When to Buy or Sell? It’s all about the timing
That would be the crystal ball question for those who have been caught out by selling after the market has peaked, and it is already on the downward slide, or making the decision to buy when prices have reached boiling point. How much you end up paying can then determine how long it will be before the market recovers and you can at least get your money back.
There’s a definite cycle to the property market, with a few differing opinions as to how long it takes for the market to go full cycle, some suggesting somewhere between 10 and 14 years. Being prepared to take action when the timing is right is not as much about following the herd as it is about reading the market.
If we consider 6 o’clock on an analogue clock to be the bottom of the market, when there is very little movement, both in number of sales, and prices seem to have reached a low, this is the time that presents great opportunity to pick up a bargain. The well-known ‘buyer’s market’ can unfortunately be created when many are bailing out due to financial difficulty, which creates an over-supply of stock.
The ‘seven o’clock’ timeframe is when we see the number of sales start to pick up, clearances at Auctions are rising, along with prices. For those astute buyers, now is the time to move, with plenty of stock to choose from. The peak of the market might still be a few years off, and you will realise greater growth the closer you buy to a seven o’clock market, and before the herd realises what is happening.
The 12 o’clock “boom time’ is usually when prices have been escalating over two or three years, and again, many of those slower to react are now trying to pick up a property at already inflated prices. As stocks turn the corner and become scarce, they feel under more pressure to get on board. It’s at this time that the astute buyer, who went shopping between 5 and 7 o’clock, are ready to realise their foresight and cash in.
Then there’s location. My dear (now deceased) grandfather had the foresight to purchase property in areas long before they became the popular tourist attractions they are today, Golden Beach in Caloundra, with it’s very long driveway that saw the house perched only meters from the sand, or the apartment in Mooloolaba that now houses the ever popular LandMark apartment block.
At some stage though, every property will need to have some TLC put back into it, and the decision then is to determine how much additional value can be built up in a property without over-capitalising. Get this right and you could potentially have two bites of the property cherry. With Spring Hill house prices increasing from around $770,000 in 2013 to around $907,000 at the back end of 2014, Spring Hill is certainly one inner city suburb that’s ripe for the picking!