Read time: 4 minutes, 03 seconds. Buying a home is a big decision. For first-time buyers, making such a large investment can be overwhelming. Especially, if you have no idea what to look for when...
Buyer’s Agent – A Service in Property on the Rise
“Right now, the Australian property market is like a pub with no beer, or only the really overpriced stuff.” -Reece Coleman, Maker Advisory, Head of Advisory
With this statement, the head of advisory at Maker Advisory, Reece Coleman, pretty much sums up the general mood of the property market right now. 2021 brought with it lower interest rates and high house prices.
At first, buyers went through a phase of trying to snatch up whatever they could to take advantage of the low rates.
Then when the auctions came into play, people started to have other problems. Buyers got worried about being priced out of the auctions or being asked to pay too much for a property whose value will decrease.
CoreLogic shows how property prices have been on the rise. We are looking at a 1.9% increase between May and June of this year. From a year-on-year perspective, though, between June last year and June of 2021, property values increased by 13.5%.
Factors such as very high house prices are creating the demand for more buyers agents in the industry.
The competitive landscape
A lot of people have been stressed over securing the perfect property. The truth is that not everyone can handle the pressure of being at the auction and bidding against people who might have more capital than you. This is a case where a buyer’s agent would come in handy.
Adding to this, since the end of 2020, the amount of listed property available has been down by 10.5%. This type of competitive market space will continue as banks and other financial institutions are holding firm with interest rates remaining under 2%.
Buyers agents are professionally trained to thrive in this sort of environment. Not only do they have industry knowledge that most buyers won’t know about, they also have experience dealing with sellers who sometimes may try to take advantage of inexperienced buyers.
The fear of overpaying
When you look at the fact that the median house price in a lot of areas is close to or above $1 million, you can understand the fear of overpaying. According to CoreLogic the median market price for 198 houses has surpassed the $1 million mark.
From May 2020 to May 2021, Melbourne has seen a 5% overall increase in dwelling prices. The highest increase, though, for the same period came out of Darwin. Darwin experienced a 20.3% surge in property values.
With numbers like these, a lot of people are starting to shy away from the property market. This is especially true for people who are trying to buy their first home. The Australian Bureau of Statistics (ABS) reported in May of this year that loan commitments for first-time home buyers dropped by 0.8%.
Don’t think a buyers’ agent is just an extra cost. Buyers agents are not only good at sourcing the property. They can also negotiate prices for you. An experienced buyers’ agent can help you earn returns to cover any additional expense initially made.
Timing is everything when it comes to the property market. Timing is also a factor that can cause buyers to miss out on a property. In a case like this, it is beneficial to have a dedicated expert on your side. Let’s face it. Not everyone has the time in their day to be auction-hopping or searching through suburbs with a fine-toothed comb. You can find a property much faster with a buyer’s agent, too! A buyers’ agent can limit the amount of time spent on the search.
A lot of people are now moving away from the cities in favour of the coasts or more rural regions. If you are looking outside of your state or outside of your city, a buyer agent will have that extensive reach. They can help to not only secure a property but also negotiate to close the sale without many cross-country trips.
Plus, with nearly 500,000 expats returning to the country in the 10 months leading up to January 2022, a lot of properties aren’t staying on the market for very long. In a case like this, a buyer’s agent can give you access to properties that aren’t even listed, giving you more time to close the deal.
Your buyers’ agent works with other professionals in the industry, like real estate agents and developers, with whom they share information. So they have a database of properties to look at before starting the physical search. They even know sellers who aren’t listed on the market yet. So with such a far reach, it’s easier to close a deal.
“The ratio of sales to new listings is tracking at around 1.1, implying for every new listing added to the market, 1.1 homes are sold.” – Tim Lawless, Research Director, CoreLogic.
The Australian property market is changing and people are already starting to feel the effects. Both buyers and sellers are adjusting how they approach the market. Initially, sellers had the handle but now buyers are starting to let go of the blade. The introduction of the buyers’ agent will start to level the playing field between the different types of buyers and sellers.
If you are looking for a reputable buyers agent MLS Finance has a vast network of industry experts we can connect you with. So, don’t hesitate to reach out to MLS for all your financial needs.
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