Australia is, as Dorothea Mackellar told us, a land of drought and flooding rains. Which is also an apt metaphor for the residential property market. Stock has been so parched in some of our capital cities that many prospective buyers have been gasping to find a suitable property for several months.
But the rains are due. Spring and the balance of 2016 should deliver abundant choice. We cannot be absolutely certain of this outcome, but an analysis of sales data over recent years shows the volume of transactions invariably builds steadily through spring and can even reach glut-like proportions by late November and early December.
Clarity of purpose is really knowing what you want. First off, is your buying campaign about lifestyle or investment? In other words, are you looking for a home or to make money? That then determines your checklist by which you will filter properties by. For a home, that checklist will be heavily influenced by personal tastes around where and what to live in, the amount of accommodation you need as well as constraints such as proximity to work and family life obligations as well as budget.
Investors, on the other hand, should set aside personal tastes and focus on identifying assets with a track record and propensity for capital growth. Within this pool, the decision to opt for a one-bedroom apartment versus a two-bedroom apartment versus a house is a function of the investor's budget. It's an erroneous assumption to think houses are intrinsically better than apartments or additional bedrooms always boosts investment return.
Stay up-to-speed
Of course, the above exercise is only valid if you're up-to-speed on current "fair" market values for target property types, which can be done by reviewing recent property sales data.
Having narrowed down your search criteria, your next test is holding your nerve and remaining true to yourself as you review on-market property. In early spring, when supply is still relatively modest, there might be few if any properties that meet your criteria.
The temptation is to compromise and impulsively buy something inferior, for fear of missing out. Don't. Give your plan a chance to succeed or at least enough time for your ever-deepening experience of the market to underpin a measured judgment call on whether you might have to tweak your expectations.
The final quality you'll need to call upon is decisiveness. It is what is required at the moment when you have found a property that ticks all your boxes. Now that may occur in the first week of your campaign or after three months of looking. The indecisive mark this moment with second thoughts about their search criteria or wonder if they should skip this property and wait for the second property that ticks all the boxes.
It is only the single-minded who win at auctions (you can see the steely determination in their eyes) or snap up a private treaty listing with a knockout bid whilst the competition is mulling over things. They aren't reckless. Their decisions aren't based on whims. Quite the opposite; they've truly ascertained what they want, they appreciate what that will cost and they've done the due diligence.
All of which starts to sound like a state of calm enlightenment. Which effectively it is, and it isn't something too many people would associate with property buying. So good luck with property buying and personal growth this spring!
Richard Wakelin is a director of Wakelin Property Advisory, an independent buyer's agent specialising in acquiring residential property for investors.
