is director of Metropole - Property Investment Strategists property management department. She is an expert in maximising investment returns for her clients. Pam is co-author of "All You Need to Know About Buying & Selling Your Home." www.metropole.com.au I've heard of buyer's markets and seller's markets – what's the difference and what determines the market type?
In this article by Metropole Property Management Director Pamela Yardney, you'll find out exactly what's what and how different markets work...
I've heard of buyer's markets and seller's markets – what's the difference and what determines the market type?
Depending upon the economy, you may find yourself in a buyer's market - where there are fewer buyers around than there are sellers, which puts buyers in a stronger negotiating position.
Or it could be a seller's market - where there are more buyers looking for homes than there are sellers, such as during property booms. At these times the sellers have the upper hand and property prices rise.
'Market sentiment', as agents like to call it –is how much hype there is in the property market, or the proportion of buyers keen to purchase as opposed to vendors keen to sell and is affected by the general state of the economy including the level of inflation, interest rates, employment and media sentiment.
Keep in mind that throughout Australia each state is at a different stage of the property cycle. Even within each state, different suburbs will be in different stages of their property cycle – some will be booming and others may have less demand for properties.
If you can buy your home or investment property when the property market favours purchasers, with more willing sellers than mad keen buyers around, you'll generally end up with a better bargain!
While you can't always choose when you are ready to move house, a buyer's market is a great time to buy properties. That is because there are more homes for sale than there are buyers looking to purchase and the general mood about property is gloomy.
Often the media tends to play this up and run stories about high interest rates, a rise in petrol prices, the poor economy or an upcoming election.
In fact anything that gives the general marketplace the jitters and stops the majority of people making a decision is a great time to take advantage of properties that are for sale. You have a large choice of homes and don't have to compete with many other buyers. At these times you will find that sellers are more motivated and more likely to accept your 'cheeky' offers.
While many of the property markets on the east coast of Australia are hot at the moment, the mixed messages in the media with concerns about the upcoming election and one or two more possible interest rate rises hs created just this type of opportunity.
Maybe now is a good time for you to make some offers and buy a top property at a great price.
This excerpt was taken from the new book All you need to know about Buying and Selling your home – by Michael and Pamela Yardney. Click here for more details and to buy your own copy NOW!
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