One of the sins when you’re buying a property is to allow yourself to be rushed into a decision. It might seem strange, even ironic, to learn this from a real estate agent but there’s no denying its truth.
It’s a great time to buy right now with record-low interest rates and an unprecedented level of government support for the construction industry and first-time buyers.
And while the pandemic and the subsequent economic uncertainty has curtailed the number of properties for sale, it has also reduced the pool of buyers against whom you’d typically compete.
The limited supply has stabilised prices for houses and apartments, yet the sellers who’ve stayed in the market are motivated.
Even with these favourable factors, buyers should remain sensible and cautious. Always conduct the necessary building and pest inspections before you get into the weeds of price negotiation, and do not rush your decision.
As experienced real estate agents in the area, we have seen countless property deals. If you’re in the market right now, we’d love to show you some properties that might meet your criteria. In the meantime, here are some quick tips to help you make a successful purchase.
- Focus on your timeline – Be clear about your deadlines. If you’ve already sold your property and need to find your next home, you might feel time pressures. My advice in this situation is to consider taking temporary accommodation so you don’t make a panicked decision that you regret later.
- Research the local market – As a buyer, you should research the suburbs where you’d like to buy. You should note the buying trends, average time on market and the prices reached with recent sales – even if you already live in the area. This will significantly strengthen your hand when the time comes to negotiate.
- Note the supply and demand equation – Talk to agents at the open homes you attend about the state of the local market. Find out whether there are more properties than buyers, or if it’s the other way around. The supply and demand equation should determine your negotiating strategy. Don’t use media reports as a measure as these are too general. Real estate has hundreds of micro-markets, and each one has its own characteristics.
- The market determines price – No matter what a seller might think, they don’t determine the price of a property. The market does. So, don’t be afraid to negotiate using the knowledge you’ve gained from your research.
- Low-balling – If you want to put in a low-ball bid, that’s your call. But it can alienate the seller and their agent and in some cases, will even offend. A low-ball offer should not be made without research-based evidence to support it, otherwise it will be seen as disrespectful. Low ball offers are also a great way to ensure you don’t get a call back from an agent when the property receives multiple offers from other parties as the assumption is made that it is out of your price range.
- Price isn’t the only tactic – You can win your new home through a variety of negotiation strategies. Extended settlement terms are often a winner for sellers, especially if they’ve yet to find their next property. Alternatively, you might lease back the property to them so they can undertake an extended search. Or settle quickly if they’re keen to move on. Price discounts to pay for repairs cited in your building report is another way to go.