What is COMO?

In recent years, the real estate market experienced Buyer F.O.M.O. (Fear Of Missing Out) due to a shortage of homes compared to the high demand from buyers. Now, we are transitioning into a more balanced market, with an equal number of buyers and sellers. However, with this balance comes increased expectations from buyers and banks that homes meet higher standards of finish and condition. This shift has led to longer times on the market, as buyers feel less pressure to rush their decisions and more time to find the "perfect" home. Additionally, the Total Cost of Ownership (TCO) has risen, alongside the cost of living, making both buyers and banks more price-sensitive.

Understanding Seller C.O.M.O. – Cost Of Missing Out

Seller C.O.M.O. occurs when homeowners cling to the optimistic property values they were given just a few months ago, which were based on a different market landscape with lower interest rates. Many sellers are now rejecting offers that align with the current market value, only to realize later that they may have missed out on a good deal. As the saying goes, ‘A bird in the hand is worth two in the bush.’ In today's market, buyers are not making lowball offers to offend; they are simply constrained by what their banks will allow them to borrow. The recent interest rate hikes have meant that more of their repayments are going toward interest, which reduces their borrowing capacity.

The silver lining is that there are still active buyers in the market, and open homes continue to attract interest. If the market were truly stagnant, open homes would be empty.

Is Seller C.O.M.O. Worth the Risk?

If you are considering selling your property, or are already on the market, it’s crucial to stay informed and open to advice. Before turning down a reasonable offer, consider whether the potential cost of missing out is worth it. Remember, you can't be a serious buyer until your own house is sold.

Ready to Sell? Contact Southern Star Realty NZ

Thinking of selling? Give Southern Star Realty a call to discuss how to achieve the best price for your home in this changing market.