A buyers best guide to property value
The process of buying a house presents all types of challenges. Is it structurally sound? Does it tick all the boxes? What changes could I make to improve the value? However, perhaps the most frustrating aspect is getting a gauge on a property value when it is marketed without a price.
In New Zealand there are very few agents who offer a service that’s working exclusively for the buyer. This means the vendor is the client and as agents it is our job to achieve the highest price on their behalf. When we choose to market a property without a price, we are letting the market dictate the end price without limitations. Buyers who have been looking at similar properties in similar areas will have a good feel for the approximate price range where a property sits, hence the approximate market price. Buyers who do not yet have this familiarity tend to place a lot of weight on the RV (rateable value).
Unless an agent is quoting the RV as a price guide it is probably not a reliable indication of the market value. So how are you supposed to know what to offer if you have not had the luxury of six months in the market? The best indication of what a property will sell for is comparable sales and the fastest way to access this information is to ask the agent: “When providing the owners a current market assessment, what sales comparisons did you use?”. The Real Estate Agents Act requires the marketing agent to provide the owner with a relevant market appraisal which must be based on market evidence. Knowing what evidence was used for the assessment means you have the same information as the vendor.
At the end of the day, to be successful in purchasing a property you will have to pay more than anyone else. Learning to ask the right questions will put you in the game.
Listings in the capital have picked up with the traditional influx of properties prior to Christmas. Well-presented, entry level homes continue to do well but there is a bottle neck around the six to seven hundred thousand dollar mark with a lot of similar properties competing for interest.
We have about three weeks left until the capital puts on the breaks and we won’t know the mood of next year, until next year. Key things to look out for are business announcements over the New Year period. These are designed to fly under the radar when most people are more concerned with their tans.
If you, or anyone you know, could benefit from some free and friendly advice, please do not hesitate to call. Until then, have a happy and safe Christmas holiday and look out for our next Barometer in February 2015.
Wellington property statistics for October 2014
Wellington Median Sale Price
|Average sale price October 2014 by area|
Average days on the market in October 2014 = 41.8
Have a safe and happy Christmas break and we will be back reporting on property in the Wellington area in February 2015.