Time for best bargains?

So now that we know that things will slow down a bit or atleast this year is not going to be a repeat of last year, what's the best time to pick good bargains?

A friend of mine (a stock investor) thinks that best time for picking bargains is the moment market changes momentum because this is when most people try to jump ships fearing worse things if they delayed any further and generally are willing to sell at a discount a lot more than actual expected fall because they want to end uncertainty.

who else thinks we will start seeing good bargains in sydney market in next few days?

 

Cycle bottoms would typically take years to reach from the top, not a few days.

 

Property owners don't react like share traders. I doubt we'll see any big impact for the next 3 months. Owners and investors will hold properties as long as they are viable. Personally I will buy if I find the right one, not necessarily a discounted one.

 

Its not the same as the stock market because property is not as liquid and it can't be sold over night. Owner occupiers make up a fair chunk of the market as well. Sellers who don't need to sell won't, a change in market conditions would be resisted by vendors initially.
Best opportunities occur at the point be maximum pessimism, after several years of under performance and declining prices.
When no one else is buying or turning up to opens and property generally in an area is on the nose, going against the crowd takes a little foresight but this is when bargains are found easily.

 

+1

Agree in principle but don't you think anyone who's buying now will now want to buy 3 months later and everyone who intends to sell in next 12-18 months will try to sell now and this will result in properties accumulating on the market and prices going down.

 

I thought about this recently.

My theory being that some sellers who thought they were selling in a red hot market may have already purchased and therefore are forced sellers at a time when buyers are being cautious.

However, whilst you might snag a bargain now, that price then becomes a comparable sale and works against future sellers. If buyers continue being cautious then you would assume the price will continue to drift down.

There might be a handful of opportunities now but IMO there will be more in a few years. DO something else with your money in the meantime. Property and more specifically Sydney property is not the only place to make money.

 

The flow on effect due to APRA and interests will take a while unless interest jumps to 9% overnight and massive unemployment.

 

This is a bargain some lucky investor snapped up last weekend:
http://www.realestate.com.au/property-studio-nsw-randwick-120649849

Bank repossession sale - $361000
Spend 20k on renovation and not hard to find $500+ tenant in that year, giving 6% yield in a blue chip suburb!

 

It might be too soon.

I feel that we are now at 12 o'clock in Sydney...it will take about 18 months for bargains to come along....i don't think the market will move significantly for another 6-7 years. I wouldn't jump in just yet...it will take while for the specufester to adjust their expectations or panick sell. Watch for any more IR moves upwards..that will accelerate the decline quicker.

 

@larrylarry so you'll buy regardless the property clock / cycle you are in ?

 

Not yet.. If your friend stock investor, he may know "do not catch the failing knife."

Wait Perth 18-24 months from now and see...

Then take a look at Sydney

 

Have your mops ready for what were OTP apartments in western Sydney and south of the CBD due to settle in 18-24 months..

 

I agree somewhat with this, however I wouldn't be buying at the peak of a cycle in a particular city.. There is always good deals, it is the opportunity cost of buying elsewhere and the upside of getting in on a moving cycle elsewhere vs the slowing momentum of the bargin you found in that city plus any downside on market correction.

As Sash said, once we get an IR movement or two - then you will see deals pop up from those who have over leveraged, but you will still need to be on the ball to pick up a solid deal..

 

I'm not buying in Sydney but I'll still buy elsewhere if you know what I mean.

 

There are always good deals but not perfect deals. So I'm not waiting for a perfect deal that comes along. I'm looking outside Sydney Metro.

 

What you think is a bargain today will be a mistake tomorrow, because boom cycles have shorter time frames, bust cycles can go on for 7-10+ years, and prices can keep falling

MTR

 

@Steven Ryan fingers crossed mate for that. But still the over supply problem doesn't go away when you bought the apartment cheaper than before right ?

 

Yes, that's what I have learnt so far in this forum, hence I'm refraining myself in buying OTP this year especially in Sydney.

 

@larrylarry Yeah I've seen you've been active in the other thread mate ....

 

What's your strategy?