After threats of a market crash, property prices recommenced their upward trend before a mini pause at the end of 2024. Now of course, the forecasters are taking bets as to when interest rates will drop and prices will continue on the journey upward one again. There’s still pockets of opportunity, though if you’re waiting for a better time to buy, you had better get busy now.
Basic numbers
We’re currently still experiencing a supply crunch resulting in a lower number of properties available to purchase. This has caused auction clearance rates to hover around the 50 to 60% mark, and the number of days on market has levelled out as sellers become more realistic about pricing.
Many buyers were keenly waiting on more interest rate increases to see prices soften but those times are now over. Also, as sellers start to see prices soften (though not by much) most will hold on putting their properties on the market causing the number of properties on the market to tighten up.
This will lead to more competition for properties available for sale causing prices to at worst hold ground, or really ramp up again.
Of course, there’s pockets of the market that will continue to drop but you can mainly look to Victoria for this, due to the massive land tax changes introduced by the State Government in 2024. These changes have created a structural reason for Victorians to sell, whereas property owners in the rest of Australia don’t have these restrictions.
Opportunity
The current market presents a window of opportunity for buyers who are in the financial position to make a move. Experienced buyers know that softer or sluggish markets are when the most amount of money can be made, though it’s critical to avoid being caught up in the numbers.
Many buyers become fixated on achieving the absolute cheapest purchase price. Not only will this lead to missing out on some great purchases, but it leads buyers to fall victim to the ‘lemon’ purchase. This is because during slower markets, there’s a higher proportion of properties that have ‘unfixable’ issues or features that some buyers won’t be able to handle.
Great time for great property
The best approach in the current market is to take action on great property. It might be a property where the price has dropped minimally or not at all, and might be above the suburb median, but will mean you’re actually getting a bargain compared to what you might have had to pay in the peak.
It’s these types of properties that will leap in price as soon as the market changes again (and we all know how quickly that can happen).
How to select great property
The most important approach is to look for property that matches your needs and targets. For example, don’t purchase a massive renovation project if you’ve never renovated before.
Next, look for properties that have ‘opportunity’ embedded within them. If you’re attracted to property that has been recently updated, expect to pay at the upper end of the price band no matter what the market is doing.
Alternatively, you’ll have the most long term success if you aim to purchase property that has plenty of uplift still to be realised. If you’re ready for more details and want to know how to identify property that will continue to deliver no matter what the market is doing, check out our new guidebook – 8 things you must know before you buy a property.
About the author
Debra Beck-Mewing is the Editor of the Property Portfolio Magazine and CEO of The Property Frontline. She has more than 20 years’ experience in buying property Australia-wide and has extensive experience in helping buyers use a range of strategies including renovating, granny flats, sub-division and development. Debra is a skilled property strategist, and a master in identifying tailored opportunities, homes and sourcing properties that have multiple uses. She is a Qualified Property Investment Advisor, licensed real estate agent and also holds a Bachelor of Commerce and Master of Business. As a passionate advocate for increasing transparency in the property and wealth industries, Debra is a popular speaker on these topics. She is also an author, podcast host, and participates on numerous committees including the Property Owners’ Association.
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Disclaimer – This information is of a general nature only and does not constitute professional advice. We strongly recommend you seek your own professional advice in relation to your particular circumstances.
