Chapter News

Transparency is a must in this market

By Peter Chauncy - McGrath Estate Agents

  McGrath Estate Agents Partner and 2014 REINSW Awards for Excellence Residential Salesperson Category winner Peter Chauncy shares his insight into what his selling market looked like during the last quarter and how he is preparing for a strong summer property market.

Market conditions

Most of my business is transacted on Sydney's Lower North Shore which has traditionally been an auction market. About two thirds of the sales are transacted by auction although sometimes the transaction is not necessarily completed on the day.

We have been selling many properties off market at strong prices as buyers seek to secure the right properties. This often suits the sellers who are looking to balance price with speed, expense and fuss.

With limited stock and very high demand recently, there's no doubt the past few months have been a frustrating experience for some buyers in their attempts to make the winning bid.

Auction winning times

This is not the market to place a ceiling on prices and with the depth of competition the more transparent the process, the better for all parties.

I can understand when owners are reluctant under tighter conditions, as nobody really wants to see their property pass in. However, analytics show auction will still provide a superior result in a shorter period, regardless of market conditions.

Like anything, there are variables and it's critical the agent has a clear tactical approach and has the experience to handle the sensitive situations that an intense period of lead-up marketing and the auction day can present.

I've chosen auction to market my own property in the past which reflects my faith in the choice of strategy. At the end of the day auction is a generic word, it really comes down to the execution.

Ongoing strength

The market leading into Summer will be strong. This year, we don't expect clearance rates to soften due to higher supply. I'd be surprised if clearance rates dipped under 80 per cent in the immediate term through to Christmas.

We expect no significant change in conditions especially with the ongoing stability of interest rates and strong net migration.

The seasonal trend will continue, although there is no rush to market. With most markets improving across the country sellers are having a serious think before they sell to buy. There's no doubt many owners have delayed a selling decision preferring to secure a home firstly.

Overall, listings are up at the moment about 20% year on year which is promising and will no doubt lead to a higher volume of sales yet again. There will be small peaks and troughs, but I think it's going to take a significant economic tightening and or interest rate increase to see a material change.