If you’re thinking about selling your home in the new year, you have probably been reading the headlines and wondering what your final result is going to look like.
Your local Professionals agent is the best port of call for an accurate valuation and prediction of your sale timeline but here are some factors that may influence it.
What will influence the 2025 property market?
Interest rates
After a series of rate hikes, the Reserve Bank of Australia’s (RBA) cash rate sits at 4.35%, where it has remained since late 2023. These increases were aimed at controlling inflation and they have impacted borrowing power for some people.
The ‘sting’ of higher rates is starting to be felt, with CoreLogic reporting that the national upswing in home values was just 0.1% in November.
However, you shouldn’t see this as reason not to sell your home. In a buyer’s market, you’ll become the buyer as soon as you sell and be able to take advantage of steady prices yourself. What’s more, if you purchased prior to the pandemic, it’s likely you still have achieved fantastic capital gains as growth across Australia jumped significantly in the early part of the 2020s.
Finally, economists are predicting that interest rates will drop in 2025. If you start preparing for a home sale at the start of the year, by the time you are ready, there may be a drop in rates.
Most major banks predict rate cuts in 2025, with forecasts of a 0.25% reduction as early as February. Some analysts anticipate more cautious timing, suggesting April for the first cut, followed by additional reductions throughout the year.
If these predictions hold true, borrowing capacity will increase, potentially boosting buyer demand. This could create more competition for properties, giving you the advantage again as the seller.
Lending buffers
Another factor to watch is the lending buffers mandated by the Australian Prudential Regulation Authority (APRA). These require banks to assess borrowers’ ability to repay loans at an interest rate 3% higher than their offered rate.
While this safeguard is aimed at preventing borrowers from defaulting on their mortgages, it has limited buyers’ borrowing capacity. While the latest update saw APRA stand by its buffer, there is growing pressure for it to be reduced. If this does happen, it will add to people’s borrowing power.
This is a watch for this space situation at the moment, but it could have an impact on your property sale if things change.
Your home, your market
While economic conditions and buying trends are worth keeping an eye on, the outcome of your home sale will come down to the way your home is presented and the people in the market.
To achieve a great result, you need to present a place buyers fall in love with that is clean, well-maintained and nicely styled. It will be worth investing in a deep clean, declutter and some key upgrades so yours is the house or apartment that people want to fight for.
You also need as many buyers through the door as possible. Your real estate agent will help with this, reaching out to their network to maximise interest and negotiate with interested parties.
There are always buyers out there, they just need to see why your home is right for them. If you’re thinking of selling in the new year, enlisting the help of a dedicated local operator will help you achieve a strong price that you’re happy with.
Is now the time to sell? Reach out at teresa@teresaberger.com.au today.
