Low stock levels help drive prices higher
Common wisdom suggests that spring is the best season to sell. Many confuse a strong presentation with a higher price in the assertion that ‘spring is the best time to sell’.
What is often overlooked is the vast amount of stock that is always held back for the spring market. Regardless of the season and the presentation, it’s preferable to sell with less competition not more.
There is normally an under supply of listings in winter and abundant supply in spring. Post Easter, stock on market is always low. Any current buyer will tell you that the lack of stock this year is more acute than ever.
In 2013 and 2014, the Sydney housing market experienced its strongest gains for those respective years during winter. In both years, the prices and clearance rates eased in spring, debunking the ‘sell in spring’ myth.
The lack of stock in the current market has seen price rises accelerate in the Sydney market. It’s now common for every listed property to have multiple genuine bidders, highlighting the booming nature of the market. Sellers are clearly winning in this equation as prices continue to hit new highs on low stock levels.
Aside from the season, another reason stock is so tight at present is a fear amongst vendors of selling and being locked out of the market. Many people looking to sell and buy in the market have a distinct fear of selling and being unable to buy back in.
There is a very real concern that house prices could continue rising after they have sold and before they have purchased, causing a self-inflicted financial loss. This has seen many inter-market traders hold back from listing until they have secured a home elsewhere.
Buying before selling brings it’s own set of challenges too. Whether buying or selling first, its crucial that a plan has been devised in advance of transacting.
One of the safest ways to buy and sell in the same market is to get a delayed settlement on the first transaction. This allows time to get the second transaction done.
Whether buying or selling in winter, you can expect to see strong competition at every property listed. There is every indication to suggest that winter will be a hot market again in 2015.