BY SCOTT AUER, PRINCIPAL, RAY WHITE TINGALPA
According to a recent article by real estate industry veteran and Australasia’s number one real estate coach and trainer Tom Panos, “Property prices have already dropped. They may soften further but there are no signs there will be distress selling”.
He goes on to explain the problem with data is that it lags by up to three to four months, meaning by the time the data is collected and analysed, the market has moved again. Or put another way, markets move faster than economists, and most real estate commentary comes from economists using lagged data.
Panos bases his views on the week-to-week information he collects directly from agents, as the agents are the first to see the change in buyer behaviour. Open homes with 50 to 100 buyer groups are a thing for the history books, being replaced with a high degree of nervousness from buyers placing conservative offers below the price guide.
Take the median property price for Brisbane from June to July which reportedly dropped by only 0.1%. A comforting statistic maybe, however what it doesn’t show is the massive increase in the Days On Market, with many properties still on the market at 60 or 90 days. Vendors are being challenged to accept less than they would have achieved in the previous market. Buyers are factoring in further interest rate rises, and the prospect that they may not be able to borrow as much as they could have three or six months ago when the rates were lower.
Vendors need to consider their own personal goals and aspirations and make decisions based on quality information. Experienced agents that have seen the highs and lows of real estate markets are there to assist you with making these big decisions. As agents we have an obligation to provide all information to our clients which in a downward market is sometimes uncomfortable and confronting, particularly when we are discussing someone’s most valuable asset.
The last thing you want your agent to do is have “Happy Ears” and avoid having the challenging discussions that need to be had for Vendors to make an informed decision. Some vendors will choose not to sell and hold on to their property, and others will adjust their expectations and make the decision to sell and thus satisfy the reason why they wanted to sell originally.
