Downsizing? Where to from here
Downsizing? Where to from here
One of the fastest growing property markets in Melbourne is the ‘downsizer’ market.
Gone are the days where the ageing population is happy to potter around the house and garden until greener pastures present.
The modern downsizer is more often than not active, financial and very keen to travel and socialise.
Most downsizers are searching for similar things –
- Single storey (or at least the main bedroom downstairs)
- Super close to amenities (less than 1km, but more preferably less than 500m to shops, restaurants and rail transport)
- Large open plan kitchen/meals/family area
- Plenty of space to entertain
- Low maintenance, easy lock up and leave property
Many have lived in their larger family homes on bigger blocks for more than 20 years. The homes are often requiring regular ongoing maintenance and repairs, detracting from time that could be better spent catching up with friends, going to the theatre, playing golf and travelling.
The family home is likely to be one of the biggest investments a person/couple will make and it is fair to expect that if one is ‘downsizing’, so should the house and the budget, hopefully leaving some money aside for retirement and travel.
The most desired home amongst the downsizers appears to be a single level home on a smaller block of land (own title), allowing for a courtyard/outdoor meals area and maybe a small pool. The internal flow should have a large open plan kitchen/living/meals area, a smaller secondary living room, three bedrooms and two bathrooms. A garage is preferred, particularly if it has direct entry to the home.
Working through the options, next is the townhouse (with main bedroom downstairs), followed by the single storey villa units (6-8 in the block) and finally the apartments.
The number of buyers entering this market is growing, it seems almost weekly.
Buyers who think they will be able to downsize their budget may be in for a nasty surprise.
On 5th September 2015 16 Courang Road, Glen Iris was auctioned and nearly all the interest was from the downsizing buyer group.
This property was last sold as ‘land’ in 2012 for $1,150,000. A new single storey home, a good floor plan and a pool resulted in a massive $2,920,000 with three buyers still bidding above $2.8million.
In November three smaller properties in Malvern, (15a Dixon Street, 30 Dixon Street and 5 Irving Street) sold well over their reserves between $1.9m-$2m with multiple bidders, leaving a large number of under-bidders still wanting.
For those trying to ‘value’ these types of properties using the traditional ‘land plus building’ method, these prices do not always ‘stack up’. In some instances, they don’t even come close.
Buyers are finding that instead of depositing money into their savings account, they are withdrawing even more to remain competitive in this growing market place.
Some buyers may think that the only way to be successful in this market is to find more money. However, if this were the only way to purchase homes successfully, professional services such as ours would very quickly become obsolete.
Buyers first need to have a good understanding of what they want and then be able to identify properties that can meet these needs. We believe that many of the answers lie in the ability to recognise these properties, then being able to obtain and decipher the information effectively. Appropriate strategies can then be implemented to help create certainties and increase the opportunity of being the buyer.