The comments below were published on Talking Property with Domain.com.au in response to a blog posting “Price Discounting” by Louis Christopher.
Just 2 points to make based on my observation of the market as a buyers’ agent:
- In the above 1.5 million market, there are many sellers listing quietly at the moment because they are testing the market and don’t want to go through the full process of advertising their properties etc. The seller may have seen a property they like and would like to upgrade – however, they can only do so if they achieve a certain sale price on their existing home. In these instances, bargains are hard to come by as these sellers are more than likely looking for an above-market price. If they don’t achieve that, they simply don’t sell and trade up.
- “just because a vendor has discounted their property, doesn’t by default make it a bargain” – this is absolutely true. I can easily point to several properties which were ridiculously overpriced to begin with when they were first listed over a year ago, and are now still languishing on the market. One in particular was originally listed as over 3.2 million and is now (only) asking 1.8 million. However, despite the multiple drop in prices, there are still no buyers – probably because the property is now perceived as ‘stale’ as Louis mentioned or it might be that 1.8 million might still not be seen as good value by potential buyers. More than ever, given the current economic climate, people are seeking ‘value for money’.
About Oliver Stier
Oliver J. Stier is the Director of OH Property Group, a leading Sydney buyers agency. He studied Quantitative Economics and Finance at Cambridge University (UK), University of Toronto (Canada) and Princeton University (USA). In addition to being a licensed real estate agent, Oliver also holds the Chartered Financial Analyst (CFA) designation.