SALE CHANGES SPARK BUYER CAUTION

24th July 2006

Perth's sizzling property market is a seller's dream, but buyers are being cautioned not to be caught out by recent changes in the way homes are being put up for sale.

Buyer's agent Trevor Dunkley of Property Wizards Buyer's Agency said huge demand for housing in Perth, from both investors and homebuyers, had led to a shift in sales techniques that could hit uneducated buyers hard in the hip pocket.

"People need to keep their wits about them in this market because sellers know that right now the property frenzy is causing some people to panic and pay too much," he said.

Mr Dunkley said there were several key changes that had come about in recent times that buyers needed to be on the lookout for.

"One of the big areas that can catch buyers out is expression of interest selling," he said.

"This is becoming increasingly popular, but can be dangerous for investors who may get caught up in the emotion this sales method can generate, much like at auction.

"Often buyers overpay because they haven't actually established the value of the property - the message is to investigate what the property is actually worth and don't pay more than that."

Mr Dunkley said a trend now often teamed with expression of interest selling was to limit the time in which buyers could see and make offers on a property.

"At the moment many sellers are only making their home available for viewing at home open and they're not accepting offers before this time," he said.

"Both of these techniques work to create a pressure cooker type environment where buyers come together at the same time, increasing the chances they'll compete against each other to force prices higher."

Mr Dunkley said another area of concern for buyers was that many sellers were moving away from listing specific prices when advertising their homes - choosing instead to list them as 'from' a certain price.

"In the past, many sellers would as an example give a range of say $335,000 to $350,000 and work within that, but because sale prices have in recent times exceeded expectations a lot of people are reticent to give an upper range limit," he said.

"This is a situation that can cause buyers to lose sight of what is a fair price."

Mr Dunkley said, in a similar vein, some sellers were now changing their minds after entering the market and not even accepting their full asking price, believing they could get more.

"At these times, investors have to keep a cool head and stick to their guns or risk overpaying," he said.

WHAT TO DO

Mr Dunkley said investors who wanted to ensure they did not pay too much for a property needed to arm themselves with as much information as possible before making an offer.

"The secret to not overpaying is to locate comparative sales evidence and know exactly what alternatives are in the marketplace," he said

"Once buyers establish the true market worth of the property, they can make an offer knowing that if their bid is unsuccessful, then the 'winning' buyer has paid too much.

"In the past few weeks, more buyers have been following this success strategy - digging their heels in and refusing to overpay."

For more information, please contact
Mr Trevor Dunkley
Director
Property Wizards
trevor@propertywizards.com.au
Tel: (08) 9381 7450