Supporting Women To Achieve Financial Independence With Property Strategies

How is the Market?

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A Real Estate Agents Perspective

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As a Real Estate Agent, I am always asked:  “How is the Market?”  Right now it is a great market and it is a great time to buy.

If the media reports that the market has gone down 20% or 40% then consider this: your dollar will buy more house.  A home worth $500,000 before, should now be selling for $420,000.  If it was $1,000,000, you will now buy it for $900,000.

My name is Christine Stow and my aim is to provide you with an agents perspective so you can be better prepared as a buyer or seller.  I am an investor, a home owner, a renovator and a mum: so I am well equipped to understand how it is for YOU.

Fact or Fiction

Although the headlines say the housing market is slow, it should not substitute for hard facts and figures.  RP Data quotes that housing prices in Melbourne this year have gone down only 0.1%.  That is, on your $500,000 house it has reduced in price only $500.  In fact in many areas including the one I work in, there has not been a fall in prices and I have seen some areas increase in median value.  You can go to RP Data (http://rpdata.net.au) to get FREE suburb profile reports.  This will give you a breakdown of the types of people living in the area, their income, parks and amenities.  Even if you live in the suburb, it is a good idea to get this information, as it lays out everything in black and white.  For example, you can look at the pie chart of how many people rent in the area.  If you are buying an investment, you should aim for at least 30% renters, as this gives you a big enough rental population to keep your place tenanted.

Find a Good Agent

A good agent will give you information on comparative sales in the area.  If they are not readily available, go to RP Data.  You can buy more detailed reports if you are really keen on the area.  It is worth doing research for yourself.  It costs money but it can cost you more in the long run if you don’t do it.

It is important when building a relationship with the agent to be a credible purchaser.  When the agent asks what you are looking for, don’t answer with “I’m looking for a bargain”.  Be specific, for example, “I’m looking for a 3 bedroom weatherboard and tile in the suburb of xxxx that’s suitable for renovation.  If it has extra land at the rear I’d also be interested.”

The agent will know valuable information such as how long the property has been on the market, the reason for selling and the level of motivation of the vendor.

The Role of the Agent

Remember that the agent is working for the vendor, but without a buyer he/she received no commission.   It is the agent’s role to bring together a vendor with a set of price expectations and a buyer with different expectations to meet in the middle and agree and effect a sale.  If you have built a relationship with the agent, you will be much more comfortable when it comes to negotiating for the property.

When buying, it is worth putting an offer in writing once you have done your research.  I have seen properties where most people wouldn’t make an offer no matter how many times they were invited to.  The first person who did put in an offer, even though it was very low, had their offer accepted. You never know what an offer in writing might do.  Remember; it is the market that determines the price of housing, not the agent and not the vendor.

You can ask questions of the agent, but the answers should not substitute for a builder’s inspection report.  Get a qualified builder to inspect your prospective purchase.  The information should not determine whether you purchase or not, but rather the best price you should pay.  If a home needs work, chances are there are not too many buyers competing for it.  Most people don’t like the work.

I am happy to answer any questions on how to buy or what to look for in an agent where ever I can help make the process easier.  I have previously attended a Property Women Workshop and have formed a spin off group: “Melbourne Women in Property”.  We meet regularly to provide networking opportunities, information and tips.  I call it a “support group for renovators, investors and home buyers.”  We have some husbands attend and we don’t ask them to wear a dress anymore.

Christine Stow  works at LJ Hooker, at the Greensborough Office in Melbourne.  You can contact her directly at christinestow@bigpond.com.au or call on 0439 385 217.

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