What is a “Buyer’s Market”?
The term "A Buyer's Market" has been thrown around for the last few months, but what exactly does it mean? As a Buyer, you might think it means that is should be really easy to find what you like, you can buy it at a bargain price and take your time - but this is not how the market operates.
Key metrics that indicate we are in "a Buyer's Market" include:
- increasing days on market for stock
- declining overall stock levels
- reductions in price throughout on market campaigns
- average number of bidders per auction circa 2-5 parties (in Sydney metro area)
The "Buyer's market" is definately more favourable than a "Seller's market", however, there are common challenges that buyers still face in this market:
- Decreased stock levels make it hard to find a property that ticks all your boxes
- Unique A grade type properties will continue to attract buyers and garner good price results for their vendors (as buyer's get desperate)
- Vendors may have unrealistic price expeactations and/or are not really motivated to actually sell
- Buyer's struggle to quantify a properties "true value" and can often be plagued by a Fear Of Over Paying
- Available credit (borrowing power) from banks may have decreased by more than property prices
There is also not just one 'property market' - the market challenges and moves for a 1 bedroom apartment in Redfern are very different to the market of a 3 bedroom house in Bondi.
If you are looking to buy in a "Buyer's Market", don't be fooled into thinking you won't face challenges. They are just different challenges to what you face in a "Seller's Market".
What can you do to be best placed in a "Buyer's Market"?
- Ensure you have a valid pre approval before you start seriously looking at properties
- Be honest with the real estate agent if you are just browsing, or if you are a qualified and ready to go buyer
- Give the selling agent feedback on why a property wasn't right for you, and share with them the vision of what you are looking to buy (without disclosing your full budget)
- Seek professional opinion on what a property is worth and do NOT rely upon free digital property reports that provide large and unreliable ranges
- Stick to your strategy and do not be influenced or impacted by what other buyers are doing; you do not need other buyers to validate what a property is worth for you.
To help you on your way, I offer a free and confidential chat to provide advice on challenges you may be facing. This may be how to access off market properties, how to negotiate with real estate agents, how to value property, how to find exactly what you are looking for or even just a chat about where best to start.
