Our top tips for buying property in a heated market
A heated property market can make the experience of looking to buy a home both intense and overwhelming. As the phrase suggests, a heated market means that properties in the area you’re looking at are hot. Basically, lots of people potentially want in, just like you do.
So, when demand is high, property values are on the up and supply is struggling to keep pace with demand, how do you set yourself up to succeed?
Here at The Property Collective, we’re well acquainted with strategies that can give you an edge when it comes to getting over the line with a property in a competitive environment.
Here are our top three tips.
1. Preparation is key
Making sure that you’re good to go when the time comes to purchase is central to ensuring you’re not overlooked as a buyer and ensuring the vendor knows that you’re serious. We know that in a heated market, golden opportunities come and go really quickly so you need to have all of those proverbial ducks in a row so you can strike while the iron’s hot (fine, we’ll give the cliches a rest).
So, what does this actually look like? We recommend you speak with a mortgage broker rather than with just your bank, so that you’ve got a range of options when it comes to financing your new purchase.
Luckily for you, the Collective’s access to a comprehensive range of ancillary services means you need go no further than our own comfy couches to discuss those financing needs with an experienced mortgage broker.
2. Do your research
Knowing as much as you can about the market you’re looking to buy into will stand you in good stead when it comes to snagging your dream property. What are similar properties going for? Are there any plans for major local development? What property market data can you access? Have you got insight in to metrics such as Days On Market (DOM), with a short DOM being a reliable indication that property in your area is hot?
We recommend doing as much research as you can to tap into market insights while educating yourself with analysis and commentary from trusted sources. Time spent pouring over blogs, social media and property portals, is time well spent in our book.
In addition, having conversations with credible property professionals who have proven experience on the ground in your desired market, is an essential ingredient for ensuring that you’re well informed about the market and the property you’re looking to purchase.
3. Ask the right questions
There are a few critical pieces of information that you need to get your hands on to put yourself in the best position possible when it comes to competing for a specific property in a hot market.
Firstly, it’s wise to get a picture from the selling agent as to the level of interest the property has received since it’s been on the market. This will help you plan your strategy and put the exact level of competition you’re up against into context.
Find out how the agent is going to execute the method of sale to ensure you don’t miss opportunities. For example, if a property is going to auction, you can plan to make a competitive offer before auction day. We’ve said it before and we’ll say it again; knowledge is power.
Take the time to truly understand the price expectations for the property. Understanding the numbers driving the sale, including getting insight into buyer feedback, comparable sales that have been used to price the property and—for the investors among you—understanding the rental opportunity the property represents via a rental appraisal letter, is all information you can use to make an informed and strategic decision.
This power of work that goes into understanding as much as you can about your desired property also helps to rationalise the process and keep those powerful emotions we develop around our dream homes in check. Hot market or no hot market, the fundamental importance of you and your team of agents exercising due diligence, is central.
If you’d like to have a discussion about joining up with the Collective as you pursue the purchase of your next property, reach out.