Buyers snap up homes for $200,000 under asking price as ‘fear and mystery’ grips Aussie property
Buyers are reporting making ‘lowball’ offers and having some success. (Source: REA/Getty)
When George Cherchian attended an open home in Sydney’s west recently, he was on the look out for one thing. A key detail would indicate how much competition he would have in vying for the house.
He attended every inspection for the property prior to the scheduled auction date. And when he didn’t see it, the buyers agent knew he was in a good position.
“I went to every single open home, and what I look for there is essentially the same faces. So if I’m seeing your face at every open I go to for one particular property, it tells me that you are just as interested in it as my clients are, or as I am,” he told Yahoo Finance.
“But that wasn’t the case here, we didn’t have any sort of repeat faces.”
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In the end, he put an offer in ahead of the planned auction date. Despite it being considerably lower than the advertised asking price, the vendor ultimately accepted it.
On behalf of the buyer, he secured the Baulkham Hills property for $1.9 million, $200,000 below the $2.1 million asking price.
Cherchian explained that in this particular case the vendor was in a position “where they couldn’t really afford to defer the settlement” as they had to sell because they had committed to buying another property.
“Now that there are not as many buyers to contend with, there’s almost a bit of a window of opportunity for those who are able to make a decision,” he told Yahoo Finance.
Overall, he said many buyers in Sydney were showing increased “caution” during so much uncertainty. As a result, “the things that need to transact, they are transacting at a discount”.
It’s been years since buyers were perceived to have much leverage in most Aussie housing markets. (Source: Getty)
Auction clearance rates in Sydney and Melbourne dropped in March, with the most recent results from April showing a clearance rate of just 54 per cent in Sydney, according to Domain, about 10 per cent lower than at the same time last year.
Dwelling prices went backwards in Sydney and Melbourne in the March quarter this year, according to property data giant Cotality. Prices fell 0.6 per cent in Melbourne and 0.2 per cent in Sydney.
Meanwhile this week, ANZ cut its forecast for capital city property price growth to be below inflation in 2026 in the face of weak consumer confidence, rising interest rates and the Middle East war.
“There are still some who recognise that uncertainty can create opportunity. They’re asking whether this is a chance to secure better terms, and in some cases, it is,” Cherchian said.
NSW broker Nathan Linton who works further north of the city, told Yahoo Finance of a similar success story recently for one of his clients that he got approved in November but had been struggling for months to secure a property.
“I’m having clients that are having success buying at reasonable prices, probably because there’s less competition at the moment,” he said, pointing to a backdrop of “fear and mystery”.
“This particular client, we did a quick digital evaluation (on a desired property), and it was worth $1.4 million. And he’s gone in there, attended the auction, and they let it go for $1.21 million,” he told Yahoo.
“I think the good news story that people kind of like to hear sometimes is that there’s still opportunity. And maybe in a market where everyone’s scared, it’s a good time to be buying because you can have a bargain.”
Linton runs a subreddit called ‘Asked a Broker’ where he shared the recent anecdote and was met with similar stories from other Aussies.
“We just bought ours … for $300k under what it last sold for a few years ago!” one Melbourne buyer commented.
“We lowballed not expecting anything and were happy to walk away given all the uncertainty but they said yes. Definitely a lot of fear out there.”
Nathan Linton (left) and George Cherchian (right) say buyers can get lucky with a bargain at the moment. (Source: Supplied)
While rising interest rates crimp borrowing power, Linton also agreed the current conditions could help first home buyers with a big enough deposit.
The broker said rising interest rates will impact buyers a little differently depending on their profile. As an example, each standard increase of 0.25 per cent in the RBA’s official cash rate would mean:
A single person with an income of $100,000 and no dependents would see their borrowing capacity reduced by $12,000.
A married couple with one child and a household income of $200,000 would see their borrowing power reduced by about $25,000 for each interest rate hike.
The higher the borrowing amount the bigger the overall numerical impact, he noted, with most banks and brokers in the industry indicating the average home loan would see borrowing capacity reduced by $25,000 to $30,000 with each 0.25 interest rate increase.
