Half of Australia’s potential homebuyers are overestimating property prices in their capital city, according to a new survey by the Commonwealth Bank.
The survey revealed a tendency among homeowners to overvalue their properties, especially those who hailed from Sydney (57%), Brisbane (49%) and Adelaide (47%).
“Discussing the local property market is a national pastime but these results show that, even for those actively looking to buy a property, perception can be different to reality. Home buyers need to do their research so they can enter the market with confidence,” said CommBank’s executive GM of home buying Dan Huggins.
“Our research found more than half of respondents didn’t feel confident they could find current property market price estimates or what their potential repayments could be, which are important things to know when looking for a property.”
The research suggests more could be done to close the knowledge gap for homebuyers when it came to understanding their borrowing power, interest rates, mortgage repayments and stamp duty.
Gen Y made up the least confident age group with only 29% describing themselves as “reasonably confident” in their knowledge of the Australian property market.
The research data coincides with the release of a new property app by CommBank.
“We know people use a variety of resources to inform their purchasing decisions such as websites, real estate agents and their friends and family,” said Huggins.
“Fortunately our app allows buyers to gain an estimated market value price, along with a clear snapshot of what their upfront costs might look like and their repayments.”