Article Five: I don't know the right time to buy

publication date: Feb 9, 2009
 | 
author/source: Kate Faulkner
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Buyers' Property Problems Series
Article Five: I don't know the right time to buy

Buying at the right time is mostly relevant if you are a property investor intending to make money out of the property. Most people buy a home however, so they have a roof over their heads.

First Time Buyers and Cash Buyers
Often the best time to buy is actually when the market is quite 'depressed' and you hear about 'falling prices' everywhere. At this time there are usually some bargains to be had at auctions, via agents with desperate sellers and via housebuilders who need to sell properties to stay afloat.

Trading Up
It typically doesn't matter when you buy and sell as prices are always relative. If the market is rising, your own home increases as will the price of the next property you are buying. However, there is a slight quirk here, if the market is falling and you price your property sensibly you can often 'jump' a rung or two on the ladder if you find a home with a desperate seller. However you just need to be aware that you need to stay in the property for 5+ years to allow prices/economy to recover.

Trading Down
Ideally you'll want to sell and buy in a rising market as the property you buy rises at 10% will be less of an increase than the one you are selling at 10% more. However, most people who trade down have lived in the property for some years and gained high price growth. For example, despite the fact that property prices in 2008 fell by approximately 20%, prices over the previous 10 years had grown by 200%, so effectively as an owner, people were selling with a 180% or more profit as opposed to a '20% loss'.

For more information visit our buying a home section where you can download our Buying a Property eBook to help you decide when it's the right time to buy and refer to our buying a home services.
   

 



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