By Rich Harvey, CEO, propertybuyer.com.au
The Sydney property market has cooled, and looks set to cool down even further in the coming months. So, what do the property experts do when the market slows? Is there a way to capitalise on it?
Here’s what sellers, home buyers, renters and investors should be doing to make the best of it.
If you’re a buyer…
If you’ve been thinking about getting into the market, now is a good time to start looking. It may be the first chance in a long time that buyers can get a foot-in-the-door in Sydney property - which will always be a good area to invest in property.
All the factors that made Sydney real-estate so hot still remain very much in place: a fundamentally strong centre in a great economic position, a solid business base and good employment rates, and, of course, Sydney has all the natural traits to delight buyers from across Australia and the world, so we’re probably not looking at a very long period of cooling.
If the 2018 market predictions are correct, prices will sag and then flatline for a while, but are likely to pick up in the next growth cycle, so it’s a good idea to start being proactive now.
It’s not the time to make rash decisions, however. Analysing locations, price points and property types is still crucial. Read our Sydney 2018 market overview here.
If you’re a renter…
There has been a major boom in new apartment buildings and high-density buildings in Sydney over the last few years, and the cooling market is likely to translate into more options and better prices for renters, at least in the short-term.
Of course, you won't see rental rates in high-end buildings dropping to mid-level prices, but you can expect a bit more choice and a bit more power when it comes to negotiating your lease. This is especially true if you’re looking at a neighbourhood with multiple new apartment blocks because leasing agents will have to price competitively to attract tenants.
If you’re an investor…
With the current growth forecasts being as subdued as they are, most investors are likely to pause this year. However, we would encourage investors to take a strategic long-term outlook and see the period of slower growth as an opportunity.
You may not see massive capital growth in the short term, but the slower market gives you the opportunity to buy the type of property you’d have had to aggressively compete for over the last few years when there were more buyers than sellers.
If you’re a seller…
You don’t have to hold off on selling in 2018 but you do need to adjust your strategy. What worked when the market was red-hot isn’t going to work now.
When the market was burning up, sellers could expect to have multiple offers within the first week - now you may have to wait a month or more. Don’t panic - patience is key.
Stick to a plan while closely monitoring the local activity. Since new buyers come into the market every day, eventually someone will come that will make you an offer you’re comfortable with. Don’t settle for a low-ball offer in the first few days of the listing.
If you don’t need to sell, then it might be a good year to focus on renovating or upgrading your current home. Read our article on how to avoid over-capitalising on your renovations here.
The softening of the Sydney market presents a lot of new opportunities. As a seller, it’s not as doom and gloom as the media hype would suggest. If you keep your cool and trust that new buyers come into the market all the time, you’ll do just fine.
As a buyer or a renter, this is a great time to start looking more closely at the types of properties that may have been out of your reach for a while. The same goes for investors and developers: keep an eye out for opportunities and it could be a very good year for you.
As always, it’s important to do your due diligence and scrutinise every detail before you commit. Using an experienced buyers’ agent will help to minimise the risk significantly, especially in an uncertain market.
