Vendors need to be rigorous when choosing a selling agent in Melbourne’s changing market

The residential real estate market is entering a more challenging phase. That’s why it’s more important than ever for vendors to deal only with results-driven agents who have a strong track record.

In recent weeks, several real estate data collectors have released studies showing that price growth in the Melbourne market broadly is moderating.

Most analysts are forecasting about 5 per cent annual growth for Melbourne house and unit prices for 2016 – a significant downward shift from the exceptional 14.5 per cent rate of growth achieved in 2015, according to the Domain Group.

Nelson Alexander Sales Director Arch Staver said there were still good sales happening, caused partly by a shortage of listings, which was helping to keep prices strong in demand-driven locations.

But he said the market that existed in 2014 and 2015, with sales activity rising strongly and prices achieving double-digit annual rises in many areas, was no longer so evident.

“There may be a shift in the market and in buyer sentiment as more property comes on in September,” Mr Staver said.

“In this changing market, vendors need to be a lot more diligent about doing their homework before they appoint a real estate agent.

“Not anyone can sell any house. Vendors need to really take the time to investigate their options for a selling agent.”

There has been a spike in pass-in negotiated sales in recent weeks in Melbourne’s auction market.

It’s a trend that indicates more buyers are sticking to their budgets and are prepared to wait out vendors or move on to the next property that’s for sale.

Some auctions are attracting no bidding at all. These auctions, as well as some poorly performing private sales, are frequently managed by out-of-area agents with no local presence or sales track record.

Mr Staver said the market was clearly benefiting from the Reserve Bank’s two quarter-point cuts to interest rates made so far in 2016.

“But rates are coming down to stimulate an economy that is facing challenges. They are not coming down to be generous to home buyers,” he said.

“As those challenges spread across the entire nation and the property market, it is critical to use an agent that not only has a strong track record, but also some longevity and experience in dealing with changes in the marketplace.

“You need a proactive agency with strong buyer contacts, local insight and feet on the ground.”

In the current market, making a decision to appoint an agent based on commission costs alone, or to list a property on a website based outside Victoria, can cost prospective sellers dearly.

According to Mr Staver, sophisticated client management systems used by Nelson Alexander to match up listed properties to the broadest range of would-be buyers, thereby maximising the selling price, will be a critical aid to vendors for the rest of 2016 and 2017.

“If you are considering using a website based in another state to list your property, be very aware that these unproven services will only reach people who subscribe to their website,” he said.

“More than ever, you need to do your homework. Don’t get lazy – selling your biggest financial asset is too important a transaction to leave anything to chance.”

Latest Domain Group data shows median house prices have fallen in Melbourne’s traditional real estate strongholds in the first half of 2016.

House prices in the outer east have dropped 2 per cent to a median of $722,000 and in the inner east, prices are treading water at a median of $1.4 million.

The inner south region has dipped 2.2 per cent to a median of $1.1 million, but the west and the north of Melbourne are seeing moderate increases.

It’s a market where buyers can expect more predictable sale prices, so vendors need to list with a reputable and high-profile agent if they want to achieve above-market results.

The residential real estate market is entering a more challenging phase. That’s why it’s more important than ever for vendors to deal only with results-driven agents who have a strong track record.

In recent weeks, several real estate data collectors have released studies showing that price growth in the Melbourne market broadly is moderating.

Most analysts are forecasting about 5 per cent annual growth for Melbourne house and unit prices for 2016 – a significant downward shift from the exceptional 14.5 per cent rate of growth achieved in 2015, according to the Domain Group.

Nelson Alexander Sales Director Arch Staver said there were still good sales happening, caused partly by a shortage of listings, which was helping to keep prices strong in demand-driven locations.

But he said the market that existed in 2014 and 2015, with sales activity rising strongly and prices achieving double-digit annual rises in many areas, was no longer so evident.

“There may be a shift in the market and in buyer sentiment as more property comes on in September,” Mr Staver said.

“In this changing market, vendors need to be a lot more diligent about doing their homework before they appoint a real estate agent.

“Not anyone can sell any house. Vendors need to really take the time to investigate their options for a selling agent.”

There has been a spike in pass-in negotiated sales in recent weeks in Melbourne’s auction market.

It’s a trend that indicates more buyers are sticking to their budgets and are prepared to wait out vendors or move on to the next property that’s for sale.

Some auctions are attracting no bidding at all. These auctions, as well as some poorly performing private sales, are frequently managed by out-of-area agents with no local presence or sales track record.

Mr Staver said the market was clearly benefiting from the Reserve Bank’s two quarter-point cuts to interest rates made so far in 2016.

“But rates are coming down to stimulate an economy that is facing challenges. They are not coming down to be generous to home buyers,” he said.

“As those challenges spread across the entire nation and the property market, it is critical to use an agent that not only has a strong track record, but also some longevity and experience in dealing with changes in the marketplace.

“You need a proactive agency with strong buyer contacts, local insight and feet on the ground.”

In the current market, making a decision to appoint an agent based on commission costs alone, or to list a property on a website based outside Victoria, can cost prospective sellers dearly.

According to Mr Staver, sophisticated client management systems used by Nelson Alexander to match up listed properties to the broadest range of would-be buyers, thereby maximising the selling price, will be a critical aid to vendors for the rest of 2016 and 2017.

“If you are considering using a website based in another state to list your property, be very aware that these unproven services will only reach people who subscribe to their website,” he said.

“More than ever, you need to do your homework. Don’t get lazy – selling your biggest financial asset is too important a transaction to leave anything to chance.”

Latest Domain Group data shows median house prices have fallen in Melbourne’s traditional real estate strongholds in the first half of 2016.

House prices in the outer east have dropped 2 per cent to a median of $722,000 and in the inner east, prices are treading water at a median of $1.4 million.

The inner south region has dipped 2.2 per cent to a median of $1.1 million, but the west and the north of Melbourne are seeing moderate increases.

It’s a market where buyers can expect more predictable sale prices, so vendors need to list with a reputable and high-profile agent if they want to achieve above-market results.