Current buyers looking for new homes are likely to be owner-occupiers, not investors, who want a standalone property rather than an apartment.
That’s according to Stephen Timm, the managing director of Home-In, a digital buyer concierge service.
Mr Timm said spring selling season had definitely hit, with the number of new buyers starting their due diligence onsite, and having contracts checked, jumping 15 per cent last week.
And he said the overwhelming majority of buyers were owner-occupiers.
“Our ratio of owner-occupiers has definitely risen,” Mr Timm said.
“About 18 months ago our ratio of owner-occupiers was sitting at 75 per cent and now it’s at 81 per cent.
“Six per cent doesn’t sound like a big shift necessarily, but it is quite significant when owner-occupiers have gone up six per cent and investors have gone down, so it’s a 12 per cent swing.
“I think the industry average is 30 per cent investors, 70 per cent owner-occupiers, so for us to be seeing 81 per cent owner-occupiers, that’s quite a high number.”
As for the reason behind the swing, Mr Timm said rising rents was a key factor for both sides of the equation.
He said rising rents were pushing buyers to purchase a home for the long-term, but while rents had increased, for investors the yields had not necessarily kept up with previous interest rate rises.
Uncertainty over rental regulations and policy was also creating caution.
“There has been a lot of talk about things like rent caps and other changes, which means investors are more likely to sit on the sidelines,” Mr Timm said.
Mr Timm also said buyers, including first-home buyers, were looking to purchase standalone houses more so than attached units or apartments that they’d then have to trade up from in a few years.
More listings have also recently come to market and Mr Timm said this, combined with interest rates holding steady for three consecutive months had created some more confidence in the market.
But he said buyers would not be in a rush to purchase a property like they were during the pandemic.
“There’s definitely more stock coming onto the market now and buyers are preparing themselves because they see more opportunities,” he said.
“But buyers now want to be more considered in their purchase, and make sure they’re doing their due diligence.”
Mr Timm said this meant agents would need to focus on servicing their buyers to a high standard as the ‘fear of missing out’ had dissipated.
“Agents need to really nurture those buyers that are putting in the effort on the property because they may well be the end buyers,” he said.