Written by Hudson Adviser Kris Wrenn
Property values in Australia have definitely slowed in some areas, and with the uncertainty around the upcoming federal election and the outcome from the financial services royal commission and the potential fallout to the mortgage market, the property sector has definitely hit uncertain times. We are in the midst of a housing downturn, with only four capital cities seeing price increases in 2018 with the rest recording declines. The capital cities continuing to record growth are Hobart, Canberra, Adelaide and Brisbane. Interestingly, Hobart has also seen the highest decline in first home owner affordability.
With the subdued sentiment towards housing the best strategy is possibly to hold your property to ride through the wave, and if in the financial position, purchase another property. We have seen a more significant housing downturn within the last 30 years, and any property within the inner circle ring should hold its value and continue to grow in the long term. A lot of buyers are sitting on their hands and waiting for conditions to settle.
Sometimes it is not possible to hold and properties have to be sold for one reason or another. A strategy that has been on the increase in recent times is that of furnishing and styling homes for sale. David McClean, general manager of Furnish and finish, said a professionally styled property can shave about four weeks off a marketing campaign and add about 12.5% on average to the sale price. He recalls two identical studio apartments in North Sydney in the same unit block that were on the market recently; the styled one fetched $100,000 more *1.
To sell a property in this current market for the best possible price you have to consider the way you choose to present your property to the market. Buyers will often pay significantly more for a property packed with visual appeal. It can be difficult to disconnect and view your beloved family home through the eyes of on outsider. This is where it might be worth employing the services of a professional. A lot of real estate agents are offering a new ‘service’ now where they will offer tips to maximise the potential market price of your property. This can give you an objective look at your house, consider buyers in the area and ways to make the home more appealing to as many of them as possible. The aim is to make your home a blank slate so that buyers can imagine themselves there. Professionally styled properties can help buyers overlook flaws in the property by creating a stronger emotional connection. Selling a property is a big decision, and selling in this current market requires a little bit of extra attention and effort. I get asked sometimes if it makes sense to spend money on my property before selling. Because every property is different it is hard to answer this question and of course the deciding factor should be the return on your investment, ROI. It is always going to be hard to gauge which is where you need the help of a local real estate agent who is knowledgeable of the local area and its buyers to offer some guidance. But whether it’s a tidy up or an overhaul, there is one thing that I agree with and that is to present your property as professionally and as stylish as you can. First impressions count and the longer your property sits on the market the more cost to you, and the more damage is done in securing a future potential buyer.
*1 Sydney morning herald