Very few people would disagree with the notion that the Australian property market is certainly experiencing a huge boom. In fact, says the Sydney Morning Herald, the national property market is “on fire”, with house values in Sydney rising 3.5% in May 2021, for a total rise of just more than 15% for the year up to that point. This sharp rise in prices is even more pronounced when one compares the amount of homes in Sydney that sold for at least $1 million just a decade ago – 15.5% of homes in Sydney sold for more than a million in 2011 – to the amount of homes that sell for more than $1 million in Sydney today. In 2021 up to June, almost 52% of homes sold in Sydney were bought at a price of at least $1 million – that’s a jump of almost 40%!
The rise in the overall price of homes is a part of a surprising run on the real estate industry’s behalf, driven by a range of factors, and primarily of a discrepancy between the amount of properties on offer on the market, and the amount of sellers interested in purchasing a home.
Driving the price of property up, the lack of supply on the market is probably due to a range of factors, but certainly also thanks to government relief measures imposed early in the COVID-19 pandemic to take some of the financial burden off of consumers. Property owners were less likely to be forced to put their homes on the market, while buyer interest was sparked by historically low interest rates, government incentives, and a surge in owner-occupiers rather than investors.
As prospective buyers started considering upgrading their home to something that better suited remote work, the demand for new homes quickly started outstripping supply. A delay in the completion of new properties hasn’t helped, either. Even so, home sellers have been reaping the benefits of the seller’s market, garnering huge profits with every percentage point property prices rise by.
Australia’s Real Estate Boom: Here to stay?
While prices look to continue increasing for probably the rest of the year, this unprecedented growth in the price of Australian properties cannot continue forever. As economic principles dictate, prices will only increase for as long as demand outweighs the supply of available properties. With home prices showing marked growth especially in Australia’s capital cities, an increasing amount of buyers are starting to be priced out of the market, unable to afford the few homes that are being advertised.
It’s fair to assume that the balance might start shifting as soon as demand starts petering out, but it is anyone’s guess as to how home prices will look a year from now. Real estate experts didn’t expect the rapid growth in the price of property in the face of the pandemic, and many have had to adjust their predictions for the rest of the year. Thanks to a less severe than expected economic fallout as a result of the pandemic, the world of local real estate has proved resilient, with many real estate agents taking the pandemic in their stride in terms of the marketing of properties. Utilising the technology that kept offices running throughout the health crisis, agents were able to offer prospective buyers novel ways of viewing properties they were interested in purchasing, keeping the market going despite many challenges.
Any real estate agent worth their salt will tell you that trying to predict the way the property market will perform is folly. While we can safely presuppose that Australia’s current real estate boom will come to an end, we can’t yet say how things will look a year from now.
Should You Sell Your Home?
Homeowners who have been thinking of putting their property on the market may be interested in entering the realm of real estate sales in the midst of the property boom, hoping to make huge profits when their home is nabbed up by one of a host of interested buyers. But does a boom in property prices mean that it is a good time to sell?
Real estate agents who have been doing business in a particular city or suburb for a while will have witnessed the way the market performs in different circumstances. For this reason, real estate agents are a mainstay in the market, and essential on any seller’s journey. A good real estate agent will be able to assess a property and tell the owner whether the home will perform favourably on the open market.
To do this, they will also likely employ a comparative market analysis to gauge the overall condition of the home, also taking into account all its features, along with comparing it to other, similar properties in the same city or suburb. By doing this, real estate agents are also able to recommend a selling price that is fair to the buyer and also guarantees a good profit for the seller.
Home sellers can greatly benefit by taking a page from the books of the other properties their own home is competing with. After all, comparing homes with one another is exactly what potential homebuyers will be doing. Make no mistake, though: assuming that a home will sell because demand for property is high will cost sellers, dearly, especially if they think they can sell a sub-par property as is.
Selling Your Home in Australia
Home sellers often underestimate the things they need to do to make their property appealing to the broadest possible group of buyers, neglecting to pay attention to the way their home is presented in its online listing. Considering that the online listing is the first way to grab the attention of potential buyers, this marketing channel should be used to its full potential.
To make the online listing shine, sellers should ask the real estate agent that is helping them to sell about a good home staging company to help set the scene. Staging the home is one of the best ways to make the listing as eye-catching as possible, while also taking into account what potential buyers like. In order to stage the home properly, home stagers advise that all religious and political regalia, along with sentimental items and quirky décor, should be put away, so as not to draw the attention away from the home’s best features. Sticking to a neutral colour palette is also advisable, as is lighting and decorating the property in a way that speaks to the bulk of interested buyers.
Sellers should also take care to complete any renovations to the property before the home is officially listed. Buyers will definitely keep an eye out for small issues that could cost them big bucks to repair later on, which is why sellers should always make sure that every appliance, switch and amenity works exactly as it should. Once the home is ready to be put on the market, an experienced and qualified real estate agent is of paramount importance if a homeowner is looking to sell quickly, and at the right price – even during a property boom.
Get the Perfect Real Estate Agent
Finding the right agent to help you sell is essential. Agents do not only handle all the marketing efforts associated with the sale of a property, but also take responsibility for the largest part of the administration involved in selling a house.
Real estate agents come with an arsenal of skills, and will also negotiate on the seller’s behalf, while ensuring that they still make a good profit – something in which the real estate agent has a vested interest, considering that the commission they earn also depends on it.
When using a real estate agent to help you sell, you are also gaining access to a large database of potential buyers. They understand the market they work in, know what sellers are looking for, and have the know-how to advise home sellers along every step of the process – is there any reason not to sell with the help of an agent?
The Australian property market has shown remarkable agility despite the onslaught of the COVID-19 pandemic, and home sellers stand to make lots of profit as property prices in the country continue to rise. Even so, the price increases – which have been largely driven by a lack of supply in the face of soaring demand – cannot continue unabated. As many prospective homebuyers start being priced out of the market, the balance may well shift again as demand increases.
Just how the local real estate market will look in a year is very hard to predict, though. Sellers who are planning to put their homes on the market need the services of an experienced and qualified real estate agent if they are to sell their home fast – and this is as true today as it is on any other day. Still haven’t found an agent to help you sell? Perfect Agent can help!