What to expect in the property market over Christmas holidays
For the savvy investor there are festive season fluctuations in the property market that can help buyer and sellers alike secure a prosperous real estate deal.
There is typically a mad rush leading into Christmas, with buyers and sellers wanting to secure a deal before Santa arrives.
It is a very different story between unwrapping the presents and celebrating New Year’s Eve.
This is typically a very quiet time, with real estate agents and other professionals in the industry taking a break while the market slows down until well into the New Year.
For the savvy investor there are multiple factors unique to the festive season that can contribute to securing a propitious property price.
So, what happens to the property market over the festive season?
Property market leading into Christmas
The lead up to Christmas is one of the busiest times of the year for real estate.
It seems sellers really want to have their property sold by Christmas and a new home is on many buyers’ Christmas wish lists.
Sellers often don’t want to risk waiting for the new year to sell their property, as there will be more properties (and competition) entering the market.
At the same time, the buyers are often preoccupied with planning holidays and Christmas festivities as well as tightening their budgets, so that also impacts activity in the market.
If you are looking to buy this is a great time, as vendors become increasingly nervous and desperate to sell their property before the shutdown period and subsequently become more flexible with price and contract terms.
Selling property over the holidays
There are some difficulties selling a property leading up to and just after Christmas, as well as the uncertainty around pressures on buyers as they become distracted with pre-Christmas festivities and planning their holiday period.
Sellers don’t want their properties sitting idle at this time of year because when the markets resume more normal activity in the New Year, their property’s days-on-market will appear significantly longer, creating the impression there must be something wrong it compared to suburb averages.
Sellers also don’t want to sit through the New Year not knowing how long they will be living in this property.
It can feel like they have had to hold onto their property for another year due to the calendar ticking over. Sometimes it’s just a mental game!
Buying property over the holidays
Conversely, the period leading up to Christmas and New Year can create some unique investment opportunities and be incorporated into a clever purchase strategy for investors who plan to stay active in the market.
The biggest advantage for buyers is the eagerness for sellers to finalise a deal before the end of the year. Sellers do not want their property sitting on the market during the shutdown period, so this creates an urgency for sellers to offload.
Investors can seize a bargain with less competition, as other buyers may be wary about managing and organising finances during this time.
Keep in mind that solicitors, brokers and banks will also be busy with a high influx of applications and clients pushing to settle before Christmas.
These professionals may also close their offices during the Christmas and New Year period, which can cause delays in exchange and settlement.
What happens in the New Year?
With all the celebratory distractions out of the way, the property market often rebounds in the New Year as buyers flood the market in January and February.
This creates more competition if you are a buyer, making it more difficult to negotiate on price.
Typically, we will see new sellers enter the market, increasing supply and options for buyers.
Whether you are buying a home or looking for an investment, keep in mind that the property markets are run by supply and demand and that will vary depending on the location.