It's a happy new year for both buyers and sellers

As we move into this new year, the shift from a buyers' real estate market to a sellers' market is gaining momentum, as best illustrated by the number of exceptional property sales that our agents were able to conclude during the recent holiday period - and some even on Christmas Eve and New Year's Day!

In simple terms, this means that there are more active buyers in the market, that the amount of available inventory is declining, and that it is taking less time for homeowners who want to sell to achieve market-related prices.

This does not mean that it is a bad time to purchase real estate or that homebuyers are now at a disadvantage compared to sellers. In fact, the current market change is being fuelled by factors that are very much in favour of buyers, including lower inflation and interest rate cuts, which are putting more money back into consumers' pockets and enabling more people to acquire homes.

Many employees can also look forward to an above-inflation salary increase this year. This, combined with lower deposit requirements, will make it easier for prospective buyers to obtain home loans, even though the banks will continue applying strict credit qualification criteria.

In short, this is an excellent time to purchase a new home, as prices in most regions, except the Western Cape, are still growing very slowly. This presents both repeat buyers and first-time homeowners with opportunities to maximise their long-term benefits. Property values will start to grow faster as inventory shrinks further over the next few months, and a continued decline in residential building activity (see below) means that this process in the formal market is unlikely to be interrupted by the development of large numbers of new homes.

Prospective buyers may, though, want to change their approach somewhat in response to the new energy in the market and ensure that they are prepared to take decisive action to secure the homes they want. Getting pre-approved for a home loan is always a good idea, not only to show sellers that you're a serious buyer but to establish a clear idea of what you can comfortably afford, with some margin built in for changes in your financial situation.

But buyers also need to be ready now to quickly make realistic offers for properties they like, remove any contingencies that might wreck a deal, and be flexible in accommodating any special requests from sellers.

Meanwhile, those planning to invest in buy-to-let properties need to be strategic now and buy in areas with rising levels of economic activity and tenant demand, not necessarily in those areas with the highest rentals.

Most importantly, everyone currently active in the market needs to minimise their risk by always dealing with qualified and trustworthy property professionals, such as those working under the Chas Everitt brand.

Warm property regards

07 Jan 2025
Author Chas Everitt

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It's a happy new year for both buyers and sellers