How to save a tonne of money when buying a property
Think about these tips when searching for a property in a depressed market.
Buying investment real estate when the market is down can be remarkably lucrative.
But you still have to look closely to make sure you’re getting a worthwhile deal in a buyers’ market — and clever property investors won’t be so dazzled by the opportunity of a ”bargain” that they overlook their long-term master plan.
In a sellers’ market almost any price an owner puts on a property may result in a sale and such great conditions tend to camouflage ”over-optimistic” prices.
In a depressed market, it’s much simpler to buy property at more sensible prices because there’s more home on the market than serious buyers.
Real estate isn’t a simple market, though. There are many sub-markets that operate individually, even different streets.
Quality properties in particular areas can still sell within 24 hours of being advertised on the market, whatever the current position of the market, it is so essential you get educated with buying strategies used by smart property investors.
Buy always in demand properties
Smart investment properties to buy are the ones that will always be in demand for the average person in that area. For most investors, this means obtaining a property that’s close to the city centre. For others it may mean choosing houses or units priced at near the median price for their areas close to amenities. Normally owner-occupiers and investors love these types of dwellings.
Locations that perform above the average over time normally have a high land area and are usually your best choices.
With units, the rule to go by is to go for an apartment in a very popular/convenient location with eating places and train station nearby. It should be in a well-constructed building with a high land-to-unit ratio.
An extra tip investors don’t think about
Find a unit that has something unique about it and that other units don’t have. This will help you with the resale of the property and make it more desirable than the 100s of other units in the area.
Many sellers have been knocked around by changes in their situations. While mortgagee sales are a clear indication of the real estate market slowdown, you also need to be on the hunt for other signals of sellers that are financial underpressure.
The number of marriages applying for divorce normally goes up in times of financial difficulty. Other sellers give up on property ownership and go back to renting. You don’t always find out these circumstances at the first time you meet the agent. But if you nudge him or her and ask the correct questions, you’ll secure knowledge that may help you buy a good property at a surprising price.
It’s mad to buy a home at below market price if it’s in an area where prices are indicating a drop. Some property coaches teach that this is not a good time to guess or to rely on the ripple effect to push up capital growth in suburbs on the edge of proven growth suburbs.
Property gamblers do there best when markets are going up. With the number of properties on the market growing in many areas, your chance to make a profit by spotting properties in mature suburbs is higher. Why take the risk on an unreliable area?
Search for multiple advertisements
Selling a property with more than 1 agent shows a desperate vendor. Because no single agent has an exclusive to sell the property, you should able to easily buy directly off the seller. This can get rid of step $20,000 or more in real estate agent’ selling fees from the transaction. You need to step carefully on doing this because legalities could be involved, however. Many of these sellers desire an agent to finish off the final sale. You can even ply one agent off one another, by seeing which agent will sell it to you the cheapest.
This happens because all the agents will be desperate to sell it to you, as they are competing against the other agents adverting the same property. At the end of the day, the reality their property is advertised with several real estate agents shows they want to sell and fast. Unfortunately this works very quickly against the seller.
Go fast, go slow
A buyers’ market means buyers are more in charge than sellers. It’s easier to negotiate a slow settlement on a property sale but don’t overlook that speed is also a valuable bargaining tool. In a very slow market, cash is best. A seller may settle for somewhat less for a fast settlement compared with some other higher offer on slowed terms.
If you have discovered a property you desire and have completed your usual planning and checking methods, a cash is king unconditional offer and a fast settlement can somewhat reduce the price you pay.
About Jhai Mitchell
Jhai is an award winning Internet Marketing Real Estate Agent for Elders Toongabbie and Kings Langley. After running his own internet marketing business he has now set his own sites for the real estate industry. He observed that 90% of real estate agents did not know how to market themselves online. Jhai is now fixed on one goal. To teach real estate agents that they can market online so much better than they currently are.
Since then he has been consistently quoted in the Sydney Morning Herald and Real Estate Business online. He is a regular guest blogger on TheHomePage.com.au, sharing his expertise of marketing aspects for the Real Estate Industry. His biggest passions are his wife, martial arts, dogs and most of all property.