Negotiating House Prices: How a Mortgage Broker Can Help
Is the thought of Australian house prices keeping you awake at night? You’re not the only one. A growing number of buyers are expressing concern about housing affordability. Despite this, many still struggle with the idea of haggling over house prices. According to a 2023 survey by Domain, almost 70% of Aussie homebuyers confessed that they found negotiating on price to be one of the most difficult parts of buying a home.
However, a failure to negotiate on price could result in you paying more than you should. So, what can you do? Start by talking to a mortgage broker.
Why Talk to a Broker About Current Australian House Prices?
Why should you talk to a broker about property prices? Because they’re experts in the industry and they understand how recent market changes have affected property values. For example, according to CoreLogic, the median house price in 2014 was around $480,000. Fast forward to 2023, and prices had increased by 33%. In Brisbane, during the same period, the average price of a house went up by over 60%.
On top of that, we’ve had a pandemic (which impacted lending criteria and the availability of government grants), significant interest rate rises and a Royal Commission into the Financial Services Industry. All of these have changed the way lenders assess borrowing capacity.
How a Broker Can Help You Determine Property Value
So, what does this all have to do with negotiating the price of a house? Well, in the current competitive market, it is impossible to negotiate effectively without first understanding true property value. This isn’t what you think the property is worth or how much someone else is willing to pay. It’s the value placed on the property by the lender.
The value of a property will be determined by its location, size, condition and features, as well as by other recent sales of similar properties nearby. A real estate agent may attempt to elevate the perceived value of a property to increase the value of an offer. However, a lender will not approve a loan for more than the house is truly worth. This is where the input of a mortgage broker can become incredibly helpful.
How a Broker Can Help You Negotiate House Prices
A mortgage broker can help with the negotiating process in several different ways, including:
- Market Insights: Brokers have in-depth knowledge of the local property market and can provide you with data on recent sales and market trends. This kind of information will enable you to make an informed offer.
- Property Valuation Expertise: Brokers can access online property valuations so you will have a better understanding of the property’s worth. This together with your own investigations and knowledge of recent sales in the area you are looking in will put you in a stronger position when it comes to negotiating on price.
- Financial Guidance: A broker can help you to accurately determine your borrowing capacity and help you to secure loan pre-approval. This will show that you are a serious buyer with a set budget in mind.
- Negotiation Skills: Brokers often have working relationships with local industry experts, including real estate agents. This may help in discussions to let them know your position (only if you agree to this) and assist with presenting better terms on your behalf.
Ask North Brisbane Home Loans for Help Negotiating House Prices
Negotiating house prices may seem daunting, but with the help of a mortgage broker, you can succeed. At North Brisbane Home Loans, our brokers can help you secure a great price on your dream home thanks to our market insights, property valuation expertise and strong negotiation skills. Don’t let uncertainty hold you back – contact us today and let us help you secure the perfect price for your new home.
Patrick Cranshaw, a Certified Mortgage Professional for over 21 years, founded North Brisbane Home Loans in 2002. His career began with ANZ Bank in New Zealand, where he progressed over 16 years to a Business Banking role in Virginia. After moving to Brisbane in 2000, Patrick led the QLD market for a home loan agency, helped set up the REMAX Real Estate Finance division, and practiced as a broker.
