Selling Your Home in 2024: 5 Rules to Help You Get Ahead

In the later half of 2024, the Australian housing market is expected to undergo significant changes, with one-third of Australians anticipated to sell, buy, or refinance their homes.

However, they will face a market that has transformed dramatically from the previous year, and will continue to evolve.

The slowdown that began in the winter of 2023, fuelled by rising inflation and mortgage rates, brought an end to the red-hot pandemic housing market. As potential buyers withdrew, homes took longer to sell, and the remaining buyers gained more leverage.

For home sellers in the later half of 2024, this shift in the market dynamics means adapting to new realities. With borrowing costs higher than they've been in several years, buyers are seeking bargains and have more time to shop around.

Soon, gone are the days of bidding wars driving up prices; instead, sellers should expect to negotiate and potentially offer concessions.If your home requires some work, be prepared to assist with the costs or consider a slight reduction in your list price. This flexibility can make your property more attractive to buyers who are cautious about taking on significant renovation expenses.

Despite these challenges, there are still strategies for sellers to achieve a successful sale in late 2024's buyer's market.

5 rules for selling your home in 2024

1. Spend wisely to fix up your home

In the Australian real estate market of 2024, where buyers are expected to have more leverage, it's crucial for home sellers to spend wisely on renovations and improvements. While a well-presented and updated home can command a premium price, extensive renovations may not always be the best approach. Instead, focus on repairs and enhancements that will help your home compete with comparable properties in your area, ensuring that the investment you make will be recouped through the sale price.

1. Prioritise Cost-Effective Improvements: Make every dollar count by prioritising low-cost but noticeable repairs and improvements that can provide a good return on investment. This is especially important in the 2024 market, which is expected to favor buyers.
2. Consider Your Time Frame: Evaluate the time frame you have before you plan to sell. If you have ample time, you can tackle more extensive projects yourself to save money. However, if you're working with a shorter timeline, focus on quick and impactful updates.
3. Enhance Curb Appeal: First impressions are crucial, so invest in landscaping, exterior painting, and decluttering the outdoor areas. A well-maintained and visually appealing exterior can significantly boost your home's appeal.
4. Deep Clean and Declutter: A thorough deep clean and decluttering of your entire home can make a significant difference in its presentation. Remove personal items, organize storage spaces, and ensure every room is spotless.
5. Address Minor Repairs: Attend to minor repairs such as leaky faucets, stuck windows or doors, and worn carpeting or flooring. These small fixes can make a big impact on a buyer's perception of your home's condition.
6. Consider Kitchen and Bathroom Updates: If your home's condition warrants more significant renovations, focus on updating the kitchen and bathrooms, as these areas tend to have the highest return on investment.
7. Tackle DIY Projects: If you have the skills and time, consider tackling some projects yourself, such as painting or minor repairs. Every dollar you save on labor can be put towards other improvements or used as a closing credit to attract buyers.
8. Offer Incentives: In a buyer's market, offering incentives such as a closing credit or including appliances or furniture in the sale can make your property more attractive to potential buyers.

Remember, the key is to spend wisely and focus on improvements that will help your home stand out in the competitive 2024 market. By making strategic investments and presenting your home in its best light, you can increase your chances of a successful sale and maximize your return on investment.

2. Manage your finances wisely

As an Australian homeowner planning to sell and potentially buy another property in 2024, it's crucial to manage your cash flow and credit responsibly. Be cautious about taking on unnecessary debt without a reasonable certainty of eventual payoff.

When it comes to financing repairs and improvements, consider the following options:

‍Home Equity Loan or Line of Credit: If you have an existing home equity line of credit (HELOC), this could be a viable approach. However, if you're planning to sell in 2024, taking out a new HELOC or cash-out refinance may not be advisable, as you may not recover the costs before the sale.

‍Cash Reserves: If you have sufficient cash on hand, this may be the best option. However, be mindful not to deplete your savings excessively, as you'll need funds for the next property purchase and associated expenses.

‍Contractor Financing: Some contractors may be willing to accept a down payment and defer the remaining balance until after your home sells. While this option typically comes with a premium, it could be worth considering if it aligns with your cash flow situation.

It's also essential to maintain a good credit score throughout the process. Avoid taking on new debt or making significant purchases that could negatively impact your credit rating, as this could affect your ability to secure favourable financing for your next home purchase.

Remember, the key is to strike a balance between investing in necessary improvements to enhance your home's appeal and maintaining a solid financial position. By managing your cash flow and credit responsibly, you'll be better prepared to navigate the 2024 Australian real estate market successfully.

3. Line up good contractors early

In the Australian real estate market, timing can be crucial when it comes to securing reliable contractors for home improvements or renovations. As you prepare to sell your home in 2024, consider lining up contractors early to take advantage of their availability and potentially secure better deals.

During the cooler months, many contractors experience a slower period, making it an opportune time to compare quotes and negotiate favourable rates. Even if you're planning to sell later in 2024, consider having the work done now to get ahead of the curve and ensure your home is in top condition when it hits the market.

