What is the best time to buy a property?

A lot of people ask me what the best time is to buy a property? When are we expecting the lowest prices in the property market? Should I buy it now or postpone it to the end of this year or next year? The simple answer is nobody knows and if somebody pretends to know the answer, they are explaining their forecast.

 I try to answer this question in a different way. Here are some facts:

• After 2 years when house prices increased 31%, the current property market is cooling down from 2.5% to 7.5%, but nobody knows when the prices are stable or increasing again.
• The price is impacted by a lot of urgent political and financial decisions by the government which may change market direction a year before an election. 
• The price you may hear from the media is the mean (average) of all sold property in the last 3 or 6 months.
  
  • This data is based on 3 ~ 6 months ago information. When you decide to act based on them then the price has been started increasing 6 months ago. If you hear in media May 2022 price is dropping this is due CCCFA impact in December 2021.
  • The data is based on the whole of New Zealand or a city. It doesn’t reflect the specific property or suburb in the market. As an example, while property prices in Auckland Northshore increasing maybe prices drop in west Auckland and this offsets each other in mean price.
  • The date is based on all types of property. It doesn’t show the price per house, townhouse, or apartment. As an example, while house prices increase maybe apartment prices drop due to border closure.
  • The mean data accuracy relays on the number of sales. Then if the number of sales drop (which happens in a downturn) the accuracy may be not reliable.
• You buy one property, not the whole property market. In the stock market, your stock is the same price and same value as others and it depends on company performance to grow but in property, If you buy the right property (under market value and potential of adding value) you are always a winner in a downturn or rising market.
• Buy the property when the bank lends you money. If a bank lends you money, they calculate and consider most of the risks.
• You need to think maybe in the middle of the downturn (recession) when house price is lowest, you lose your job as same as others then you cannot get a mortgage from a bank.
• and finally even if you bought the property 10% above its value in the next 10~12 years when its value double (100% increase) then your 10% extra payment will be covered.

 Then my advices are:

• Buy property whenever a bank lends you money.
• When a bank lends you money then buy the right property.

Finally, you need advisors to help you maximize your lending, find you the right property and coach you during the process. Contact me if you don’t have anyone.