What to expect when buying a home around Christmas

What to expect when buying a home around Christmas

The holiday season is upon us and there are only a few weeks until Christmas, meaning sellers, agents, inspectors and solicitors across the country are looking to make things happen before the end of the working year.

According to the latest CoreLogic research, auction volume expectations are at record highs, with 4354 homes set to go under the hammer across the combined capitals.

Sydney, Canberra and Adelaide are predicted to record their highest volumes since its record-keeping began in 2008. For comparison, 3,720 homes went to auction last week, and this time last year 2,168 auctions occurred.

There is a clear appetite for purchasing homes across the nation at the moment, so what can would-be home buyers expect when it comes to trying to get a foot on the property ladder by 2022?

 

Time crunch and added pressure

It’s not uncommon for buyers and sellers to retreat from the market by the end of November. Given that December is days away, would-be buyers may be feeling the pressure to wrap things up and sign on the dotted line for their new homes by the Christmas deadline.

A recent Australian Financial Review (AFR) article noted that industry specialists predict buyers and sellers are pushing to have property deals completed by Christmas – particularly families.

Cate Bakos, a buyers’ agent, said to the AFR: “Buyers and sellers know the process is punctuated by the summer break. If they cannot settle early, there is the chance of massive delays that could create funding issues.”

What this means for would-be buyers is that there may be less choice available, with increased buyer interest to compete with. With fewer properties on the market as homeowners go on holidays, this increased competition may drive up property prices, which are already at eye-watering levels.

And it’s not just buyers and sellers who have holiday deadlines, with solicitors and inspectors typically closing their offices between mid-December to mid-July. Real estate agencies may also have shutdown periods that buyers will need to be aware of.

And the holiday period can be notoriously difficult for organising financing due to the increased number of public holidays. All of these factors can create added stress and even delays around the settlement process.

This can understandably result in a level of fatigue for buyers. So, if you’re feeling absolutely exhausted trying to find your first or next home, you’re not alone.

 

Opportunity to nab a bargain

Keep in mind that while the holidays pose some barriers to would-be buyers, it can also offer some advantages. Sellers who are looking to take holidays and wrap up the sale process may be in a position to be more flexible on price, if you plan an effective strategy.

Whether this means positioning yourself to best win at the auction, or making a pre-auction offer, a seller may just be grateful to sell before the new year – especially if they can avoid costly auction fees.

Further, many homeowners may be looking to pay for the cost of a new home with the sale of their current home, so are facing just as much added time pressure to buy (and sell) by Christmastime. This may motivate the seller further to accept your offer on the property.

This means that it may be worth organising your paperwork for your home loan application and ensuring your pre-approval is still up-to-date before you head to the auction. You’ll want the settlement process to be as quick and as painless as possible when buying before the new year.

How to win at the auction this Christmas time

With more auctions expected than ever before, would-be buyers will need as many tips and tools under their belt to come out victorious on Saturday.

Director of TBAS Buyers Agents Sydney, Rodney McLoughlin, said: “Analysing the agents price guide and estimating a probable selling price is the key ingredient to winning at auction.”

“Where possible, start bidding towards the end of the auction to gauge the level of interest,” he said.

“Know your limit and bid aggressively, bid with confidence and without hesitation, using the same increments throughout the auction, that way the competition doesn’t know when you are getting close to your limit.”

 

Here are some of Reduce Home Loans top tips for winning at the auction:

1. Research is key: Come armed with as much research as possible to the home you want to buy, including recent sale prices and clearance rates in the same area. This may help you prepare for the potential of the property going above reserve, and in post-auction negotiations, you may be able to haggle for a better price based on your research.

 

2. Create a strategy: Whether you want to take control of the auction early by slowing down the auctioneer’s flow by bidding at your own speed or making odd increases, or play it cool and wait until the final moments to place your bid, there are a number of strategies that may help you win.

 

3. Keep your cool: Auctions are designed to be high-adrenaline situations that play on your emotions to encourage bidding. When you pair this with the added time pressure of nabbing a home by the new year, it’s crucial that you keep a cool head. Try to set auction budgets ahead of time, including your ideal spend and your maximum spend, so you have a reminder to bid sensibly.

 

For more information, or to speak to someone about streamlining your home loan application process, speak with one of our home loan experts at Reduce Home Loans on 1300 733 823 today.

 

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