Choosing the right time to sell your property can be a complicated exercise.
Spring has sprung and that ushers in what is traditionally the peak selling period for real estate.
But you have to weigh up personal factors as well as prevailing market conditions before making a decision.
These personal factors can trump the importance of market factors for any number of reasons.
Sometimes, you simply just have to sell.
Ideally, you can find a happy medium between both personal and market factors and this normally gives vendors the very best chance of maximising their return.
Here are the personal and market considerations you need to assess to help you choose the right time to sell.
Personal factors to consider when selling property
Everyone wants the best possible price when selling their home or investment property.
But sometimes, even with careful planning, life gets in the way.
This may be because of:
Changing financial goals
You need to free up capital to address changing financial goals.
You could be upgrading to a bigger property, empty nesters downsizing your family home or preparing to retire.
Or you may need to access capital to finance a new business opportunity or other investments such as stocks and bonds.
Ensure the sale aligns with your long-term financial goals and time horizons.
And of course, it is key to talk to your mortgage broker who will be able to recommend finance structures, loan products and refinancing options to help you adapt to your evolving needs.
Life circumstances
Changes in your personal life may necessitate a sale.
This could be because the imminent arrival of another child or the dissolution of a personal relationship.
Or you may have taken a new job interstate.
If your current property no longer meets your needs, try to optimise the market conditions available within the time frame at your disposal.
Mortgage and equity reasons
Consider your current mortgage situation when thinking about if it is the right time to sell.
This may be because you have built up enough equity in your home to the point where you are close to paying it off.
Or conversely, interest rates may rise or your income falls to the point where you can no longer afford to keep your property, forcing a sale.
Again, it is important to talk to your mortgage broker about where you’re at to ensure you know all of the finance and loan options available to you in your current situation.
Emotional readiness
Many people become attached to their properties, especially homes they have lived in for many years.
Consider carefully whether you are really ready to sell before listing your property.
Market factors to consider when selling property
When you can capitalise on market factors and they align with your personal circumstances, you give yourself the best chance of maximising your return.
Seasonal trends
Spring is the busiest time in the Australian real estate industry with the most buyers actively searching as well as the most new listings.
The warmer weather and blooming gardens make houses more attractive leading to bigger offers and quicker sales.
However, more competition sometimes means you need to work harder to make your property stand out from the crowd.
Autumn is the second busiest season while summer and winter are quieter periods.
But some sellers are drawn to off-peak seasons because they know the buyers are serious.
Economic trends
Historically low interest rates, easy access to credit and a dearth of new land releases lit the property boom earlier in the decade.
Interest rates, employment rates and consumer confidence all play a big role in the health of the property market.
Rising interest rates will eventually slow demand for houses, ultimately impacting property values.
Market cycles
Property markets tend to run in cycles and are generally comprised of four stages.
Value stage – when prices are flat, creating a buyers’ market.
Growth stage – the growing volume of buyers impacts demand, forcing prices to rise.
Peak stage – high demand pushes prices to their peak.
Correction stage – high prices forces demand to cool and a natural correction occurs.
If you believe the market is showing signs of cooling, selling as soon as possible could protect you from a lower sale price than you anticipated.
Conversely, in a rising market, it may be prudent to hold out for a period of time to gain the best possible price.
Local supply and demand
Property cycles tend to vary significantly from city to city.
There is no better illustration of that than the last 12 months in Australia.
Sydney, Brisbane, Adelaide and Perth house prices have experienced record growth and highs.
Perth dwellings climbed 24.7% over the year to August – Adelaide rose 15.5%.
But Melbourne was flat with just a 0.2% rise including quarters of negative growth.
While Hobart houses fell 1.2% in value.
There may also be significant differences in how suburbs or regions within cities are selling.
Closely examine the supply and demand within your area and talk with local real estate agents before determining whether it is a good time to sell.
Making the decision to sell your property
Even if you know it is the right time to sell your property, pulling the trigger is not always totally within your control.
Any number of personal reasons can demand or even force a sale at suboptimal market conditions.
If you are financially and emotionally ready and the market appears favourable, it could be an opportune time to list your property.
There is no ‘one size fits all’ approach to selling because of everyone’s unique, personal circumstances.
Carefully consider all of these factors when making a decision as well as consulting with your mortgage broker, such as Calder Finance, and relevant real estate professionals to make an informed decision that best suits your needs.
You should also engage the services of a professional financial adviser who can ensure you are working towards your long-term financial goals.
That is where Calder Wealth Management can help.
Contact Calder Wealth Management and Calder Finance today to discuss all of your financial needs and mortgage requirements.
The information contained in this article is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser.
Taxation, legal and other matters referred to on this website are of a general nature only and are based on Calder Wealth Management’s interpretation of laws existing at the time and should not be relied upon in place of appropriate professional advice. Those laws may change from time to time.
Calder specialises in wealth management with a focus on advice, investment, sustainability, insurance and finance.
Written by David Titley from Calder Finance Broking, for more information please visit the Calder Finance website. Please note that Calder Finance Broking Pty Ltd is a Corporate Credit Representative of BLSSA Pty Ltd ABN 69 117 651 760 ACL 391237.