Additionally, consult with an experienced local real estate agent who has a network of trusted contractors and vendors. Their expertise can help you maximise your renovation dollars and ensure that the improvements you make will yield the best return on investment.

The good news is that many contractors in Australia will be eager to secure work during the quieter winter months, potentially leading to more competitive pricing and better availability. By acting early, you can avoid the rush and ensure that your home is ready to impress potential buyers when the market picks up in the warmer months.

Furthermore, securing contractors early allows you to plan and coordinate the work more efficiently, minimising disruptions and ensuring a smoother overall process. This can be particularly beneficial if you're planning to live in the home while the renovations are underway.

4. Don't wait to find a good realtor

As an Australian homeowner planning to sell in 2024, it's advisable to start your search for a reliable real estate agent well in advance. You don't have to wait until you're ready to list your property to engage with agents. With the market expected to favour buyers in 2024, many agents may experience a slower period, making them more available and eager to assist you.

Don't hesitate to reach out to multiple agents and discuss your plans. They can provide valuable insights into the improvements that will yield the best return on investment, recommend trusted contractors, and advise you on how to best position your property in your local market.

Additionally, many agents may be willing to offer reduced commission rates, especially if they have the opportunity to earn your business for both the sale of your current home and the purchase of your next property. This can be a mutually beneficial arrangement for both parties.

5. Manage your expectations: Price your home to sell, not sit

One of the biggest mistakes Australian home sellers make is overpricing their properties. It's often challenging for sellers to have an unbiased view of their home's true value, especially when emotional attachments are involved.

As the market slowed in 2023, many sellers chose to take their homes off the market rather than adjust their pricing expectations. This has resulted in a low supply of homes for sale but relatively few buyers. However, with potential drops in mortgage rates and more seller concessions, more buyers could re-enter the market in 2024.

As a seller in 2024, it's crucial to manage your expectations and price your home realistically to attract potential buyers. Work closely with your real estate agent to conduct a comprehensive comparative market analysis (CMA) of your property. This analysis will take into account recent sales of similar homes in your area, as well as current market conditions, to determine an appropriate listing price.

A well-researched CMA and a home in prime selling condition will be your best defence against overpricing. It's important to remember that home price appreciation in Australia is expected to slow down in 2024 compared to previous years. While some markets may experience slight declines from their mid-2023 highs, being realistic about your home's value and pricing it competitively can increase the chances of a successful sale.

Overpricing your home can lead to a prolonged listing period, which can ultimately work against you in a buyer's market. Be prepared to negotiate and consider offering incentives or concessions to attract motivated buyers.

By pricing your home realistically from the outset, you'll be better positioned to generate interest and potentially receive multiple offers, increasing your chances of achieving the best possible sale price in the 2024 Australian real estate market.

Options for older homes that need extensive repairs

Older homes in Australia can present unique challenges, so sellers might need to consider different approaches when listing these properties.

Sell it "As-Is" to Regular Buyers or Investors

Sometimes, it makes sense to sell your older property "as-is." Your situation and time frame may lead you to this option. A good real estate agent can prepare a comprehensive comparative market analysis (CMA) for you during the listing appointment. The agent will also advise you on negotiating inspection contingencies and issues that may arise from them.

Even in the current market, you can still receive a good offer for an "as-is" property. Investors are always on the lookout for properties in need of repairs, as they can fix them up and potentially flip them for a profit. Additionally, buyers who may be priced out of other homes could be interested in your fixer-upper.

Consider a Renovation Loan

If the home requires significant repairs or renovations, you may want to explore the option of a renovation loan. These loans, offered by various Australian lenders, allow you to borrow funds for both the purchase and the cost of renovations, with the renovated value of the property used as collateral.

According to Canstar, renovation loans can be a viable option for older homes that need extensive work, as they provide the necessary funds to bring the property up to modern standards, potentially increasing its value and appeal to buyers.

What if You're Selling and Buying?

If you're planning to sell your current home and purchase a new one, there are a few strategies to consider:

1. Manage Your Debt and Credit Score: As a prospective buyer, it's crucial to maintain a healthy credit score and debt-to-income ratio. Lenders will scrutinise these factors closely when assessing your loan application. Consider paying down any outstanding debts, such as credit cards, to improve your financial position.
2. Leverage Your Real Estate Agent's Network: If you plan to use the same agent for both the sale and purchase, engage them early in the process. They can start scouting for potential properties that meet your needs, potentially even arranging an off-market deal. This can give you a competitive edge in the market.
3. Explore Rate Buy-Downs and Longer Rate Locks: With mortgage rates in Australia expected to fluctuate, consider options like rate buy-downs and longer rate locks. Rate buy-downs allow you to pay an upfront fee to secure a lower interest rate, potentially saving you money over the life of the loan. Longer rate locks, on the other hand, provide you with more time to shop for a new home without worrying about rate increases affecting your borrowing power.

Remember, navigating the Australian real estate market as both a seller and a buyer can be complex. Working closely with experienced professionals and exploring all available options can help you achieve your goals while minimising potential risks and costs.