MARKET UPDATE May 2016

May 9, 2016

I stated last month that the market remains tight (listing numbers and Sales volumes). In early May 2016, this is still unchanged.

The recent 0.25% basis points reduction in official interest rates is also welcome news for potential Buyers as well as existing mortgage holders on variable rates. The market can do with any positive news right now that is available.An impending announcement of a Federal Election is a good thing (probably 2nd July) as the market wants certainty, and to understand what if any changes may affect negative gearing, projected growth and so on.

Many Buyers right now are making offers way below current asking prices to “test the market” for urgency or what they feel is distress sales. You can’t blame Buyers for that. Maybe for old or stale listings that can be understandable. There is however no evidence of wholesale price crashes or markets falling, other than the normal slight variations that we have seen for many years now.

If new listings come onto the market priced according to the most recent current market data, there is no reason a property should not sell quickly and at close to the asking price. I have said for nearly 15 years now, not all sellers and agents over price the listings that they sell. I often ask the hypothetical question, if something is worth a dollar in today’s market, and you pay a dollar, have you paid too much?

My answer, of course not. I think too many Buyers pay attention to trying to get a huge discount off the asking price instead of trying to figure out what the current fair market value is.

Sellers that want to move will find that once the asking price is perceived as close to market value, serious and genuine Buyers engage that property and often a sale or deal can be made. In a tight Buyers’ market, properties perceived as not competitively priced, are often overlooked, rejected or subjected to more aggressive low offers.

Sellers always run the risk that new stock, priced at current market value are descended upon by Buyers that have been in the market a fair while, as often we see under offer or sold happen quickly on these listings as Buyers see them as good value.

If you are a Seller please feel free to chat to me about taking advantage of the current market conditions and get sold in a reasonable timeframe for the best price.

Thank you and see you in the market place.