What is really happening in this super slow property market?

 

 

This week I decided to reveal what is really happening in this super slow property market. I have been hearing and seeing the impact of higher interest rates on the market and wanted to know if it was like this everywhere. I have been asking colleagues from several states what their feedback from buyers and sellers has been and I heard the same responses everywhere.

 

When there is a boom going on buyers know that they won’t grab a bargain. Unfortunately many assume that when the market slows down the fall will be as meteoric as the rise. However, as discussed in the things that affect property prices constrained supply in affluent and middle-class areas almost never plummets. Sellers that are not financially stretched wait and that further limits supply. So, it seems that from Sydney to Broom and Darwin to Hobart the property market is super slow and favouring very few.

 

 

To see whether the markets were very different I recorded what buyers and sellers were saying – permission sought of course. I should state these were middle-class urban and regional suburbs – as these are the typical areas, I work in.

 

I have put together the feedback from other agents in many locations across Australia with the responses from my buyers and there was a resounding unanimity.

 

These were the top seven buyer responses to the slow market:

 

 

  • “It’s very hard to get the banks to commit to pre-approval”

 

 

  • “There is not enough stock on the market”

 

 

  • “The prices haven’t come down much”

 

 

  • “We cannot borrow as much as before so we cannot afford what is available”

 

 

  • “We have to budget for more rate rises”

 

 

  • “Why aren’t the sellers more motivated”

 

 

  • “How long do you think it will take for the banks to stop raising interest rates?

 

 

 

These were the top seven seller responses to the slow market:

 

 

  • “I wish I had put it on the market last year”

 

 

  • ‘I’m not selling for that price – I’ll withdraw it”

 

 

  • “I will wait till the market recovers”

 

 

  • “Cannot believe how long it is taking to sell – would have been gone by now last year”

 

 

  • “Should I wait for Spring?”

 

 

  • What do I need to do in this market to get a good price?”

 

 

  • When do you think the interest rates will stabilize?”

 

 

This is obviously annoying for buyers and sellers but this is the reality of this slow property market. The media hype is that – hype. Yes, the market is slowing but many sellers are withdrawing their properties rather than fire sale them.

 

Almost no sellers are slashing their prices they are waiting instead. As there are so many sellers holding on for their price time on the market is noticeable. Buyers no longer can assume there is something wrong with the house or price they accept this new norm. Moreover, buyers are often revisiting properties they initially rejected thinking the price would drop.

 

Whilst this is not a proper survey and there is no real metadata markets across Australia are experiencing the external environmental impact of interest rates. My real estate Vox Popoli exposed the reduced borrowing is causing less demand but it is also limiting supply as sellers hold off.