Most buyers, sellers and agents have now returned from their mid-year hiatus and, for many, a much-needed break after two very tough years.

Despite the media’s best attempts to portray doom and gloom, using the most negative adjectives and emotive language available to sell their story, the market is still transacting.

And for the better properties, we don’t believe there has been a fall in price at all.

That is not to say that there have been no changes in interest levels, prices, quotes and volume and it is also not to say that we won’t see a continuing downward drop in old prices moving forward.

The sharp rise in interest rates, with future projected rises, will no doubt have an impact on some families’ budgets, which could result in more homes hitting the market as vendors try to sell quickly before the market drops further, possibly tipping the number of buyers versus sellers out of kilter and in favour of the buyer as stock numbers rise.

It will, however, depend on the type of stock available.

We are aware of a number of properties quietly for sale requiring major renovation or new builds, where vendors, whilst they may have the capacity to continue, no longer have the desire or want to take the time to undertake the works. Renovators are, more than ever, morphing into buyers.

We have also noted more resistance from buyers toward properties that need additional money spent on them, preferring the security of purchasing a property where the price is quantified and there is more certainty around budgeting for future repayments.

For vendors who have these homes, unless they need to sell, many are opting to hold their plans until the sentiment improves.

We have noticed a great mix to quote prices. Interestingly, some vendors still think they might be able to sell for a price (including stamp duty) well above what they paid for the property only a year or two earlier.

For example, 15 Vardon Avenue Beaumaris, which went to auction on Saturday (with only some minor improvements after selling for $2.085m 15 months ago), passed in on a genuine bid of $2.285m, exactly $200,000 over. The home had been quoted $2.285-2.385m and sold later around the middle of the quote range.

Another currently for sale in Malvern East sold around a year ago circa $4.5m is now asking $5m (off market). This is only one example of many similar properties currently for sale.

Expression of interest campaigns are also increasing. Why? It helps protect a vendor’s asking price (especially if it is above market expectations) and it also provides some smoke and mirrors around ‘other interest’ when managing buyers interested in purchasing the property, unlike an auction that can make it very obvious how much interest (or lack of interest) there is.

The ‘buy before sell’/‘sell before buy’ switch has also changed. Many property owners are preferring to sell first now, mitigating the risk of not being able to sell at an expected price. This will hopefully open up stock levels, however we are not really seeing that yet.

We feel if the property is handled by an experienced agent (who has worked in many different markets and understands their area) and is quoted correctly, excellent results are still being achieved for the seller.

So where to from here? If you have confidence in your job security and borrowing capacity, it can be a good time to buy. Making sure you are buying the right home is still most important, keeping in mind some properties haven’t dropped much (if anything), depending on what you are buying while also ensuring you don’t overpay in the current market either, should you need to sell again unplanned in the short term.

The mantra we often use to our clients: buying as well as you can for your money, and the ability to make good informed decisions, still holds true today. For if the purchase decision is not right, (ie a home that seems a ‘bargain’ price on the day of purchase, regardless of suitability or whether the property is in fact in any good) then this could be very costly not only financially if you have to sell it, but emotionally if you are not happy living there.

 

Some of the better properties currently on the market; an architect’s view

11 Fraser Street Malvern – Tim Bennison/Will Bennison, Jellis Craig

14 Christowel Street Camberwell – Scott Patterson/Walter Dodich, Kay & Burton

344 Beach Road Black Rock – Oliver Bruce/Matthew Pillios, Marshall White

 

‘Off-market’ / Pre-market Properties:

• Fully renovated & extended single fronter, 3-2-1, Prahran – circa $2.5m
• Large Edwardian family home on ~730sqm, Malvern East – circa $5.75m
• Contemporary family home on over 100sqm, Malvern East – circa $5m
• Modern large family home w pool and basement, Malvern East – circa $5.3m
• Updated Art Deco home, 3-2-2, ~600sqm, Ashburton – circa $2.1m
• Fully renovated & extended family sized Victorian, Camberwell, circa $5m
• Renovated single level Edwardian, 4-2-2, Camberwell – circa $4.2m
• Single fronter, 2-1, opp. Top add value, Hawthorn – circa $1.6m
• Two storey Californian Bungalow, Castlefield Estate, Hampton – circa $3.3m
• New family size townhouse, 5-4-2 on ~350sqm, Brighton – circa $3.6m
• Family home, St Kilda – circa $4.5m
• Modern home with pool, Caulfield North – circa $4.5m