Australians love property. We love reading about it, we love hearing about it and we love talking about it. It’s a media staple for every major news outlet and there are dedicated writers who have a full-time gig covering every detail of ‘the market’.
Our insatiable appetite for property news not only contributes to but creates a proliferation of click-bait hungry headlines about the “tanking” market or the “booming” market, sometimes in the same week and even from the same publication. Here’s a classic example taken from the Financial Review earlier last week.
You could be forgiven for being confused about who to believe and if you listened to everyone’s opinion you’d go insane anyway. When you’re trying to find clarity amid the contradictory coverage, the question remains: Where should I get my information from?
Ok…so is it a good time to buy?
As a buyer’s advocate, the question I’m asked most is: How’s the market going?
When people ask this question, what they really want to know is whether it’s a good time to buy. The simple answer is: it’s always a good time to buy…if you know what and where to buy.
There are some advantages to the market in its current state. Anxiousness around selling during a pandemic means it’s easier to negotiate if you’re the one who is buying; interest rates are at an historic low so debt is cheap; property is worth slightly less than it was a few months ago; immigration numbers will bounce back, as will the economy. But if the pandemic has shown us anything about how rapidly things can change it’s that you cannot pick the bottom of the market. No one can. If there was a formula for it there wouldn’t even be a market so it’s futile to ask whether now is a good time to buy based on ‘the market’.
‘The market’ is not one house that we all buy a piece of. It’s thousands of suburbs, different property styles and many more sub-categories of those styles. It’s the vendor situation, the quality of the agent, the scope of improvement, the asking price and the sale price, it’s a myriad of variables, very few of which can be controlled.
Knowing the right question to ask
Let me give you an example. An agent mate of mine had a quiet weekend with open homes. As a result, on Monday his attitude towards the market was negative. Because he had a quiet weekend, he believes this to be a reflection of the whole property market and will now be telling people the market is going down.
Put into perspective, he is only one of thousands of agents, in one of hundreds of suburbs, in only one of many cities. Does he have all the information needed to label the market?
It’s not just agents I hear from – many brokers, accountants, punters and even baristas also hold an opinion on the property market that they’re happy to share, some positive and some negative. And while some are better placed and more exposed to the elements than others to form an opinion, opinions are free and easily obtained. Be careful whom you listen to when forming your own opinion because either way, someone is there to help support it.
When buying a property, be careful not to let someone else’s experience or emotions determine your investment decision. Steering only a couple of degrees off course in the early stages of an investment could define where your financial future ends up.
Asking the wrong question will yield the wrong answer. Similarly, searching for an answer from hyped up headlines will only generate more questions. Property is a long-term strategy so you should invest when it’s the right time for you not when the media tells you.