Buying Property: A Negotiation Game?
March 23, 2015 Beaumaris Office News
Hodges Beaumaris director Michael Cooney has said that “the market has turned again.” In a recent article published by The Sunday Age, Mr. Cooney spoke on how the likelihood of an auction taking place is slowly decreasing. This change in the culture of real estate is due to the amount of buyers who attempt to negotiate a deal with the sellers and agents prior to the property even being placed on the market, let alone being taken to auction.
When there is a high amount of interest in a certain suburb there is a tendency for interested buyers to approach agents prior to properties being listed to get ahead and to be able to “be the only person negotiating”.
Mr Cooney commented on how this is trend is growing in the Eastern suburbs, which are in the midst of a sales boom. These suburbs include South Yarra and Richmond and extend all the way to Boroondara, Knox, Manningham, Maroondah, Whitehorse and the Yarra Ranges.
These areas appeal to the general market due to the variety of attractions surrounding the area from wineries, art galleries and fresh food markets to vast green areas and larger plot sizes for homes. Due to the increasing amount of interest in this area, the prices for homes in these areas are also set to increase.
Clearance rates from auctions continue to stay high (averaging around 80% clearance rate), but the probability of these rates dropping is becoming more of a reality with increasing frequency of buyers contacting agents directly.
Auctioning plays an integral part of the Victorian real estate culture, but with more and more buyers bypassing the auction for the agent, potential buyers need to be attentive and jump at the chance of a potential sale.