With buyers and vendors struggling to find common ground, the market has hit a stalemate and balancing negotiations has become a required skill for agents to succeed.
According to the Real Estate Buyers Agents Association of Australia (REBAA), a disconnect between vendor expectations and buyer perceptions has created a stalemate across the property market.
REBAA president Melinda Jennison said the gap between what buyers would pay and what sellers hoped to achieve had created a clear divergence in expectations between the two parties.
“Many vendors are still anchored to peak prices from months prior to now, while buyers are responding to softening sentiment and shifting economic conditions,” Jennison said.
“When these two positions don’t move toward each other, negotiations often stall, and that’s exactly what we are seeing on the ground.”
Jennison said the stalemate between buyers and vendors was evident, even in markets experiencing strong levels of competition.
She said a discrepancy between data and reality had left many buyers confused about their standing in the market, even though it had in fact shifted in their favour if they understood how to negotiate.
“There is genuine scope for negotiation, and in some cases, meaningful price discounting when vendors are motivated to sell.”
“But those opportunities aren’t obvious unless you know local market dynamics, how to interpret the data, and how to negotiate successfully.”
While vendors and buyers often relied on median price data when considering whether to transact, Jennison said they needed to look more deeply and research relevant transactions.
“Median prices are a blunt instrument. They don’t capture the nuance of local demand, and they can swing dramatically depending on the mix of properties selling in any given period.”
She said that a sudden surge across a particular segment of the market, such as two-bedroom houses, would significantly shift a suburb’s median price, despite no material change in the value of properties of different types or sizes.
According to Jennison, buyers were unwilling to stretch beyond what they believed was fair value for a property, while vendors who needed to transact were recalibrating their expectations.
Additionally, she said that while discretionary sellers were simply stepping back from the market, every market had its own rhythm, and that failing to understand that was one of the biggest missed opportunities for buyers given the current conditions.
“Right now, the national narrative doesn’t match the local reality in many suburbs, which means that relying on headline data alone can often lead buyers astray.”
“The key is to identify genuine value in market conditions with less competition than a few months ago and with much more room to negotiate.”
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