The hopes of property buyers, homeowners, and investors have been in the slumps lately as the market faces a downtrend, with major markets reporting dismal performances over the recent months.
However, industry watcher Aidan Devine said these market players seemed to have forgotten how the property cycle works. In a think piece on The Daily Telegraph, Devine said buyers are often fixated on short-term events when in fact, it was only last year when home prices were at their highest.
"They’d pay thousands more than they needed to thinking the prices they offered would be a bargain in a year’s time," he said.
Devine noted that with the current market trend, many would-be buyers are now unwilling to spend due to their assumption that prices might get cheaper in the next few months.
"The reality is that the market was never going to boom forever, but neither are we going to be stuck in a rut that stretches on indefinitely. Make no mistake: prices will go up again at some point. Then they’ll be another adjustment period of sluggish sales, followed by possibly another increase. That’s how the market has performed for nearly a century. Don’t count on that changing," he said.
The trick, Devine said, was not to think too much about recent headlines about market declines. For instance, while Sydney's home values were reported to have fallen by 5.4% for the past year, prices are actually still 50% higher than they were five years ago.
"If you’re selling a home, you may not get that killer price your neighbour got last year, but considering how much you likely paid for the property, you’ll still probably come out of your sale very well. A housing crash this is most certainly not," he said.
Collections: Mortgage News
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