Buying a Property in Hobart in 2022

After the fierce competition amongst buyers in 2021, the market in Hobart is finally showing signs of stabilising.  In April 2022, Hobart dwelling values declined by .3% as noted in CoreLogic’s Monthly Housing Chart Pack. In addition, the below 3 indicators can be used as further signs that the market is beginning to cool.

  1. Sales volumes are down.  The CoreLogic report showed a decrease of 2.5% in sales volumes in the last 12 months
  2. Despite fewer properties selling, there was an approximate 20% increase in new listings compared with the same period last year
  3. Days on market.  In April 2021 the average length of time a property was on the market was 8 days.  In April 2022, it was 23 days.

This last marker is perhaps the most telling.  It demonstrates that the sense of urgency felt by buyers in 2021 is no longer so apparent.  Buyers are now taking their time to assess properties properly and to make more considered decisions, rather than jumping to submit offers on multiple properties, as quickly as possible.

Despite the increase in listings and properties staying on the market for longer, it can still be a difficult time to buy.  Vendor expectations and what a buyer is prepared to offer can be wildly different and, as a buyer, you need to ensure that you don’t fall victim to offering more than you have to, or what the property is worth in the current market. 

So, what should you do to ensure that you are best positioned to buy a property in 2022 and most importantly, not to overpay?

Be ready.  More than ever, it is important to make certain that you have your loan pre-approval in place.  Banks are tightening on lending, and you need to ensure that you are searching for properties that you have the capacity to purchase. 

Know what you want. Having a clear set of requirements is very important and ensures that you are focusing your search in the right areas. You should consider things such as location, house style, configuration, condition, size, and of course, price.  Try to focus on 2 or 3 suburbs as having some flexibility will open more properties for you to consider. 

Be active in the market.  Purchasing a property can be a tiresome and draining process.  But educating yourself on the market and understanding trends can save you big money.  The best way to know what a property is worth is to inspect other comparable properties.  Once they sell, it will help you determine value for future prospective homes.  Therefore, it can be worthwhile starting the research phase a few weeks before you’re ready to buy, so that you are well informed on what properties are currently selling for.  Don’t use sales from 6 months ago, the market was different.

Another benefit of attending open homes in the areas your searching is to get to know the selling agents and to find out about what else they have coming up.

Ask a lot of questions.  Be sure to ask the selling agent a lot of questions.  Why is the guide price where it is?  Is it based on comparable sales or just on the vendor’s expectation?  Vendors obviously want to achieve the highest sales price possible, but you should only pay what is reasonable in the current market.

Do your due diligence.  The competitive nature of the market in 2021 meant that there were a lot of buyers who weren’t taking the time to do the necessary due diligence.  Purchasing a home is often the biggest financial undertaking of our lifetime and it deserves appropriate care and consideration.  Pre-offer checks should include having a conveyancer or solicitor review the contract and title to advise you on such things as possible compliance issues, covenants or easements on the title, zoning concerns, overlays (heritage etc.).  It is also sensible to have a building inspection prior to submitting an offer or make your offer subject to one being conducted.

Get help if you need it.  If you do not have the time, energy or inclination to spend weeks or months searching for, inspecting and researching properties then consider getting help from a professional.  Buyer’s agents, like myself, spend our days dealing with real estate agents to uncover opportunities and to assess properties. We are experience negotiators and use our knowledge to secure properties for our clients.  At the very least, build your contacts in the industry.  Connect with a conveyancer and building inspector so they are ready and able to assist when you need them.  And work with the agents selling property in the areas you’re looking to try and uncover future properties they have coming up that may be suitable for you.

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