If you’re looking to buy or sell property, when’s the best time to do it?
Views are mixed on this. Some put it down to seasonal factors, others say it becomes a market-by-market and personal decision.
Traditionally, autumn and spring are the two distinct periods for selling property. Both are defined by key Australian holidays, particularly autumn as people often use the summer to take stock of where their lives are going and indeed how on earth to get there.
Spring tends to do well as people generally see this as an opportunity to present property in the best light and it also allows them to get their affairs in order before Christmas.
We certainly saw that with the slightly stronger price growth in spring 2016, over earlier in the year.
The tip here is that if you are selling out of busy areas, avoid peak periods as too much traffic or lack of parking can be a real turn-off.
Autumn, and particularly that pre-Easter Super Saturday auction weekend, is also when we see the largest number of property sale contracts, according to data company CoreLogic.
But Charles Tarbey, chairman of property group Century21, doesn’t buy into the seasonal factors.
“In recent years the traditional seasons of real estate have been less pronounced and sellers may be better served by researching market dynamics in the area and making an informed decision on that information,” Tarbey says.
“Winter is often overlooked as a good time to sell, however it may be possible to achieve great results in winter with [fewer] listings to compete against, which in turn may attract a greater proportion of interest compared to other seasons.”
Investors tend to have a bit more flexibility deciding when they’ll sell over owner-occupiers, depending on tenancy terms and property conditions of course.
“If you’re an owner occupier, it’s best to sell before you buy,” says Jane Slack-Smith, director of Your Property Success.
“That way you know without doubt what money you have to spend and you don’t have to get a bridging loan, which usually results in an ability to borrow less than you normally would.
“But often this means months of renting or a carefully orchestrated sale and purchase and in a fast-moving market most vendors don’t need to accept your changes,” she added.
A buyers’ market generally isn’t a great time to sell because there are more properties available for sale relative to buyer demand and this can weigh on the asking price.
The Perth housing market has been a good example of this.
“As a region it does well in favour of buyers, with historically high stock levels that has resulted in a very long average selling time and larger discounts from vendors,” says CoreLogic research director Tim Lawless.
“But stock levels in Sydney are roughly half of what they were five years ago, and it is this shortage of advertised stock that is creating urgency among buyers which is contributing to the upwards pressure on prices,” he said.
In the year ahead, property price growth is expected to stabilise and Sydney and Melbourne are expected to see a strong shift back to there being just as many buyers as sellers, plus a pull back in investors.
Many economists believe that with the US raising rates in December this will keep the Reserve Bank of Australia on hold with rates a little while longer, but it doesn’t rule out another rate cut in 2017.
Concerns have re-emerged of a recession in the first half of 2017, and that the major banks may also continue to raise interest rates independently of the Reserve Bank.
If this happens, the timing of selling property could be better suited to earlier in the year as buyer demand tends to weaken when consumer confidence suffers in times of economic hardship.
“It can be better to go earlier,” says Andrew Wilson, senior economist with Domain Group.
“We have the prospect of perhaps a recession next year that is likely to be announced in March. This could affect market confidence but I don’t think it will affect the housing market too much.”
This Financy article first appeared in Fairfax Media.