The clock is ticking for Sellers
Category Property Markets
According to Paul Kruger, Licensee of Seeff Hermanus and Seeff National Board Director, properties in Hermanus experienced healthy growth in prices over the past 9 years. The past five years on average was exceptional with a 18.24% growth rate. Post 2018, the latest statistics indicate a -8.82% growth in property prices and Kruger expects that this trend will continue for the next 12 months and maybe longer. People are now inclined to panic and forget the recent Boom they experienced. As a result of this Boom, very high expectations were set, however, the reality is that the Market has moved on...
All property prices go through cycles, which can be good and bad. Kruger explains this with the property clock.
The property clock is a very useful tool and can help buyers and sellers determine the perfect time to buy or sell their property or investment.
Whether you are a first-time buyer or experienced property investor or seller, you will most probably be aware of the importance of buying or selling at just the right time. If you manage to time your purchase or sale just right, it can make a difference of thousands of Rands, even Millions.
But how do you know where the market is in its cycle and whether or not it's a good time to buy or sell? That is where the Property Clock comes in handy.
There will always be a Sellers' Market or a Buyers' Market. In a Sellers' Market, stock is limited and there are many buyers. Resulting in a rise in property prices. In a Buyers' Market, buyers are limited, and they have many properties to choose from. The result is property prices decline.
The Good, Bad and Ugly of the current Real Estate Market
There is much speculation around the reasons for the state of the Market and many people blame the unrest in Hermanus, however the reality is that, yes unrest did play a role, but not as much as everybody wants to believe. Political unrest before elections will always have a negative effect on the economy as a whole, not just on property prices. Bigger concerns (and we all know this) are the high tax burdens on all citizens, very low productivity, lack of good Local, Provincial and National political leadership, theft of taxpayers' money, dysfunctional state-owned enterprises etc. Unfortunately, this can only be rectified at the ballot box during the next election...in reality we do not have any control over this. We as Buyers and Sellers must control the controllable.
Currently the Hermanus Market has moved into a Buyers' Market (Slump phase). This pose challenges for sellers and you as a seller must ask yourself three very important questions:
1. How soon do you want to move?
If you are not a serious seller then you must take your property off the market. This type of market is not conducive for testing the market. Your property can get a reputation for staying on the market too long.
2. How long has the property been on the market?
If your property is on the market for a while, then it is time to realise that the Market (buyers) are not prepared to pay your price.
3. And if you get an offer today, what will you do?
You must seriously consider all offers you get. The market is not at the bottom or turning point yet and things can get worse as no one can predict how long this cycle will continue.
The harsh reality is, in a Buyers' Market like this, you must also decide... do you want to stay or do you want to sell. If you are not in a hurry to sell or there is no urgency to sell, it is absolutely fine to stay. Rather take your property off the market and wait for the cycle to move to the Recovery or Boom phase.
Another important decision you must make is choosing your Estate Agent. The right Estate Agent can play a very important role in the successful sale of your property, but the opposite is also true. A bad appointment can cost you time and money. Never ever appoint your Estate Agent based on the higher price they think they can achieve. No Estate Agent has control over the price of your property, you have the control over the price, but the Market (Buyers) determine if they are prepared to pay your price. If they do not see value, they will simple move to the next property until they find what they are looking for. The only element the Estate Agent has control over is MARKETING. Always appoint your Estate Agent on their Marketing ability. Let them present a marketing plan to you and the marketing strategy they intend to implement
One of the key characteristics of a Buyers' market is an abundance of Real Estate Agents. Unfortunately, not all of them are qualified to deal with a difficult Buyers' Market or do not have the necessary skill-set and tools to assist you, as seller, in this difficult and challenging sales cycle. In a Boom or Sellers' Market, most agents are only 'order takers' but in a Buyers' Market, negotiation skills are extremely valuable, and not all agents possess this ability. Again, appoint your agent on their ability or skills rather than on an unrealistic asking price.
The good news is - there are still buyers out there, waiting for the right property at the right price. It is also important to note that almost 90% of buyers in Hermanus are cash buyers... and they are eagerly waiting to invest.
Kruger's message to Buyers is clear - it is the best time in five years to buy property in Hermanus. Prices has already come down by almost 9% and it is a great time to invest or buy in this beautiful and most sought-after coastal town in South Africa. If you wait too long, the window of opportunity will close and you will again pay a premium price to enjoy all Hermanus and its surroundings has to offer.
For more information on correctly pricing your home, please feel free to Contact our highly capable Seeff Team of Sales Professionals at the following numbers:
Hermanus: 028 313 0390
Sandbaai: 028 316 3310
Onrus/Vermont: 028 316 3171
Or e-mail me: firstname.lastname@example.org
Stats Information - P24, Private Property, Lightstone and Seeff Hermanus
Author: Seeff Hermanus