According to CoreLogic home value index results, half of Australia’s capital cities saw a drop in value in the 12 months to September Brisbane, Adelaide, Hobart and Canberra were the only capitals to see growth during this time; however even in these cities growth has slowed considerably.
While slowing growth of property values isn’t ideal for vendors, it doesn’t mean properties aren’t selling at all. This period should be exactly what would-be buyers and investors have been waiting years for.
Where are the buyers?
While we might be in a buyers’ market, it’s understandable to be nervous when property prices slow down. But if buyers wait until property prices pick up again they might miss out on the best property deals.
Buyers and vendors alike, need to keep in mind that downturns are nothing new and that property markets always move in cycles.
Every market experiences peaks and troughs over time, but in general they tend to move in an upward trajectory.
How long will prices remain as-is?
There’s no saying how long until the next upturn in the market, particularly in places like Sydney and Melbourne, which are coming out of a prolonged period of growth.
There are varying opinions on how low median property prices will go in these cities but a massive market crash seems unlikely, particularly as factors such as high population growth, low interest rates and a strong economy are still keeping property in fairly high demand across these two cities.
Everyone should do their own due diligence on an area they intend to buy in and not focus too much on the city as a whole. There are markets within markets and while some areas may be slowing down within a city, others may only just be kicking off.
Focus on the long term
At the end of the day if you’re buying a property with a long-term outlook, short-term price fluctuations shouldn’t be too much of a concern.
Resist the urge to keep checking on property prices from month to month. It may take a few years before you see substantial growth, however, savvy buyers and sellers will know that there are benefits to selling in a slower growth period, because buying at the same time is relative.