Joel Davis,
Strategic Director at Image Property.
Should you buy now or wait until the market cools?
[lwptoc]By Joel Davis, Image Property
If you’re saving for your first or next home, it may feel as though the property market is running away from you.
Rising market conditions always lead to the question: Should I buy now, or would I be better off waiting until the market cools?
The thing is, the answer to this common question might surprise you.
Market misinformation
If you’re a first home buyer, you’ve likely heard many stories about savvy relatives who bought at the bottom of the market and then watched while their property appreciated significantly in a major boom.
Or every time you attend a family get-together, you’re faced with Great Uncle Bob, who says things like, “This market is too hot, you won’t get any bargains” or “You need to time the market. A price correction is coming, you should wait and get in at the bottom.”
But speak to any real estate professional, and they’ll all tell you the same thing – the bottom of the market is only visible to most people in the rear-view mirror.
The same can be said for the top because most people don’t know when the market’s peak (or the bottom) has passed until median prices are showing significant change.
And that doesn’t happen until many months after the peak, or the trough has passed!
So, it’s a misapprehension that anyone can “time the market” with any great skill.
Time in the market matters
Another misconception is “timing the market”.
As the reality of COVID became clear in early 2020, there were dramatic forecasts of a major housing slump that would seemingly last years.
In reality, it was a dip and lasted a few months at most.
While some parts of the market have fared better than others, most areas in Queensland are enjoying strong buyer interest and significant property price growth, which is a situation not set to change anytime soon.
At the end of the day, there are two reasons why people buy property – for a home to live in or for investment purposes.
If you’re buying a home to live in, then your timing is always driven by your need, which is often over the short-term period in front of you.
Meaning, regardless of market conditions, most people have to buy when the time is right for them, rather than waiting for some mythical market dip that most people won’t be able to recognise in the first place.
Experienced investors understand that time in the market is always more important than trying to time the market, so they buy when and where is the best fit for their investment strategy.
History has shown us property’s resilience over the years, with prices experiencing an upward trajectory over the decades.
In the southeast corner, there is every indication that prices will be firmer again this time next year, which begs the question: what are you waiting for?
