Expert Auction Advice: There's Plenty of Spring in the Market
Current Auction Market Update
The market for property has been remarkably hot throughout winter, but will it give way to a boiling spring?
In the 12 months to August 2015, the value of residential real estate in Australia skyrocketed by $500 billion to a never-before-seen total of $6 trillion, according to CoreLogic RP Data. They also found that during winter, the average time for a house to sell in one of our capital cities was just 37 days, close to a record-low.
LJ Hooker Auction Manager, Ricky Briggs asserts that the combination of a low cash rate, weak Aussie dollar and share market are all contributing to prices being pushed up due to fierce competition between home buyers and investors (both domestic and international).
In fact, statistics from the Real Estate Institute of Australia showed a strong growth of credit to investors over the June quarter of 2015, well exceeding the growth of owner-occupier finance commitments (excluding refinancing).
In light of this, what can we expect in the spring market for sellers? Ricky Briggs has a few ideas.
Selling in Spring
Mr Briggs said that the lead up to spring has been hotly anticipated across the board, given that "it has been one of the best winters in real estate that we've had."
It would seem the selling season has already begun to ramp up, as statistics from CoreLogic RP Data show that the volume of auctions during the first week of spring were the highest since May 2015.
"In the Sydney metro market we had 800 properties that went to auction last Saturday, while maintaining an average clearance rate of 79 per cent," Mr Briggs said.
Mr Briggs noted that the market is showing a lot of strength, and looks to continue across the next few months.
"We're set to see most likely one of the biggest springs that we've ever seen."
Is it Really the Best Time to Sell?
It is a commonly accepted belief that spring is the best time to sell your home, but Mr Briggs asserts that you need to look deeper. He has found that every year, spring sees about 30-40 per cent more stock hitting the market.
"What that means for sellers, is that there is not only more stock to compete with, but the buyers then thin out across the properties," Mr Briggs said.
Mr Briggs affirmed that if he was to sell his own home, he would do it in either the last week of winter or the first week of spring.
The former because:
"That way you're just starting to come into the warmer days, you're not competing with the additional 30-40 per cent of stock on the market, but the buyers are already lined up, ready to purchase their homes in spring."
And the latter:
"The alternative is towards the back-end of spring, where you're seeing some really good results, everyone's wanting to purchase their home and be in before Christmas."
If you are considering selling your home, it would appear that now is certainly a good time. According to Mr Briggs, more than ever, sellers and buyers will be exchanging property.
"With the competition that we're seeing from investors and foreign purchasers, I believe that spring is going to be very plentiful in the way of results," he said.