where the property sold within a few days really.’’
Making sure your house is in tip-top shape can’t hurt in terms of helping achieve a sale. ‘‘Curb appeal’’ and having good pictures on the listing is crucial for getting potential buyers through the door, he says.
But fundamentally, there’s no complicated secret – the price just has to be right for right now.
‘‘You’re not marketing your home on its own, you’re marketing your home relative to everything else on the market,’’ says Lowe and Co director Craig Lowe.
‘‘If it’s priced at the right point, then even in this market it will sell swiftly, but it still has to be handled professionally with good promotion and good presentation.’’
Sellers may still have the million dollar-plus sales of 2021 fresh in their minds, says Lowe, which means dropping prices to match the current market is hard.
He calls that suffering from ‘‘loss aversion’’, a ‘‘powerful psychological driver’’, but not one you should be setting your sale price expectations by.
‘‘Say there’s a boom that’s five years long. You’re happy in year one when it goes up, and in year two, three, four, and five when it goes up. Why are you then suddenly disappointed when it goes back to year four’s prices?
‘‘People rightly want to maximise their investment, but at the end of the day, you don’t really want 30% property price gains every year, it’s not good for society.’’