Property Market
Knowing what type of property market you are in is essential when negotiating
with Real estate agents and planning out your investment strategy. There are
generally two major property markets such as the normal buyer’s market, or the
property boom, the seller’s market. Each of these property markets has
noticeable sections within them. Knowing where the property market is, will help
you in purchasing or selling a property.
The boom market has a cyclic of about every 7-10 years. During this period
prices on houses rapidly rise over a period of 2-3 years mostly doubling or
tripling in value. Buying and selling in a property boom is generally always a
good idea as you can ask quite high and normally someone will purchase it and
also if you hold onto a property for a few years after bought in the beginning
stages of a boom can be immensely profitable.
When a property boom occurs it doesn’t occur in one section all at once, it
spans most of the time from the CBD outwards. So if the CDB starts booming, the
surrounding inner suburbs soon follow and it spreads out in a radial pattern
from there.
In the last stages of the property boom normally the 6 months, it becomes
overheated. This is where property is now being bought at a price far higher
than its market value. 6-12 months after the boom is over these prices drop and
flatten out again. Then over the next years is the buyer’s market.
During the buyer’s market property takes a while to sell and the prices will
only slightly climb over the coming years. The property market isn’t doing much
here and any world economic turmoil will greatly slow it down.