Everyone was holding back
From the day after the election, buyers have come out in force. Multi offers have returned as confidence rises, where first home buyers are keenly wanting to own a home and those who have one are trying to move to a more suitable one.
The multi offers tell a story. It is not unusual for the spread of offers to be over $200,000 or more with an equally small cluster at the bottom price level as at the top level. In most cases the seller is pleasantly surprised by the result.
There are buyers who have been saving and staying out of the market as they watched it fall over the last couple of years, and now some have cautiously dipped their toes in, making an offer, over the last two or three months. The resulting buyer spectrum includes those who don’t appreciate the extent of change in the market and come in with their first and low offer, through to those who have missed out a couple of times, been given a reality check and make a stronger offer hoping to get ahead of the market before it rises much more.
We have moved from a market where sellers followed the market down, dropping their price until it was so compelling that someone finally bought it, to a market where buyers are following the market up. The buyer is no longer calling all the shots. Previously they could make an offer full of conditions, now the seller more often has choice, and the cleaner offers get the best chance, often even taking out those with a higher price. Sellers want certainty, they want to get on with their plans rather than risk taking more money with more conditions and a longer wait for their sale to confirm.
Six months ago, a buyer could make an offer subject to the sale of their home and have a good chance of it being accepted. This has changed and we are seeing an increasing number of homeowners selling before they shop for their next home, then they find it and make a clean offer, often a cash offer that beats the other offers, even though sometimes it is a lower price. Right now, cash talks.
