Melbourne’s property market has picked up the pace since the market lows of 2011 and 2012. Higher auction clearance rates, lower days on market and increased ‘off market’ transactions (particularly in the sought-after inner areas) are all positives signs of a market transitioning into recovery mode. People ask “what factors are leading this improvement?” and the answer is simple. It’s a combination of better buyer sentiment (after all, the Australian market hasn’t – and isn’t – caving in), lower interest rates, investors opting for property over shares, and of course, the ‘herd mentality’. We humans like to do what other humans are doing!
Buyers who are looking in the sought-after areas are finding that not only are they having to be more competitive with their bidding to secure good assets, they are having to be better connected with the local agents to ensure that they don’t get knocked out of the race before it even starts. In true Melbourne style, we have a solid auction period between February and Easter and for those clever buyers who are pouncing onto good assets and making strong pre-auction offers, other unlucky buyers are greeted with a SOLD sticker when they arrive at the open for inspections.
As buyer’s agents, we set up our online searches and pounce onto the good listings as soon as they appear. We let the local agents in the areas we target know what our client’s brief is so that we can be alerted to properties before they even get advertised, and we can then make off-market purchases and avoid having to bid against passionate and emotional buyers at auction. In the last two months we have purchased over six off-market properties… a larger ratio than ever before in the past two years.
The secret to great property investing is not only buying the RIGHT asset in the RIGHT area, it’s buying WELL at the start. For those of us in the industry who know our property values and recognise the properties with strong mainstream appeal, we know when to pounce early. Not every property is suited to being taken off the market prior to auction – sometimes the campaign is struggling due to the way it is being handled by the agent. Other times interest in the property is low because it’s not a great asset. But sometimes the reason for low interest in a property can simply be that it was hard for people to access during the campaign (ie. tenants who wouldn’t let private inspections take place, owners who restricted opens to just once a week), so it pays to talk to a professional. Making the right decision on when to pounce can mean the difference of tens of thousands of dollars.