The real estate market is cyclical \u2013 there is sometimes more demand for homes than the supply of properties for sale, and sometimes an oversupply because demand has dropped off.<\/p>\n
What they often don\u2019t know, however, is what this means in practical terms to those who are in the market to buy property and those who are trying to sell their homes, said Bill Rawson, Chairman of the Rawson Property Group.<\/p>\n
\u201cWhen you hear people talk about a \u2018sellers\u2019 market\u2019, for example, what they are really saying is that there are fewer properties for sale than there are prospective buyers \u2013 and that sellers are thus in a strong position to negotiate higher prices for the homes they are selling.\u201d<\/p>\n
During this stage of the property cycle, he said, one often hears about buyers queuing up to buy units in new developments, for example, or home sellers receiving multiple offers after a single show day as buyers try to outbid each other for the limited amount of stock that is available. It usually also doesn\u2019t take long for any \u201cfor sale\u201d boards in the area to become \u201csold\u201d signs.<\/p>\n
\u201cIt is thus also the market phase during which property prices tend to rise fastest \u2013 and usually not the best time to be a buyer. First-time buyers, especially, can have a hard time keeping up with rapidly rising prices and the resulting need for bigger home loans and bigger incomes to support those loans.\u201d<\/p>\n
By contrast, Rawson said, being in a \u201cbuyers\u2019 market\u201d means that the situation is reversed and it becomes easier for buyers to negotiate a favourable deal because there are more homes for sale than people who are willing and able to buy them.<\/p>\n
\u201cThis situation can occur for a number of reasons, such as a sudden surge in new developments and increase in the amount of stock for sale, a decline in the economy which discourages prospective buyers, or a rapid rise in interest rates that makes it really hard for prospective buyers to qualify for new home loans.<\/p>\n
\u201cBut the practical effects are always the same, namely that price growth slows right down, properties tend to spend much longer on the market before they are sold, and that there are much bigger differences between asking prices and selling prices.\u201d<\/p>\n
For obvious reasons, Rawson said this is generally an anxious time to be a seller – although it is important to note that being in this phase of the market does not mean that your property won\u2019t sell at all.<\/p>\n
\u201cWhat is more, once it is sold and you have the proceeds in hand, you are going to be in a very strong position when it comes to negotiating the price of your next home, so it is worth doing whatever it takes to achieve your sale within the shortest possible timeframe.\u201d<\/p>\n
The key is to price your home correctly from the outset, the property group said.<\/p>\n
It also helps to ensure that your home is in the best possible condition and \u201cshow ready\u201d, bearing in mind that buyers who have many properties to choose from and not much competition from other buyers are likely to dismiss any property that looks as if it needs a lot of work and just move on to the next viewing, Rawson said.<\/p>\n
You\u2019re being lied to about the value of your property<\/strong><\/a><\/p>\n