Against the grain

We have just hit the peak spring market. This is what buyers have been waiting for – the busiest period of the year for new listings.

While it might not feel like it, there is plenty of great stock out there right now.

Your REA and Domain feeds should be lengthening by the day with plenty to scroll through!

If you’re a motivated buyer, it is a great time to buy.

Ask yourself this questions… Do you think the market will be higher, lower, or the same in 12 months?

If you are hedging your bets on a couple of rate cuts next year and prices to have at least held steady or possibly increased, why would you wait?

Most people don’t set trends, they follow trends.

Most buyers wait until the market is heating up or hot before buying.

Only the bravest buyers bought in the early days of Covid in March/April 2020. They were the ones who got the best deals when uncertainty was at its peak.

By late 2020 the market was heating up again.

We witnessed prices go up by 20 to 30 percent in the 12 months from mid 2020 to mid 2021.

Granted, Covid was a one-off, but markets swing incredibly quickly.

Sentiment can completely reverse in a matter of months. We can go from a buyer’s market to a seller’s market within a quarter.

Paradoxically, most buyers are more comfortable buying in a seller’s market than a buyer’s market.

They’d rather pay more with competition and social proof, than pay less in isolation but feeling like no one else wants the property or they are overpaying.

It’s irrational but it’s human nature.

It takes a lot of nerve to go against the grain.

It helps to take a long term perspective though. Investors in Stonnington have had close to zero capital growth over the last eight years.

If you bought and sold a single front in Stonnington within the last eight years, chances are you broke even or there abouts, once factoring in stamp duty, selling costs and improvements, unless you got lucky with the timing. Many have lost money.

If, however, you have held a property for 10 – 14 years, you might have doubled your money, with most of that growth coming between 2010 and 2016.

Only with hindsight will you know if you bought at the bottom, the rise, or the peak of the market.

If you’re an owner occupier, you still need somewhere to live in the meantime. Property is not just an investment vehicle. It’s accommodation.

Hopefully we can help you find some nice accommodation this spring!

Feature property: 30 Lambeth Ave, Armadale