Property market commentary is almost always focused on the numbers although unless you are a sophisticated property investor, many of these statistical observations can be confusing to the “mum & dad” buyer trying to read the market.
When buying the family home, as long as you buy and sell simultaneously under similar market conditions, then the state of the market is almost irrelevant. In fact, upgrading your home in a slow or falling market can be beneficial. That’s because, if you assume a property market has fallen 5 per cent, your $550,000 home might only fetch $522,500, yet your new home previously worth $770,000 now sells for 5 per cent less at $731,500; a $9,000 net benefit.
Alright, this is a crude example but in recent years, it is the $1,000,000 plus price bracket that has adjusted down more than property priced around the Perth median of $515,000. That’s why the median house price has been falling up until now.
Buyers are now emerging from their holding pattern with the latest numbers showing upward pressure on median prices, sales volumes improving and supply of quality homes constrained. If you are an upgrading buyer, this market is ideal and you ought to proceed with confidence in such a low inflationary and interest rate environment. Property has always been a long term prospect and the family home purchased in 2017 for the median $515,000 ought to (if history repeats) be selling for $1,030,000 sometime over the next decade. Even if price growth is more subdued (such as it has been over the last decade in Perth) over the next ten years, most commentators agree that the bottom of the market has already passed.
It is somewhat inevitable that property prices will continue to rise over time and affordability constraints aside, those hesitating to buy when there is good choice about is counter intuitive. In a rising market when people gain confidence to buy, stock levels fall as demand increases and choice becomes so constrained that many buyers are forced to buy homes inadequate to their needs or end up competing for quality homes and paying more than they should.
If you’re upgrading through the market and have recently sold, I recommend you make a buying decision soon.
The principle behind a contract is straightforward. Two parties, having clear objectives negotiate an outcome that is reasonably suited to both parties and with consensus on terms and conditions, a verbal or written agreement is formed. Both parties know those terms and are generally satisfied that there is a fair … Read more
Here we go again. Treasurer Jim Chalmers trotted out the same line politicians always do when quizzed by journalists on something the don’t want to answer saying, ‘it’s perfectly normal for Treasury to model all manner of things in preparation of a budget.’ The Treasurer was responding to questions about … Read more