June 2012 - The Pro's & Con's of Buying in Winter
By Rich Harvey, Managing Director propertybuyer
Welcome to your June propertybuyer market update.
In this edition we will look at;
- The pro's & con's of buying in winter
- Client stories
- 2012 Vinnies CEO Sleepout
1. The Pro's & Con's of Buying in Winter
Winter is often seen by real estate agents as the quieter time of year, but in fact is often an excellent time to buy or sell. The committed buyer is still out there looking despite the onset of the cold. Traditionally, most vendors hibernate in winter and wait until spring to list their homes for sale and consequently, many purchases follow suit. The masses tend to wait until the weather is warmer and the flowers are blooming and the birds are out singing. However, if you keep one step ahead of the pack, you can equally achieve fantastic results as a vendor or purchaser.
The volume of listings clearly decreases in winter and as a vendor you may achieve an optimum price providing you find a buyer. You will have less competition from other sellers so your buyers will have less to choose from and providing they need to buy, you can maximize your price with a good selling agent. This is most evident with home buyers. However, as there are fewer buyers in the market, a purchaser can trade well as there is less competition, providing the right property is available, there is no other major interest in the property and the vendor is realistic.
The end of financial year does have an impact on property sales for some people, primarily in the case of investment properties. Vendors may have been advised to trade prior to June 30th or after depending on their property portfolio and income for that year. There may be a capital gains tax issue to minimise. Similarly, purchases may be best to buy before or after July 1st, again depending on their individual situation. Home buyers are generally unaffected.
The current market is particularly quiet with the media promotion of economic uncertainty, but with lower interest rates (even if the banks do not pass on the latest decrease) and the lack of buyers in the market, it is an excellent time to search and buy. As always, doing your research is critical but why not look before anyone else does? If you had the opportunity to be first in the department store after the Christmas sales, you would no doubt jump at the chance, so why is this any different? As Warren Buffett says; "Be fearful when others are greedy and greedy when others are fearful". Don't follow the herd when you can be ahead of the pack...
The recent interest rate cuts will help revive the property market. Economic growth is strong, unemployment low and Australia is the envy of the developed world. While consumer confidence is low, this is the BEST time in the property cycle to take advantage and secure will positioned property for future growth and yield.
Therefore, winter provides as favourable time to sell or buy as any other time of year. The key is to have a good Selling Agent if you are a seller and a top Buyers' Agent on your side if you are the purchaser.
propertybuyer has a number of services to suit your needs;
Full Search Service - We find, appraise and negotiate. Our most popular service which over 1,000 clients have selected. We'll help you identify a top performing investment property or your dream home using our sophisticated research tools. Reclaim your weekends and let our expert team shortlist on and off market properties for you.
Appraise & Negotiate Only Service - You find the property and we inspect, prepare a detailed and written appraisal, then negotiate on your behalf to achieve the lowest possible price. A powerful strategy that protects you from overpaying.
Auction Bidding Service - Are you daunted by auctions? Not sure how to bid strategically? Then hire us as your gun for the next auction. We know all the tricks of the trade!
Vendor Advocacy Service - If you are looking to sell a property we have a Vendor Advocacy service where we provide you with an independent appraisal of your property's value, assist you in selecting the best local agent, marketing and become an excellent sounding board in the negotiation process.
2. Client Stories
Here is a selection of feedback from some of our happy clients last month:
Buyer type: Homebuyer
Buyer's brief: Relocating to Sydney - bright apartment located near cycle ways and parks
Asking Price: Offers over $600,000
Purchase Price: $590,000
Buyers' Agent Comment:
Mary-Joy and Alex were expats living in New York, who were looking for a home within walking distance to the beach in the Eastern Suburbs area. They were looking to rent it out for a couple of years until they returned home, depending on their employment situation in the USA. They had originally engaged propertybuyer to appraise and negotiate on a similar property within 100m, but unfortunately it sold for $20,000 over our appraised level and approximately $70,000 over their budget. After discussions with sales agents we were able to locate an off-market property that was due to be publicly listed in springtime, upon the expiration of the tenants lease. Due to our relationship with the agent, we were able to gain access to the property and following an appraisal, we negotiated a price that was below our recommended level and approximately $225,000 lower than the original property they had missed out on. It was just 200m from Clovelly Beach and equidistant to transport and the local shops. Alex and Mary-joy returned to Australia to view the property on settlement and were both very happy.
What our clients say:
We wish to thank Anna and her team for their prompt and professional service. Anna was able to build rapport with comfortable ease, acted with integrity and efficiency and utilised her outstanding knowledge of the Inner West market to achieve a wonderful result
The communication we received through the entire process was first class. We were very pleased to get a great result so quickly, especially given our time constraints and that we were purchasing from interstate. Janine (Secondary Teacher)
Buyer type: Homebuyer
Buyer's brief: Appraise & Negotiate on 2 x 4-5 bedroom homes
Asking Price: Auction,bidding from early $1m's
Purchase Price: $1,251,000
Saving: $20,000 below client bidding limit
Buyers' Agent Comment:
Craig and Elise were looking to move from Victoria into a family home in Sydney. They had found two properties and were unsure of the local market values and needed me to evaluate and negotiate on their behalf. After analysis of two properties, we collectively decided to attend the auction on their favoured one one Saturday afternoon. I ordered and reviewed the pest and building report and had the contract reviewed by a solicitor. Craig and Elise flew up from Melbourne for the day and we also inspected a number of other properties prior to the auction, which served two-fold in making them feel comfortable and showing them alternatives in the event that the property sold in excess of their limit. The auction was a drawn out process and Craig and Elise had to return to the airport before its conclusion. Anticipating this, I asked them to sign a blank contract beforehand and give me the authority to exchange at an amount up to but not exceeding their limit. A cheque for 5% of their maximum limit was also collected. The property was passed in to me but there was a registered bidder who approached the agent afterwards and submitted an offer higher than the limit in which we had did. I submitted a slightly higher offer of $1.25m then the negotiation went behind closed doors and I managed to get the vendor down from $1.28m to $1.251m and exchanged contracts very quickly. By the time the client landed, they were happy to hear that although I had a limit of $1.271m, I have negotiated a $20,000 saving for them.
What our clients say:
As we were moving interstate and had little local market knowledge we found using propertybuyer gave us much more comfort and confidence that we were paying market rates. Our agent Matt, was very professional, easy to contact, moved quickly to deal with our requests and gave good, detailed feedback. If even in a similar situation we would use them again and recommend them to others.
Craig (Logistics Manager)
3. 2012 Vinnies CEO Sleepout - Thursday 21st June
There are more than 100,000 Australians who sleep rough every night. Can you imagine sleeping outside, on one of the coldest nights of the year?
Buyers Agent CEO SleepoutFor my 3rd year, I will be sleeping out on street for one night on June 21st for the Vinnies CEO Sleepout 2012. Senior business and community leaders are invited to rise to the challenge and experience what it is like to be homeless for one night in winter and help St Vincent de Paul Society to raise awareness of the real facts of homelessness.
All the money raised through sponsorship of participants goes directly towards the homeless services Vinnie's provide across the country.
If you would like to support me in this worthwhile cause and raising more awareness in the future, just click on the image below to donate, thank you very much.