Melbourne Stock Shortage - COVID Strategy

Hi all,

I'm still on the hunt for my PPOR. Some properties before the second lockdown were going $50-80k more than asking price and my own valuations. My theory why people were going well over the price is the same as to why people were buying toilet paper - without logic nor patience.

So there is a great deal of discussion on the boards at the moment in relation to the stock shortages in the market. I'm also thinking that people overspent considering the economic downturns and continued pessimism.

What are your thoughts on generating stock by contacting agents in the area, asking them if they had any purchases during peak values where they think the owners might be concerned or overleveraged for what was secure for them at the time, who might want to be looking for an out?

Agents obviously have stock issues and may lean on past purchasers to evaluate if they need an exit strategy?

 

Every vendor wants to get as much as possible for their property. Just as every buyer wants a bargain.

If properties are selling for more than “you” think they are worth, you may have to reassess the accuracy of your personal idea of fair value.

 

You dont think agents are doing that already?

If the vendor isnt motivated enough to contact an agent, they are not desperate (or realistic). Either way, you wont get the bargain you are looking for.

 

Not sure why you feel the need for "you" to believe that I have to reassess my idea of fair value when it sold for $128k more than the bottom of their asking price range (was $680k-$730k) and their next-door neighbour sold theirs for $690k 9 months earlier.

Fair point. Many thanks for the perspective.

 

Experience suggests that newbies who are looking for a bargain and think prices are above their valuations..... usually end up buying nothing and missing out when prices eventually go up.

 

or just buying something out of frustration (sick of looking and constantly missing out) that doesn't suit their needs and suffer in the longer term with poor growth. Market is generally pretty efficient, For Unique PPOR 2 buyers interested good price, 3 buyers great price etc. As individuals we like to think we all have unique taste but the reality is different

 

Nine months can be a long time between fair valuation, and can result in huge differences, both higher and lower.