The Sydney property market is positively booming. As the rest of the country’s housing market experiences what head of research at CoreLogic, Tim Lawless, calls a “broad-based boom”, the capital city of New South Wales is also in the midst of an unprecedented surge in housing prices.
According to a March report by The Urban Developer, Sydney’s house prices rose 2.5% month-on-month and 2.8% year-on-year, with the median value of property in the city currently standing at $895,933. House prices in Sydney showed an overall increase of 3% and unit prices increased by 1.2%, pushing median values to $1,061,229 and $738,254, respectively.
With demand outweighing supply, and interest rates in Australia at record-lows, home sellers are reaping the benefits of a seller’s market. Westpac Banking Corp’s prediction that property prices would rise 20% over the next two years will motivate current homeowners who are considering entering the market to give that plan some more serious thought, and it’s easy to see why.
What should would-be home sellers expect when a seller’s market is in effect, and how should they approach the sale if they are to reap the financial benefits of this upturn in the market?
Expectations when selling a home in a seller’s market
Investopedia defines a seller’s market as “a market condition characterised by a shortage of goods available for sale, resulting in pricing power for the seller”, also adding that a seller’s market in real estate would lead to “firm control over setting the house price”, as multiple bids are placed on the property in the face of less competition on the market.
To put it another way, a seller’s market provides home sellers with an opportunity to capitalise on greater interest and less competing properties in the city or suburb. Because fewer properties are listed for sale, bidding wars on certain properties may ensue, leading to great financial gains when interested buyers outbid one another. For home sellers, this is wonderful and heartening news, while buyers will be keen to take advantage of the lower interest rates, which look to remain so until at least 2024.
The real estate agent assisting you in the sale of your property will probably recommend that you also put these favourable circumstances to good use. Not only does a seller’s market mean that here is a definite chance of earning greater profits than would be the case, had a buyer’s market been at play, but it also has the added benefit that a property will probably also not spend as many days on the market as it would in a different economic climate.
With all these factors taken into account, what can home sellers do to make sure that they don’t botch the sale of their property when they have everything going for them?
Preparing to sell in a seller’s market
A seller’s market holds a great many potential benefits for sellers, provided they approach the real estate market with targeted efforts to reach the greatest amount of potential buyers. Even when the amount of competing properties is less, sellers still have to do all they can to draw the attention of prospective buyers and convince them to purchase their property instead of the other properties that are also vying for buyer’s attention.
The price any home ultimately sells for is always tied to the price that comparable properties in the same city or suburb sell for. As your real estate agent will explain, comparable properties will share some of your home’s features, which is exactly why you have to ensure that your house makes a good impression from the very start.
Hire an experienced agent
The very first step to real estate success is finding a real estate agent who understands your needs and expectations when it comes to the sale of your property. This person will be assisting you in completing one of the largest financial transactions you are likely to undertake in your life and, as such, you will need to completely trust them to handle negotiations on your behalf and to effectively market your property, both in the online sphere and in more traditional media.
A good real estate agent is one that has completed the training that is necessary to do business in this sector, but has also gained experience in the field, and especially in the area where your home is located. They will have seen many seasons as a real estate agent, and will have witnessed the local property market’s ebb and flow, navigating the choppy seas that are the real estate market to guide sellers on the voyage from “for sale” to “sold”.
When deciding on an agent to help you sell, take care to do thorough research and to interview a number of real estate agents before settling on your partner to property success.
Of course, sellers can choose to go it alone if they are unwilling to pay commission for the services offered by a real estate agent, but it should be mentioned that this will mean also completing the significant administration associated with the sale of the property by themselves. If you don’t love admin, this alone should be good enough reason to convince you to sell with the help of a real estate agent – but there are plenty of additional reasons to do so.
Update your home to attract buyers
In preparing the home to be put on the market, your real estate agent will conduct what is known in the industry as a comparative market analysis. This entails comparing your property with similar ones in the city or suburb, and is done to establish an asking price that is in line with what similar homes are going for.
The comparative market analysis and a home inspection will also reveal those aspects and features of the property that deserve a little more attention to catch the eye of potential buyers.
Real estate agents generally make recommendations with regards to renovations and repairs to the property that will add value to the home when it is time to sell. While some properties will only need minor cosmetic renovations like a fresh lick of paint here and there, others may require more extensive work. Here, we may see the need to update an out-dated kitchen or bathroom, for example. While more significant repairs can be more costly, these will go a long way in ensuring that buyers feel confident in making their purchase. Make no mistake: meticulous buyers will examine every nook and cranny of the property for flaws, so taking care of any maintenance ahead of home inspections is absolutely essential if you are to secure a quick sale.
Even when there is less competition in the local property market, pricing a home correctly is of paramount importance. Any first-time home seller will tell you that home pricing seems far simpler to do than it actually is.
A home that is priced competitively is on par with other similar comparable properties in the city or suburb. Set the price too low, and you’ll sacrifice profit unnecessarily, but set it too high, and buyers will rather go for the similar home that’s a little cheaper.
Again, your real estate agent is a godsend when pricing the home. As they have been doing business in the area for a significant amount of time, they’ll know what appeals to buyers, and will be able to set a price that is realistic and attainable, whilst giving homeowners a chance to make a good profit on the sale. Read more about setting the right price for your property here.
Maximise marketing tactics
Efficient marketing is key to selling a home quickly. When utilising the services of a good real estate agent, you’ll gain access to some of the biggest online real estate marketing platforms and to a large database of potential buyers. Your real estate agent will probably recommend a combination of online and more traditional marketing approaches, like newspaper ads.
When preparing your home for the market, make sure to let your online listing shine, as this is where most potential buyers will probably first come across your home. Good home staging and professional property photography will make your listing stand out from the rest – ask your agent who they’d recommend.
Sydney is currently in the midst of a surge in house prices, laying the foundations for a seller’s market, which is likely to remain in effect for at least the next three years.
With the price of property steadily climbing, and demand far outweighing what is available to potential buyers, it is important that sellers take advantage of the moment and market their homes efficiently. This means updating the property in a way that appeals to the largest group of potential buyers, but it also requires pricing the property in a way that is fair and in line with what similar properties are going for.
Whatever the economic climate, a trustworthy and experienced real estate agent will help you to sell quickly and at the right price. Looking for an agent that you can trust? Speak to Perfect Agent to get a personalised list of agent recommendations.