This winter we have had a very active and competitive local real estate market. Although it has been an uncertain few months for everyone across Australia, our local real estate economy has not felt a downturn, yet.
As we continue to see good sales results, the number one question homeowners are asking me is “Should I sell my house now, or wait?” Here are my key considerations when deciding whether to wait it out or sell now in the current real estate climate on the Upper Northern Beaches.
Sell now or wait to see what the market does?
Now more than ever, with the current Covid-19 climate, it is a matter of certainty vs. risk.
Also, as I say to those who ask me this question, the decision to wait or to sell straight away will depend on a multitude of different factors, from current market conditions to the urgency of your own personal circumstances.
The Certainty – we are certain of what is happening right now.
An abundance of Buyers
There are a high volume of buyers on the look for the perfect property purchase this end of the beaches. Why is that? Well for one we have seen a significant shift in work life balance and flexible work arrangements, notably buyers coming from the inner city and eastern suburbs. Another reason is interest rates remain low and in some cases it’s more cost effective to manage mortgage repayments than rent.
This winter our open homes have exceeded the usual number of inspecting parties, for example last Saturday we had 38 parties through one open home at 39 Hillside Road Newport. Numbers like this are far beyond what we usually see this time of year.
- Low stock
In the 2107 postcode stock remains low. As this chart from RP Data shows us, stock has continued to decrease in Avalon Beach (and Upper Northern Beaches) for the last 10 years, which reflects the greater Sydney property market as listings remain low city wide.
- Premium Prices
Basic fundamentals are prevailing, low stock plus high demand equal positive market results. An abundance of buyers is what drives the current energy in the marketplace and this energy is why we are still seeing good results for sellers.
Take for example these three sales in Avalon Beach from the last 7 days.
22a Binburra Avenue – 2 Bed cottage sold for $1.35 by public auction10 North Avalon Road – 4 Bed duplex sold for between $2 and $2.2 million by private treaty7/4 Binburra Avenue – 3 Bed townhouse sold for between $2 and $2.2 million by private treaty
At the high end prestige market notably $5 million and above we are seeing significant transactions. This market typically tracks the global economy reflected in the stock market and the globally stock market broadly, remains strong.
The Risk – we don’t know (for certain) what will happen in the year ahead.
Although everyone likes to have an opinion, real estate agents included, none of us are certain how the remainder of 2020 will pan out. With the unprecedented events of the year and the national economy being propped up by stimulus packages, border closures, and the “new normal” of social restrictions and regulations we cant be sure of what the future looks like in the market.
We do know the Upper Northern Beaches is a hotspot and whatever correction or crash may eventuate, we remain in an exclusive pocket of the market that always holds its value in the long run. It is somewhat protected from downturns that may affect other parts of the city as we have a high proportion of owner occupied properties and people want to live here. In my latest market report you can read about the continued strength of our local property market.
If you are considering to sell later in the year or in 2021, ultimately if you sell and buy in the same market, your risks are mitigated and it won’t matter so much what the market is doing, it’s just the transactional costs you will incur.
If you are thinking of selling in Spring or 2021 and you have the choice of selling sooner, I would lean towards selling now, taking advantage of the current certainty in the market, the abundance of qualified buyers and good sales results we are achieving for our clients.