Buyers haven’t gone anywhere, their budgets have.

Open homes across Cairns are still busy. What has changed since the latest rate rise is how much buyers can borrow, and how much choice they have.

By Ray Murphy, Director, Ray White Cairns

If you’ve been to an open home in Cairns lately, you’ll know the buyers are still out there.
Across our offices, open homes are averaging between 2.65 and 2.85 groups per inspection. That has held steady through the latest Reserve Bank rate rise, and in recent weeks it has ticked up.

So this market isn’t short of people or short of buyers. It’s short of borrowing power.
Every rate rise trims what a buyer can borrow. A family that was pre-approved for a certain amount a few months ago may now have noticeably less to work with. They still want to buy. They’re just shopping at a lower price point, and they’re watching recent comparable sales closely before they commit.

At the same time, there are more homes on the market. Buyers have more options, so they can afford to be patient and particular. The homes that sell are the ones priced to match what buyers can pay today, not what the market would have paid six months ago.

For sellers, that changes the strategy.

The temptation in a shifting market is to test a high price and make small reductions over time. In practice, that usually means chasing the market down. Sellers who get ahead of the curve, by pricing realistically from day one or choosing a method that creates competition, tend to achieve a better result than those who follow it slowly.

Method matters more than ever right now. Recent data shows a property has around a 16 per cent chance of selling within three months by private treaty. Take the same property to auction and that chance rises to around 45 per cent.
Auctions work because they bring buyers together on one day, set a clear deadline, and let the market decide the price in the open. In a market where buyers have plenty of choice, that sense of urgency is what moves them from interested to committed.

If you’re thinking of selling, a few things are worth doing:
• Ask for real numbers: open home attendance, buyer feedback and comparable sales.
• Choose a clear strategy, either a realistic price or an auction, rather than something in between.
• Make sure you get regular written updates through the campaign, so you can make decisions on evidence rather than hope.
No one can control interest rates or how much buyers can borrow. What sellers can control is their price, their method and how quickly they respond to what the market is telling them.

The buyers are there. The sellers who meet them where they are will be the ones who sell.