Slower market creates opportunity for upgraders
April 20th, 2015 by Geoff Baldwin
There is no argument that the market has slowed since Christmas however this can be wonderful news for people looking to sell their current property to upgrade to a bigger and better home according to RE/MAX Western Australia Managing Director, Geoff Baldwin.
“Right now there are approximately 14,000 properties on the market which is around 40 percent more than this time last year so upgraders do have a larger selection to choose from however many a worried that they won’t achieve a good price for their current property”, Mr Baldwin said.
“The brutal truth is that an upgrader may need to accept less on their current property but there is little doubt they will enjoy a parallel discount on the one they buy and this is when the sums really add up in their favour.
“In an example where 12 months ago, a person was selling a $500,000 property to upgrade to one worth $800,000, the gap was $300,000. Today, in the slower market, although they may have to take $480,000 for their existing home they are now more likely to buy that $800,000 home for $760,000 reducing the gap to $280,000 and saving them $20,000.
It’s also very relevant that when the market slows the dearer properties are hit hardest while the cheaper homes, up to around $600,000 continue to sell readily as that is where the buyers are most prevalent.
“The secret is to not look at selling and buying in isolation but to instead consider the whole changeover package and by doing so it can often be found that selling to upgrade in a slower market is an advantage rather than a disadvantage”, Baldwin said.