With inflation and interest rates slowly starting to stabilise, things are looking up for property buyers in 2024. If you’re thinking of getting in on the action, these are things you’ll need to think about to make the most of the opportunities currently available.
According to Rawson National Finance Manager, Leonard Kondowe, the affordability outlook for 2024 is currently positive with a potential interest rate decrease expected mid-year. As a result, he says buyers who act quickly stand to benefit from today’s low property prices as well as more affordable bond repayments just over the horizon.
“It’s a great time to get into the market, but don’t be tempted to overextend or rely on the interest rate decreasing to maintain your affordability,” he says.
“Budget wisely, buy within your affordability level, and save for as big a deposit as possible. You’ll not only get a better finance offer; you’ll also give your property investment a much more secure financial foundation to weather whatever the future holds.”
Polish your financial profile
Other ways to improve your property finance outlook include paying off as many small debts and monthly expenses as possible and closing any unnecessary store accounts and credit cards.
“If you have any black marks on your credit record, the earlier you address them the better,” says Kondowe. “It takes time to rehabilitate a credit score and build the kind of responsible history that lenders are looking for in their bond applicants.”
The good news is, buyers with a strong credit history could see very motivated lenders competing against each other to finance their property purchase.
“Lenders are definitely bringing their A-game to secure the best applicants,” says Kondowe.
“With experience and great negotiation skills, we’re getting very favourable offers for well-prepared candidates.”
Know the market
Market conditions are currently very much in favour of buyers, according to Rawson Properties Regional Sales Manager, David Jacobs. That means, for now, buyers have the upper hand in terms of purchase timing and price negotiations. However, Jacobs says these conditions won’t last forever.
“We are expecting demand to increase in 2024, which means buyers will be facing a bit more competition,” he says. “As such, it can be useful to speak to a property professional in your area to get a feel for how fast properties are moving, what prices they’re achieving, and how best to maximise your chances of a successful offer.”
Do the prep
To give yourself the best chance of having an offer accepted once you hit the market, Jacobs strongly recommends getting prequalified for a bond, and prioritising the sale of your current property if you have one.
“Until demand picks up, sales are still going to be a little sluggish,” he says. “You’ll have a better chance of having an offer accepted if the sellers don’t need to worry about unsuccessful bond applications or suspensive condition holding up their own transfer for months on end.”
Think through your needs
Jacobs also recommends approaching the market with a clear plan of action around what you’re looking for, and what you’re willing to compromise on.
“It’s unusual to find a property that ticks all the boxes unless you’re building from scratch,” he says. “Having a list of your must-haves, nice-to-haves and absolute deal-breakers is a great way to focus your property search, and reduce the risk of impulsive decisions leading to buyers’ remorse down the line.”
Pro tip: Remember, property is a long-term
investment. Make sure your list of requirements extends beyond your current
needs to consider your future lifestyle expectations as well.
While some properties sit on the market for months at a time, Jacobs says others are selling before they even have time to be publicly listed. “This happens regardless of buyers’ markets or sellers’ markets,” he says.
“The best properties always sell quickly, most often to a buyer actively on the real estate agent’s radar. If you’re doing it alone, trusting the property portals to show you everything available, it’s inevitable that you’ll miss out on some of these opportunities. It’s a much better option to have a real estate partner actively working to find your dream property and ensure you’re first in line when it come to market.”