The buying & selling in the same market myth.

You often hear it said that you can’t go wrong buying and selling in the same market. But is this true? If you think about it, it can only be true if you are buying and selling in the same price bracket and the same suburb.

Of course you can’t always be in control of the timing when it comes to your need for a home. But in reality, there are a couple of “ideal” principles when buying and selling.

1. Upgrade in a falling market. As prices fall, the gap between the price of your old smaller home and your new larger home will narrow. In a rising market, the gap widens – and you have to fund this gap.

2. Downgrade in a rising market. Likewise, the gap between the price of your redundant family home and your new empty nest will narrow in a falling market – so to maximize your retirement funds you want to buy and sell when your large home is worth its maximum.

It is rare to actually manage a simultaneous transaction – there is usually some lag between the sale and purchase. Be careful that you don’t get caught out in a volatile market. For instance if you buy when the market is rising and the market falls overnight (such as what happened with the GFC in September 2008), then you get caught when you go to sell. Of course, this can work in your favour if the opposite occurs. Riding the property wave is truly a fine art… with more than a bit of luck mixed in.

For more information on buying property in Sydney go to www.gooddeeds.com.au.

Units versus townhouses – which is best to buy?

In some areas you can find townhouses and units selling for similar prices. Assuming all things are equal (size and dollar wise), I would nearly always err towards the townhouse.

There are less of them around and the complexes are often smaller, so capital growth will probably be better. In addition, a townhouse usually has more outdoor space than a unit. Often the strata levies are considerably lower as smaller complexes generally have less common areas and no expensive facilities like pools and gyms.

Of course, if it is a view you are after, you have a better chance of finding one in a multi-story apartment complex than a townhouse.

For more information on buying property in Sydney go to www.gooddeeds.com.au.