Upgrading buyers face market of opportunity

If you’ve set your sights on upgrading to a larger property but have been discouraged by the white-hot competition seen at some auctions, the autumn sales season in Melbourne could boost your chances of securing your dream home.

Auction market conditions softened slightly in the last three months of 2015, potentially setting the scene for improved buying opportunities this year.

The market eased largely because thousands of buyers purchased homes in spring and early-summer. Once they were taken out of the market, it reduced competition levels for the buyers that remained.

The latter part of 2015 also saw overseas buyers pull back from purchasing residential real estate in Melbourne. In many cases, prospective buyers from China were hit by tighter capital controls imposed by the Chinese Government, which made it very difficult for people to move money out of China.

It’s a scenario that has created the conditions for a more balanced market this autumn.

Nelson Alexander Sales Director Arch Staver believes the autumn selling season offers good prospects to buyers looking to upgrade to a larger house or apartment.

He said many quality properties were coming onto the market, spoiling buyers for choice.

At the same time, those looking to borrow to upgrade their housing because of a growing family or other reasons were continuing to be assisted by Australia’s low interest rate environment.

“There is less aggressive purchasing from overseas taking place, which may mean the timing could be better to upgrade to a house that you may have been coveting,” Mr Staver said.

“Last year, that house may have raced away at auction, with multiple domestic and international bidders competing. But there may be just a touch less competition at some auctions this year.”

Mr Staver expects low interest rates to continue to be a feature of the housing market.

“The talk by most economists is that if anything happens in the world of interest rates, it is likely to be an easing of rates, because of the relatively low level of the Australian dollar,” he said.

“The US is raising interest rates, and their economy is significantly stronger.”

According to Mr Staver, quality homes tend to attract the highest number of prospective buyers.

He said buyers could gain the upper hand if they were not too hard and fast in their preferences and ready to consider a broad range of offerings.

“If you’re prepared to consider properties that tick seven or eight out of 10 of your boxes, rather than just zero in on the super-A-grade properties that everyone covets, then you’ll do well in this market,” he advised.

“We have some very fine houses coming onto the market, and what’s interesting is that there is a reasonable amount of quality at different price points.”