Rates, Real Estate & the Run to Christmas: What Perth Sellers Should Expect

As we head into the spring selling season, there is one question sitting in the background for both buyers and sellers: what happens next with interest rates?

Spring has traditionally been one of the busiest periods in real estate. More homes come to market, gardens look their best and buyers who have been waiting through winter often become more active.

But this year, I think the lead-up to Christmas may be influenced just as much by interest rate decisions and buyer confidence as it is by the warmer weather.

If rates hold

If interest rates remain steady through spring, I expect we could see a welcome period of stability for buyers.

One thing I notice regularly as an agent is that buyers don’t necessarily need everything to be perfect..they simply want some certainty.

When people have confidence around their borrowing capacity and repayments, they are generally more comfortable making decisions. They know their budget, they know what they can afford, and they can start planning their next move with greater confidence.

For sellers, that could mean a healthy spring market with motivated buyers continuing to compete for the right homes. However, buyers are becoming more considered. We are beginning to see more choice come onto the market, which means presentation, pricing and the way a property is positioned against its competition will become increasingly important.

What if rates rise?

Another rate rise would undoubtedly cause some buyers to reassess.

For some, borrowing capacity may reduce. Others may simply become more cautious and adjust the price bracket they’re searching in. However, I don’t believe that necessarily means buyers disappear. People still move for all sorts of reasons that have very little to do with interest rates. Families grow, children leave home, people retire, relationships change, and homeowners decide they simply want something different.

What may change is how buyers behave. We could see greater price sensitivity, longer decision-making and more negotiation between buyers and sellers. That makes realistic pricing particularly important. In a more cautious market, buyers have a tendency to compare everything — and a home that feels noticeably overpriced can quickly be overlooked.

Then we have the Christmas factor

The closer we get to Christmas, the more interesting the market can become.

There are always buyers who want to secure a home and have their plans in place before the new year. Families may want certainty before school returns, while downsizers and retirees may simply want their move completed rather than carrying it into another year.

At the same time, some prospective sellers begin saying, “We’ll just wait until after Christmas.” If rates remain stable and buyer confidence holds, that reduction in new stock later in the year could create a particularly interesting window for sellers who remain on the market.

If rates rise, the properties that perform best are likely to be those that are well presented, appropriately priced and give buyers a compelling reason to act.

Should you sell before Christmas?

My answer is probably less exciting than simply saying “yes” — it depends. It depends on your property, your price range, the amount of competition in your suburb and, importantly, what you plan to do after you sell.

For homeowners who have been in their property for many years and are considering downsizing, the bigger question may actually be what happens after the sale. Can you find the property you want? Do you need a longer settlement? Would selling first put you in a stronger position to buy? Those conversations are just as important as discussing the potential sale price!

Spring should bring more property to market and more opportunities for buyers. But as we move towards Christmas, I suspect confidence and certainty will be the two factors to watch most closely.

If rates hold, we may see buyers become increasingly comfortable making their move.

If rates rise, buyers are unlikely to vanish; but they may become considerably more selective.

And in either market, good preparation, realistic expectations and the right strategy will matter.

Disclaimer

This article contains general information only and should not be relied upon as legal or financial advice. Requirements may vary depending on your individual circumstances, and independent professional advice should be sought where appropriate.

Do you have a question about your home? Contact me laurenm@daveyre.com.au

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