You can forgive buyers and sellers for being a little confused as to what is happening in the current property market – thanks in part to the mixed signals that are being sent. Reports of house price increases for example don’t always apply and although the media is reporting that the prices that owners are obtaining are rising, this doesn’t always happen at ground level and it certainly isn’t happening in every suburb in the country.
Like most other things in life, you can’t generalise and it is exactly the same in the property world. Yes, sellers in certain parts of the country may well be getting their full asking price, but this is not necessarily the norm and sellers who read the news and base their selling decision on what they read may be disappointed.
There are ways to overcome this problem and one of the best methods of ascertaining exactly what is happening in the area in which you live is to speak to an estate agent – but not just any agent. Grant Gavin, Broker/Owner of RE/MAX Panache which operates in the northern suburbs of Durban, says that speaking to an agent who specialises in a certain area is the only way for buyers and sellers to find out exactly what is happening in a particular suburb.
“These people generally eat and sleep property and are ideally placed to answer any questions regarding property prices and sales in a specific area. They know what is selling and what isn’t, they know what is a fair market value and if a property is over-priced.”
In his opinion, those who work outside a specific area may not be that au fait with all the local trends. They may well be able to advise on general property matters, but because they do not operate in the specific area in question, may not be in a position to know the nitty gritty of what is really happening.
The importance of knowing exactly what is happening in the area where you are buying or selling property cannot be over emphasised. The one phrase that South Africans have become used to is that it is a buyer’s market. Again, while this is true in many towns and cities around the country, it does not apply to every suburb.
Gavin states that there are areas in South Africa that have never felt the full effects of the recession and whilst property prices may have fallen ever-so-slightly, demand has remained fairly strong. There are other areas that initially felt the effects of the downturn, but have now recovered and well-priced (not to be confused with under-priced) properties are selling fairly close to the asking price and are selling quickly.
“The Durban North and La Lucia suburbs are a prime example of this. The demand for property in this area is always strong and sellers who price according to the market are selling their homes at the moment within days or weeks, rather than months. Most agents who operate here will tell you that their biggest problem is getting sellers to understand that although the demand is on the increase, buyers are still not willing to pay above market value for a property.”
There are always going to be two types of sellers. Those who need to sell and those who don’t. Those that don’t generally get burnt as listing a property for an inflated figure can damage the reputation of the property. These types of sellers cause themselves harm and often find that buyers are still not interested when the situation does become urgent and they lower the asking price as it is then assumed that there is something wrong with the home.
The good news is that there is a buyer out there for every home, regardless of size, position and condition, as long as the price is correct. While the over-pricing of homes is nothing new - we all love our homes and are emotionally attached -in many instances, the problem is that the current market is not very forgiving on sellers who are still trying to set the record on their street with their home sale.
The message, it seems, is crystal clear, do your homework, speak to the right people and make an informed buying or selling decision based on fact and not on fiction.