Samuel Seeff, chairman of the Seeff Property Group, has stated that South Africa’s property market is undoubtedly in a buyer’s market.
State of the market
Factors such as flat price growth, higher stock levels, greater urgency among sellers, and a favourable bank lending environment all combine to favour buyers despite the higher interest rate.
While buyers are able to find good deals in the market and secure a favourable rate on a mortgage loan, the challenge in the market for sellers right now is how to sell in a buyer’s market.
One of the first things that happens in a buyer’s market is that there are fewer buyers around to compete for the greater number of properties on offer. This usually means offers are slower to come in, and when they do, buyers tend to offer lower prices.
In contrast, when the market favours sellers, and there is a shortage of properties, sellers are usually able to find quite a few interested buyers and can generally bank on a favourable offer and price. It is not so easy when you really need to sell, but you find yourself in a buyer’s market.
How to sell
If you really need to sell, the first thing to consider is to avoid the temptation to overprice your property. According to Seeff’s agents, the days of fast offers and high prices are now largely gone. Instead, the market is now dictating prices.
If you are selling right now, you may well be competing against 3-4 similar properties in your area or property category in the same price range. Thus, unless your property offers something more than those competing properties, your chances of success may depend on your price.
You, therefore, need to trust and listen to your agent. Be careful of agents who are just looking for your mandate. Rather, work with an agent who can show their record of recent sales. Be open and upfront about your needs so the agent can ensure no time is wasted to find a buyer for your property.
Consider all offers. Remember, an offer often presents the opportunity to negotiate, and if each party gives a little, you might still be able to make a favourable deal, says Seeff. You should also consider that you may not get a higher offer.
Think about the time value of money. If you sell now, you may also be able to take advantage of the favourable buyer’s market conditions and find a better price for the new property you wish to purchase. If you wait for a higher price, you may have to also pay a higher price.
It is also important that your property is in top selling condition so that the buyer has no opportunity to look for a chance to discount your asking price. The buyer should find nothing wrong when they come and view so that there is no time wasted.
Regardless of the market cycle, there are always people looking to buy and, therefore, opportunities to sell. You, therefore, do not need to wait for the market to improve to sell, especially if you are looking to move or have your eye on another property.
Writer: Gina Meintjes