Sellers encouraged to meet 2025 price expectations,
“Dear Vendors,” the nation’s buyers are saying, which could be interpreted as a heartfelt message to the country’s vendors.
“We love your property and are eager to buy it, but not at any price. Please be realistic.”
“By doing so, we can form a strong relationship. However, if you don’t adjust, you might remain unsold for a long time.”
As Christmas approaches, this plea is being echoed by agents across Australia, urging vendors to reconsider their expectations.
There has been a near-record surge in listings this year, increasing by as much as 35 percent.
Despite this, many owners are still attempting to sell as though it’s 2021, missing the current market conditions.
“But the market is not the same as the boom we saw just a couple of years ago,” explained Dionne Wilson.
“Even high-quality blue-chip properties have experienced a decline in price, making it a challenging time for vendors.”
“Yet many owners still believe they can secure top prices, which is unlikely given the current conditions.”
“With an increase in listings and cautious buyers, prices have softened, leading to firm conversations with vendors about market realities.”
Recent research reveals that, in most parts of Australia, the market is slowing down, with price growth decelerating.
In some areas, prices are even sliding backward, highlighting the challenges faced by sellers in today’s market.
The latest Domain House Report, for example, revealed that house prices in Sydney increased by only 0.6 percent.
In contrast, prices dropped by 1.5 percent in Melbourne and 1.2 percent in Canberra during the September quarter.
Moreover, Brisbane, which has been one of the strongest markets recently, saw a modest increase of just 1.5 percent.
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Unit price growth has also shown a similar weakening trend, reflecting the broader market slowdown in recent months.
In Sydney, prices increased by just 0.9 percent in the last quarter, while in Melbourne, they rose by 0.5 percent.
However, despite these increases, Melbourne’s prices are still 4.8 percent lower than their most recent post-COVID peak.
In Canberra, prices fell sharply by 4.5 percent, leading to an overall annual drop of 10.3 percent.
Meanwhile, in Brisbane, prices rose by a modest 3.3 percent, indicating a more stable but slower market.
The problem, according to Wilson, is that some agents are telling vendors what they want to hear, inflating prices.
They then spend money on advertising and marketing, but ultimately fail to secure a sale due to overpricing.
“I recently spoke to a newer agent who claimed he was doing well and listing a lot of properties,” she said.
“However, he had not sold much. Listing is easy, but selling requires understanding the market and pricing correctly.”
“It’s a highly price-sensitive market, and we’re advising people not to list unless it’s necessary to free up debt.”
“I expect prices could decline a bit more before improving. If interest rates drop, we might see more listings.”
“Such an increase in inventory will likely put more pressure on prices, making it even harder for sellers.”
In Sydney, Vicki Laing of Laing Real Estate suggests that vendors should thoroughly research pricing, just as buyers do.
“Have a serious conversation with your agent about pricing, and don’t just go with the highest price offered,” she advises.
“Look at the prices asked and achieved by comparable properties in your area and be realistic in your expectations.”
“Be prepared to make deals, such as offering extended settlement dates, especially if you’re selling first, then buying.”
This strategy can also help in a fluctuating market, allowing for smoother transactions and more flexibility.
“Laing also advises buyers to carefully check that they aren’t overpaying for a house or unit before committing.”
After doing thorough research, if a property seems overpriced, buyers shouldn’t hesitate to make an offer regardless.
“It’s a dynamic market right now, and everything is negotiable,” Laing explained, highlighting the potential for flexibility.
“Make sure to visit properties in person rather than relying solely on online price guides or advertised prices.”
Looking at the property physically can help you understand its true value, and you might find negotiation opportunities.
Auction clearance rates have been slipping, with Sydney’s rate falling to 58.6 percent in October, signaling a market slowdown.
Some commentators predict that prices in Sydney and Melbourne could fall by up to 5 percent next year.
Ewan Morton of the eponymous agency remarked, “Vendor expectations have been above market levels, which is common during market shifts.”
“Vendors are often the last to recognize when the market has changed, but reductions in some suburbs are already happening.”
“As a vendor, you can still achieve good results, but you must price your property realistically to show value.”
In Brisbane, the market remains more solid, with strong demand continuing despite a spike in listings this year.
However, even in Brisbane, vendors are being asked to adjust their asking prices to align with current market conditions.
“There has been a slight reduction in prices, but it’s not substantial, and time on market is still favorable,” said Cathy Richards.
“There’s still strong activity, and we’ve seen some excellent results. The gap between vendors and the market is minimal.”
“It’s likely just a 1 to 2 percent adjustment, reflecting a slight shift in the market dynamics.”
