As buyer's agents, we are witnessing a noteworthy trend in our local real estate market over the past couple of months: an increasing number of properties are selling for prices below their listed guide. Additionally, guides are being lowered online numerous times before a property finally sells.

This phenomenon, relatively rare in past years, is becoming more commonplace, prompting both buyers and sellers to rethink their strategies. We believe it is likely to last for the foreseeable future until rates start to decrease or the cost of living softens.

What’s important to understand is that this shift is not happening in isolation. It reflects broader changes in buyer behaviour, affordability, and overall market confidence. When properties consistently transact below their guide, it is usually a sign that expectations have not yet caught up with current market conditions.

Let’s explore the factors contributing to this shift and what it means for the current landscape of property transactions.

Understanding the Shift

Market correction

After a period of rapid price growth, the market is undergoing a necessary correction. Many buyers who are struggling with affordability in various areas, including their desired purchase, are sitting on the sidelines, leading to less competition for properties.

During the previous growth cycle, strong demand meant buyers were often willing to stretch beyond recent comparable sales in order to secure a property. That behaviour has changed. Buyers are now far more cautious and are placing greater emphasis on value.

Sellers may be finding it harder to attract offers at or above their initial expectations, leading to lower sale prices. In many cases, the original guide is set based on past results rather than current conditions, which creates a gap between expectation and reality.

As that gap becomes clearer during a campaign, guides are adjusted and final sale prices often settle below where the property was initially positioned.

Interest rates

The stagnation of interest rates at higher levels has had a significant impact on buyer sentiment. Higher borrowing costs, combined with the broader cost of living, mean affordability becomes a primary concern and people are willing to pay less overall for property.

Even buyers with strong financial positions are reassessing what they are comfortable spending. Borrowing capacity may still exist, but willingness to stretch has reduced.

This has a direct impact on price outcomes. When buyers collectively adjust their limits, it places downward pressure on what properties are ultimately able to achieve.

It also means that price guides which were realistic six to twelve months ago may no longer reflect what buyers are prepared to pay today.

Increased stock levels

A surge in available listings in the last month has led to greater competition among sellers. With more choices available, buyers are exercising patience, which can drive down prices for properties that might not meet their criteria.

When stock levels are low, buyers are forced to compete more aggressively. When stock levels increase, that pressure eases. Buyers can compare more options, take more time, and avoid overcommitting.

This shift in supply and demand dynamics can result in properties being sold below their original guide price, particularly if they are not positioned well in terms of price, presentation, or location.

In some cases, sellers are effectively competing with each other, rather than buyers competing for a single property.

What This Means for Buyers

For buyers, this trend presents unique opportunities.

With many properties selling below the initial guide, buyers may find more negotiating power and potentially secure a better outcome. Properties that may have previously felt out of reach are now becoming more accessible, particularly where sellers are adjusting expectations throughout a campaign.

It’s an advantageous time to consider making offers on properties that might have been priced higher initially but have not attracted the level of interest the seller expected.

However, buyers should remain vigilant and do their due diligence. Just because a property is listed at a lower price does not automatically make it a good opportunity.

The focus should always be on buying the right property for the right price in the current market conditions.

It is also important to recognise that not all properties are affected equally. Well presented, well located, and realistically priced properties are still performing strongly. The opportunities tend to exist where there is a mismatch between expectation and value.

Engaging a knowledgeable buyer’s agent can help you focus on quality assets rather than simply chasing what appears to be a discount. The goal is not to buy cheaply, but to buy well.

What This Means for Sellers

Sellers must adapt to this changing environment.

Setting realistic expectations is crucial. Properties should be priced based on current market conditions rather than past trends. Relying on results from a different market cycle can lead to overpricing and extended time on market.

Do not engage a sales agent simply because they promise a higher price than others. This is a common trap, particularly in a softer market, where vendors are naturally drawn to the most optimistic appraisal.

Instead, monitor the market yourself as you approach your window for sale. Ask for appraisals to be supported by comparable sales data, and ensure you are engaging an agent based on their process, strategy, and track record, not just their pricing expectations.

A well priced property is more likely to attract strong early interest, which can create competition and lead to a better outcome overall.

Holding out for a price that the market is not supporting often results in the opposite outcome, with longer time on market and increased pressure to adjust expectations later in the campaign.

A More Balanced Market

While this trend may initially seem concerning, it is important to view it in the context of a broader market shift.

Properties selling below their guide price can indicate a move towards a more balanced and sustainable market. Rather than buyers being forced to stretch beyond their limits, transactions are beginning to align more closely with true market value.

This creates a healthier environment over time, where both buyers and sellers operate with clearer expectations.

Final Thoughts

As buyer’s agents, we see the landscape shifting in real time. Properties selling below their guide price may initially raise questions, but they are often a reflection of changing market conditions rather than a sign of weakness.

For buyers, this presents an opportunity to act with greater confidence, provided decisions are grounded in research and strategy.

For sellers, it is a clear signal to align expectations with the current market and approach the selling process with flexibility.

Navigating this evolving market requires a strong understanding of these trends and the ability to adapt accordingly.

Whether you’re buying or selling, being informed, prepared, and realistic will be key to achieving the best possible outcome in this changing real estate environment.

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