Scope for negotiating prices in Canberra?

[mouseburger]

Hi. I live in Canberra and am researching to buy my first home here - PPOR, not off the plan, preferably somewhere around north-west Belconnen. I've read Margaret Lomas and Patrick Bright's advice on negotiating prices (e.g. never pay retail; walk away if the agent tells you another buyer is involved), and I'd be interested to hear from people who have bought property in the ACT on how realistic this advice is.

It seems to me that a lot of people are willing to pay above retail. Several people I've spoken to say they don't negotiate, they just pay the advertised price no questions asked, or higher if it's $xxxxxx+, because they reckon it's the only way to get your foot in the door. Agents always say someone else has made a higher offer (even if the property has been on the market for months). Maybe I'm just looking at in-demand areas but would appreciate feedback on how much room for negotiation there really is in Canberra. Thanks in advance

 

[Nemo30]

I live in North West Belco and have three properties there. There is definitely scope to negotiate. It isnt a hot market at the moment. Prices have softened a little in the last 6 months, but not a huge amount. Properties are moving.

I watch part of this market closely - happy to give my 2 cents worth if you have any properties in mind.

 

[Rolf Latham]

I've read Margaret Lomas and Patrick Bright's advice on negotiating prices (e.g. never pay retail; walk away if the agent tells you another buyer is involved),

glad you are describing a "regional" market, in Sydney, youd be very very very fit but homeless with that technique.


ta

rolf

 

[Jamie M]

Hiya mouseburger

That's a very unique username you have there

What price range are you looking at?

If it's sub $500k then there's more competition and less scope for discounting. Above $500k and there's a little bit more.

As always though - it's not about the listing price, it's about what you believe the property is worth.

Some people list their properties at a ridiculous price so a decent discount might not represent good value.

I'd be taking up Nemo on the offer too. Not many (if any) on SS would have the same insight into that section of the market.

Cheers

Jamie

 

[Redom]

Great idea to talk to nemo!

IMO, definitely room to negotiate in most parts of Canberra and in most types of stock. Even in OTP stock where negotiating prices isn't the norm, i'm seeing some pretty big discounts take place (10%+). You could, if you find the right conditions, pick up a pretty discounted property in todays market i think.

I'd negotiate with hard and fast information in Canberra. There's ample stock that isn't selling across the territory (just go to LG Hooker auctions and you'll see). Rents have slumped, in some types of stock (units), quite large amounts (20%+ isn't uncommon).

It will of course depend on the property, e.g. i'm seeing my buy/reno/hold clients in Canberra saying that theres plenty of 'bargain hunters' out there.

Best to prepare yourself with information to help negotiate.

This is generally what the agents and those with vested interests will tell you, or some combination of the above: jobs are coming back (no they're not, read the budget), the 01 boom post howard cuts (where there was no supply boom), Sydney ripple effects (true to a degree, but not a demand increase from investors who are looking past Cbr), we're at the bottom now (if they knew that they would likely be getting paid more doing something else), lots of buyer activity (they're lying), etc. Most of it is emotion or salestalk.

Cheers,
Redom

 

[Jamie M]

Best thing to do Mouseburger is to actually hit the ground and go to some open houses.

You'll get a feel for the level of competition within the price segment/location that you're purchasing in.

I'm not convinced that the Canberra market is doing as bad as suggested - but you'll need to suss that out for yourself.

Cheers

Jamie

 

[Nemo30]

I'm not convinced that the Canberra market is doing as bad as suggested - but you'll need to suss that out for yourself.

Absolutely agree. I think there are markets within the Canberra market that aren't doing well (units), but overall I havent seen massive falls in house prices.

Sometimes the people commenting on SS dont live in Canberra and may only be familiar with a particular market that isnt doing so well. That market may not be representative of the rest of Canberra.

 

[mouseburger]

Thanks all for your feedback. It's been interesting trying to sort hype from fact, and being realistic about offers. For research I look at allhomes sales history and ksou. Can anyone recommend other sites that they're found useful?

My budget is up to $450k and I'm after a 3 bedroom unit or house. I looked at a few places in Charnwood, Latham and Holt last year and those seemed to have a lot of buyer interest.

@Nemo, thanks for the offer. I'm currently waiting for new properties to come onto the market so don't have any places in mind atm, but it would be good to get feedback from someone who lives in the area in the near future.

 

[Nemo30]

My budget is up to $450k and I'm after a 3 bedroom unit or house. I looked at a few places in Charnwood, Latham and Holt last year and those seemed to have a lot of buyer interest.

Personally I would steer well clear of the units next to Magpies at Kippax - half of them are housing commission.

I also wouldnt buy in the golf course estate in Holt - parents have a place there. Lovely place to live, but lots of rental properties available. Parents neighbours have been trying to sell for nearly a year. They also have issues with golf balls breaking tiles on their roofs.

I would add Dunlop to your list. Some newer houses and in my biased opinion the pick of those suburbs (I live there )

 

[Redom]

Absolutely agree. I think there are markets within the Canberra market that aren't doing well (units), but overall I havent seen massive falls in house prices.

Yep - I think that's a good assessment. Houses holding up well, Units suffering from broad oversupply.

 

[Redom]

Thanks all for your feedback. It's been interesting trying to sort hype from fact, and being realistic about offers. For research I look at allhomes sales history and ksou. Can anyone recommend other sites that they're found useful?

Once you find specific properties you want more info on, pm your broker. They'd have access to free RP property data reports that we get access too. It generally has an estimated desktop valuation for the property, which can be useful to benchmark from.

Alternatively hit Jamie or myself up for these reports. I'm sending one of these a day to my Canberra clients a day, so its all part of the daily routine. All you need to provide is the address, number of bedrooms/baths/garage and rough guestimate at its price.

Cheers,
Redom

 

[property_girl]

Mouseburger, do as much research as you can. As Jamie suggested--go to open houses a lot. Get a feel for what properties are worth. Educate yourself so that you know as much as the re agents know. After a while you will have a good idea of their value and you will know whether the vendor is asking too much or not. If you think the asking price is too high, put in a low bid. (I always put in an extra-low bid so that I have some room for movement in the haggling process). If the ppty is being sold as a good deal, you'll be in a position to jump on it. I always ask the real estate agent how much movement there is in the price. You'll be surprised at how honest some re agents will be if they know you are a serious buyer. Good luck.

I am not familiar with Belconnen area. I know that units in the Inner South have dropped a lot and there are some good deals around.

 

[kassy]

Hi!

Also purchased a property with my husband in Belconnen in September. We put in a low ball offer and ended up just below the middle of the asking price and our initial offer. The house we bought had reasons we could use as a basis for our offer - work to be done outside, long time on the market etc... We took a few months to fully reaearch the area and decide where we wanted to buy as well as attend inspections in different areas in Canberra (we are relative newbies to Canberra, living here nearly 4years).

Agents weren't receptive to negotiation when we were looking, an agent actually said to us, " we don't negotiate in Canberra". Be polite, have your finances in order beforehand and have an expiry on your written offer. Also be willing to walk away.

Be aware, all homes lists the last advertised price not the actual sold price. You can call the agent for the actual sold price or double check it with onthehouse or one of the other websites...

Belco is a great area to live though, good luck!

Kassy

 

[DaveM]

Houses actually sell in Canberra?

 

[Scott No Mates]

Houses actually sell in Canberra?

No, it's a transfer of the leasehold.