We kicked off the week with
The obligatory no change in interest rates. That's seventeen consecutive meetings by the Reserve Bank of Australia over the last eighteen months (there are no meetings in January every year) with the status quo in effect.
I've had numerous conversations with many buyers agents over the past month about an interesting phenomenon that's starting to develop in not just my area but across the entire city of Sydney as purchasers enjoy a market that is turning more in their favour.
In a nutshell
They are reporting difficulty with many of their clients simply making an offer and deciding what amount to pay.
I have to be honest I'm not that surprised. A very common occurrence in the purchasing process are two "lightbulb" moments people go through. The first is the simple question, "do I REALLY want to buy this ?" and the second is, "what is a FAIR price to pay ?".
These moments were shortened dramatically over the past three years as the high demand marketplace frequently put buyers in a position of making an immediate decision. Whether it be the pressure cooker environment of a live Auction or a bidding war on a private treaty sale, buyers simply had no time at all to dwell on these two questions.
Now with the landscape changing
We are seeing the real difficulty for buyers acting on a property they clearly are interested in.
This is quite normal. Purchasing a property is no small task and the fear of "getting it wrong" more regularly known as buyers remorse is a regular psychological condition all human beings go through including myself (I purchased a home last year).
The trick is to ask the very simple question, "What do I think this property is worth ?".
Invariably we as consumers get sidetracked by what everyone else thinks and forget what we really want to do. This can often result in a buyer asking an agent such leading questions as "What has the interest been like ?", "Have you handed out many Contracts ?" or simply "Has anyone else made an offer ?"
Every buyer wants to feel they paid a fair price
For a property and the easiest way to measure this is by comparison to others. The irony is only a live Auction can deliver this outcome both fairly and transparently, which nearly every buyer I have ever met hates, myself included (I purchased my home prior).
So if you have seen something you like and are considering making an offer forget all the "noise" and concentrate solely on what it is worth to you. Everyone else's opinion is academic, particularly when you're on your own with a thirty-year mortgage that they are not going to help you pay.
And yes I can speak from experience. The home I purchased last year prior to Auction was for a price I wasn't sure was "fair". Many friends and family posed the obvious question "Are you paying too much ?" as well as the suggestion that by going to Auction I may have been able to buy it for a cheaper price.
In the end
My wife and I cut out all the noise and offered what we wanted (and could afford to repay) to secure the home. And yes I still wonder now, a year later if I could have got it a bit cheaper. But that thought is always a very distant second to the primary one of living in a property my family love.