There are many different opinions about when you should sell your property.
Real estate is often a topic of conversation at the dinner table or over a barbecue. Many people speculate about it, and knowing its nuances can be beneficial. After all, investment properties might be the most significant investments we can make.
So when it comes to the property market, how do you know what to expect?
The property cycle is affected by:
Property prices move in cycles – rising, stabilising, correcting, and rising again. The entire cycle generally lasts between 7 and 10 years.
According to experts, there are four critical phases of the property:
People believe this is an excellent time to buy as prices are usually flat.
The growth phase begins with slow price increases, which eventually pick up.
Prices might have risen rapidly over the past few years but will have reached a peak. From here, they stabilise.
A correction is sometimes a crash. Other times, it can be a slow, long period in which prices stagnate.
These are some factors that will influence the next phase.
As the market stabilises, people will regain confidence and start buying and investing, causing prices to increase. People become more and more eager to buy, which accelerates price rises.
Eventually, affordability issues will cause prices to peak before declining from their heights. After the price reaches this trough, there is a period of relative stability. Then the cycle begins again.
There are several external factors involved.
No matter which phase of the market you are in, the following points should be considered when making a buying or selling decision:
Additionally, property cycles can be much more localised than most people recognise. Each Australian capital city operates independently, so it is unusual for them to simultaneously be in the same cycle stage.
In every city, there are individual suburbs that can undergo their own property cycles. For example, a new shopping centre may bring rapid growth to one particular area.
As there are so many influencing factors on the market, it can be hard to predict what will happen.
So how do you know when it’s the right time to sell?
First, you need to arm yourself with relevant sources to familiarise yourself with the property market. Increasing your knowledge of the local property market can help you decide when to buy or sell a property.
Attend as many auctions as you can, sign up for newsletters, browse recent sales online, and attend open house inspections.
Get a good overview of the current housing market by discussing your interests with your preferred real estate agent. This will help you interpret your situation and decide how best to proceed with your plans.
You can then start to focus on your local area and get an idea of what’s happening there once you’ve understood how the market works.
The internet is also a great source of information. Do some Googling on each suburb on your search list and speak with an agent you trust to find out what’s going on.
In an active market, you may encounter fewer homeowners trying to sell and more buyers looking to buy. The market enjoys high clearance rates with impressive sales records and increased demand for property.
During a quieter market, fewer buyers may attend open houses and there will be fewer sales.
Many owners have to decide whether to sell now or wait for a more robust market to emerge. There is a direct relationship between supply and demand in terms of sale prices. The extra supply in the market causes prices to drop when there are more sellers than buyers.
On the other hand, fewer properties for buyers to inspect can also mean increasing prices, making the state of the market irrelevant.
In any case, it is essential to choose the right agent for your selling campaign. They will help you review your options, maximise your sale, and achieve the best price no matter the market conditions.
People sell their homes for some common reasons, depending on their circumstances.
Other circumstances that might initiate a sale include:
While you may have no choice, understanding more about the local market can help you maximise the potential value of your next property transaction.
