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To be able to forecast what we can expect in 2015, we need to take a close look at the current state of the economy and property market and analyse where we are in the real estate cycle.
The economy is growing but as not as fast as many would like. To counter-act a sluggish economy, the good news for property owners or would be property purchasers is that interest rates will continue to stay low in 2015. Some forecasters are even predicting that interest rates will drop further!
So far as real estate cycles are concerned, the majority of the country is an upswing. Melbourne and Sydney had a great 2014 and I can see prices increasing in these two cities in 2015 but property price growth in these two cities won’t be as good as 2014. The rest of the country can look forward to a year which will be even better than 2014.
To find out how 2015 will affect sellers, buyers, investors and renters, read on.
If you’re planning on selling a property in 2015, it could be a good year for you.
Firstly, the number of properties for sale is relatively low which puts upward pressure on the prices of properties that are for sale. Secondly, consider selling your property later in the year as property prices should be higher at the end of 2015 than at the beginning of the year.
Finally, don’t get greedy. You will often receive your best offer in the first few weeks. If the offer is within your acceptable range, take it.
With limited property for sale, there is heightened competition for the properties that are on the market. You can expect many prospective purchasers at home opens and auctions.
If you want to secure a property in 2015, I would encourage you to plan and prepare yourself. Go and see your bank and/or broker before you start looking for property so that you have an idea of how much you can borrow so that you can bid or make an offer with confidence.
If you need to sell an existing property, either sell it first or put it on the market before you start looking at other properties as an offer subject to selling your own home is not an attractive offer to the vendor.
The best news for investors is that interest rates will stay low in 2015 (or possibly fall further). If you haven’t fixed part or all of your mortgage on your investment property, you should seriously consider it. Three year (and even some five year) fixed rates are below some current variable rates.
If you plan to hold onto your investment property for a while, speak to your bank and/or broker about this.
If you are going to be looking for a property to rent at the beginning of the year, join the queue. The rental market is at its hottest from mid-January to late February so make sure your application stands out from the rest of the crowd.
Have all your paper work such as references, photo ID and employment details ready to give to the property manager/landlord at the first home open.
Once the rental market settles down from March, we can expect rents and vacancy rates to remain steady which is good news for renters.
by Peter Koulizos