The Buyers Agent Since 1984

Summer 2010

Hopefully now we are past the snow, volcanic ash disruption, the election and finally the budget all of which seem to have had the effect, or perceived effect, of reducing activity in the property market, it is likely that we will begin to see an increase in activity over the next few months, both in terms of properties becoming available and resultant sales. The market always suffers from reduced activity in times of uncertainty, so it is likely that be would-be sellers, who have been delaying the moment they put their house on the market; and would-be buyers who have been holding out, will now actively enter the marketplace. Overall, activity is likely to increase on pre-election levels over the next quarter.

It was a good time to sell and buy before the election, and it remains so. Prices are unlikely to increase in the second half of the year, so there’s very little reason to wait to sell. If anything, as supply increases, we may see a softening in the levels of sale prices during the rest of the year. It is noticeable how the level of price reduction notifications has increased in the past weeks, with some properties on their second or third round of reductions! However, there are still some very wide discrepancies in the values that are being placed on property. Some are priced correctly and some appear heavily over-priced. Potential purchasers must take advice to be sure of the correct price level for a particular property, before proceeding to negotiation

Low interest rates continue and the slow easing of lending by the banks will encourage property transactions. Lack of supply has been the main limiting factor to a robust market, but we predict that the situation will start to ease slowly. Vendors should take advice on value, and not expect inflated prices – stories about competitive bidding and gazumping are restricted to a tiny minority of properties that are limited in supply and perfect in every respect – and usually begin from a sensible and competitive initial price guide.

Purchasers are able to take advantage of the relative slowness of the property market to make considered decisions, comparing properties and prices, and to keep an eye on new properties coming onto the market. While there is still an undeniable shortage of quality property available, it’s an ever changing picture, and an extremely complex environment – but still one that should provide buyers with opportunities.

The need for purchasers to obtain good professional advice is more important than ever.