How to get the best out of the market
Get the insights into our local property market with real estate expert Wayne Maguire.
Aswe restart in 2022, a market lies ahead that could literally do anything. During the final days of last year, the bidding and buying frenzy cooled off, but will the market now plateau, or will it tighten more with lending restraints kicking in? Alternatively, will it bow to longterm fundamentals as Auckland normally does, and rally again?
I suggest tomy clients and my team that second-guessing the market is time wasted. Correctly identifying the current operating market is a better use of energy.
Many industry operators think of two markets – a buyer’s market and a seller’s market. In a buyer’s market, there are more listings than buying demand will meet therefore the seller (vendor) needs to compete with other sellers to gain buyers interest. In a seller’s market, buying demand outstrips the volume of property for sale and sees buyers compete for and paymore to beat the competition.
With the right strategy and implementation, you can do well in all three real estate markets. The third market is what I call a transitional, or balanced market. As the name suggests, this happens in the movement between markets.
As we move from a buyer’s to a seller’s market, supply and demand achieves an equilibrium where buyers and sellers see properties sitting at similar values and volumes of homes better match buying demand. During this transition, demand and the perception of values are in balance between seller and buyer. But it doesn’t last.
Conversely, when we go from a seller’s market (buying frenzy, high prices) to a buyer’s market (fewer buyers and houses not selling so quickly), there is again a short period of balance followed by an uncomfortable period where sellers realise they missed the last market and prices have cooled.
As I’ve already said, whether buying or selling, with the right strategy you can win in any of the three markets. You need good advice, clear logic, and strategy to see the upside each time.
Rather than second-guessing the market, I’d suggest starting now in January, you can be better focused on being prepared for whatever manifests in real estate.
If you’re selling then, it’s really easy. Prepare and groom every aspect of your home so that it shines when a buyer views it.
First impressions count, so work on street appeal and landscaping. This can be as simple as clearing out all weeds and water blasting, or it might extend to painting a fence or property feature in a more modern colour.
Inside, repair all those little niggly things and upgrade lighting so everything is bright and welcoming.
And go deeper. Most buyers will (and should) do a building inspection either before bidding on a property or as a condition of a private treaty contract – so it makes sense that you do one first.
This ensures all is as it should be, to rectify and repair anything that needs it. It also gives you more certainty that halfway through your campaign you won’t be surprised with any issues that sabotage a buyer’s interest and may then require disclosure to all subsequent buyers.
So if you’re selling, get a builder and some maintenance guys in.
If you’re a buyer, my advice is succinct: don’t worry about second-guessing the market. Invest your time in developing a relationship with amortgage adviser you can trust.
We all know the challenges of finding a bank branch that is open and available where you can talk face to facewith someone. Even if you can, they will only be focused on selling you their brand, their mortgage products.
Therefore I strongly suggest you contact an independent broker who deals across multiple banks and lenders. Find one you trust, develop aworking relationship and show them your loyalty.
My personal broker is one I trust 100 per cent – a sounding board I rely on for year-round advice.
Whether buying or selling this year, be proactive and invest your energy in the area you have control over and this will be your winning year.
Wayne Maguire is the CEO of Maguire& Associates, which owns several Ray White branches across East Auckland, and he is an award-winning auctioneer. Maguire calls about 400 auctions each year, negotiating and closing about $20m in sales every week. He is Ray White Auctioneer of the Year and dad to five girls.