As the housing market comes off the boil, families who once despaired of affording a home are now able to buy better-quality properties than they had hoped for, perhaps with a recent renovation, an extra bedroom or in a better location.
The trend is noticeable in Sydney, where the pace of annual price growth has slumped from nearly 19 per cent in March last year to just 1.3 per cent last month. The softening price growth comes as regulatory clamps on lending have discouraged investors, offering hope to owner-occupiers.
Henny Stier of OH Property Group said in recent months in Sydney she had seen clients finding themselves in the price range of liveable homes rather than renovator’s delights, garages instead of carports, and full-brick homes instead of brick veneer.
On the north shore, one client missed out on a four-bedroom weatherboard cottage in West Pymble, but was later able to buy a five-bedroom, full-brick house two suburbs closer to the city in Lindfield. “In the past you might have to settle for a C-grade or a D-grade (property) and now you can go up one grade,” Ms Stier said.
As more listings hit the market, buyer’s agent Michelle May has seen buyers able to afford a better level of finishings or higher-quality kitchens but she finds the market is patchy.
Ms May bought a home for a client in Enmore, in Sydney’s inner west, for $1.85 million off market that she predicts would have gone above $1.9m at auction, as the vendor’s agent had a heavy workload and wanted to move quickly.
“I think consistent demand for quality is going to continue,” Ms May said. “But the low-quality, compromise properties are going to continue to feel the pinch.” In inner-west Petersham, Victoria Morris and husband Delzad Dubash, who have an 18-month-old son, Elliott, bought a three-bedroom home because they needed more space.
The property had been passed in at auction for $1.9m in May but was relisted and the family was able to buy it for $1.715m in November.
They had looked at homes slightly further from the city, in Croydon and Five Dock, but wanted somewhere more central.
Ms Morris said the falling market was “nice from our perspective”. “I think it’s just lucky timing,” she said.
Anna Porter, a director of property investment company Suburbanite, saw one client who was priced out of Sutherland in the city’s south and became “completely disillusioned”. “They were starting to look at suburbs they didn’t even like,” Ms Porter said.
They missed out on a small fibro home, but as the market softened they were able to buy a cottage on a block about twice the size for less money in their preferred suburb of Gymea.
Search Find Invest managing director Frank Russo bought a two-bedroom apartment in Bondi for a client who had missed out on a one-bedroom. “Agents are a lot more negotiable than they were six or 12 months ago,” he said.