When it comes to getting a Police Bank home loan, you’ll be wondering how much you might need to actually borrow. This all comes down to knowing what sort of home you’re after and in what kind of suburb. From here, you can get a feel for housing prices and an understanding of the sort of price range you could be looking at.
One way to do this is to observe auction results. While this can be useful, auction prices should be taken with a grain of salt, however. A November 30 report by CoreLogic RP Data made some interesting comparisons between sales made through private treaty and by auction.
In most regions, auctions tend to reflect activity in the premium end of the property market. Hence, in the 12 months to September, the median prices of homes that went under the hammer were consistently higher than those that sold through private treaty. Furthermore, auctions only accounted for a small fraction of property sales (less than 5 per cent in several regions), showing that it’s not necessarily the clearest indicator on the local market’s entire scope.
If you’re after a NSW home loan, however, the situation is a little different in Sydney than in other capital cities, bar Melbourne and, to a lesser extent, Canberra. In the Harbour City, auctions respectively made up 30.7 per cent and 21 per cent of house and units sales. With this in mind, what sort of prices were Sydney homes selling for under the hammer?
The CoreLogic report revealed that the median auction price for Sydney houses were $1,260,000.
Does this mean you’re going to need a million-dollar Police Bank loan just to secure four walls and a roof in Australia’s hottest real estate market? Not exactly.
Buying through private treaty
While auctions do occupy a larger portion of sales in the city, the majority still clearly go through private treaty. Note that the mentioned median auction price was quite a bit greater than the $1,017,540 house value seen in CoreLogic’s October monthly indices. This means that auctions could indeed be more weighted toward the pricier side of Sydney’s property spectrum.
Furthermore, results also show that, like in other cities, there is a disparity in prices between these two sales methods. The median sale price for houses that sold through private treaty were $700,000 – a difference of more than half a million dollars on auctioned properties!
This is a sign that it’s entirely possible to find plenty of housing below the million-dollar mark, though it might mean spending more attention on homes sold privately rather than under the hammer.
If you’re after financing for a house in New South Wales, speak with Police Bank. We’ll ensure you get a hold of the right home loan for your needs.