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Prospective homebuyers might think they know all about the market, but new research has found many don’t.
IT may be a great Australian past time to talk about property, but new research has revealed many prospective buyers don’t know as much about the market as they may think.
The research by CommBank found one in two potential home buyers over-estimated what the median dwelling price was in their capital city.
And people in Sydney, which has undergone a period of rapid price growth in recent years, were the worst at picking prices.
More than half of Sydney buyers and close to half of Brisbane and Adelaide buyers were wrong about values.
Dan Huggins, executive general manager of Home Buying Commonwealth Bank, said many over-estimated what properties were worth and had a limited understanding of what they could borrow and afford.
Mr Huggins said many buyers don’t know what values were in the suburb they want to buy in.Source:Supplied
“Discussing the local property market is a national pastime but these results show that, even for those actively looking to buy a property, perception can be different to reality,’’ he said.
More than half of respondents didn’t feel confident they could find current property market price estimates or what their potential repayments could be, which Mr Huggins said were important things to know when looking for a property.
“It was interesting it showed that one in two homebuyers are over estimating the median dwelling of their capital city so their dreams of owning property may be a little closer than they think.’’
The research also found more than a third of respondents planned to buy a property in the next 12 months.
Melbourne had the highest number of intending buyers - 39 per cent.
Adelaide residents were the least motivated with only a fifth planning to buy in the next 12 months.
Mr Huggins said it could be difficult for prospective buyers to find the right information they needed to be fully informed when entering the market.
He said they had released a CommBank Property app to help buyers become fully informed about properties, values and what they could afford to borrow.
“It is obviously critically important they (prospective buyers) understand the local areas that they are looking to buy in, we think that they should also understand the upfront costs how much they can afford, their borrowing capacity, what their repayments are likely to be on any property to ensure that they can really afford that and over time really be able to afford the amount of money that are borrowing.’’