A single street, townhouse development or unit complex with several homes on the market can signal a warning. Perhaps you’ve been vying to purchase for a number of months but the tightly-held nature of the area has made it impossible, but almost overnight, for sale signs pop up simultaneously. This can prompt concern for some and for others an opportunity that creates choice and bargaining power.
Spring is noted as the season that activates buyers and sellers. An increase in listings within a specific area could be due to the dynamics of market behaviour as well as other influences.
Despite recent reports of a quarterly downturn to Sydney house prices, it appears vendors are not discouraged. New listings have risen across all Sydney regions.
The south experienced the largest boost, jumping by 21.4 per cent annually to 1203 houses (includes houses and townhouses) listed for sale during the September 2017 quarter when compared with the September quarter of 2016.
Vendor activity in the south-west, the inner west and the west jumped about 16 per cent when comparing the September 2017 quarter with the same period last year, with 3705, 881 and 4112 houses respectively listed.
Canterbury Bankstown increased annually by 10.2 per cent to 726 houses, and the lower north shore by 9.3 per cent to 401 houses listed during the September 2017 quarter.
Increases in other areas were relatively low by comparison. The Central Coast grew annually by 5.4 per cent to 1832 houses listed in that quarter, the northern beaches grew by 4.3 per cent to 532, the upper north shore increased by 4.2 per cent to 1801 and the city and east by 3.5 per cent to 590.
The upbeat nature of new vendors in each region could be the spring effect, or the result of vendors reacting to the negative house price growth over the quarter, creating an element of urgency to enter the market before prices make any further correction. Related: Should you sell before buying a home?Related: Buyer’s agents: A major property advantageRelated: Should your home have sold already?Use a solicitor to uncover anything adverse that could affect a home’s value. Photo: Louie Douvis
Other factors, like the ripple effect, could come into play. An astounding nearby sale result that smashed price expectations can become the impetus to list.
Economic implications can also drive a surge in listings. Normally prevalent in holiday areas, distressed sales as a result of an economic downturn can mean a flick to the second home for an instant boost to finances. In the era of historically low interest rates, this is something that could occur in our ‘everyday housing landscape’, particularly for those who have financially overextended. This is not much of a concern now, while interest rates remain low, but is certainly one to watch.
Ultimately, due diligence is required for any purchase. If anything untoward occurs in a specific area – perhaps a recent development or major infrastructure approval – a solicitor should uncover anything adverse that could affect the home’s value. If something is discovered, use it as a tool to negotiate a better price.Continue reading »