Will Property Prices Continue to Fall in 2019?
Most economists believe prices will drop more over the first half of the year before stabilizing. 2018 saw a much-needed breather from unsustainable property growth and the result was a necessary correction even if it was painful for some. We believe the greatest discounts are now over but there is a little more to go.
Be Prepared Early
If you’ve decided to sell in 2019, we advise you prepare your home for sale sooner rather than later. There will be fewer properties on the market in the middle of January but just as many serious buyers out in force. In this market, it’s important to maximise every advantage so get ready to start your sales campaign before competition builds up late February and early March.
Elections have a tendency to slow buying activity. With both the Federal and State elections taking place next year, we anticipate a degree of uncertainty will surround buyers resulting in subdued enthusiasm between late March and May. We may, however, see a few more investors out looking to secure a new investment property at reduced prices before the Federal Election in May.
Perfect Conditions to Upsize
If you’ve outgrown your home and are looking to upsize, the current conditions could work very well for you. Selling first with the knowledge that prices aren’t increasing is a gift that enables you to know exactly how much you have to spend. As a consequence, you will be in a finance ready position and a very determined buyer. You will invariably be selling for less than 12 months ago but you will definitely make up the difference in your next purchase.
Consider the following scenario: If you sold a Townhouse for $1,200,000 and bought a House for $1,600,000 last year, you would have paid around $97,773 in fees and stamp duty. The net transaction cost would have been $497,773.
If we consider the same scenario in the current market, where some property prices have dropped by 10%, the figures would look like this: The same Townhouse would sell for $1,080,000 and the House would be bought for $1,440,000. Fees and stamp duty would be $86,573 and the net transaction cost $446,573.
The above demonstrates upsizing today as opposed to last year would save you $51,200.
Click https://bit.ly/2Ew9cbb to read our full 2018 Property Overview, detailing the main drivers of a very challenging year in property.