Property is all about timing the market. But waiting too long to purchase a property could end up costing you more in the long run. Here’s why.
Why would someone wait to purchase a property? Is there such a thing as ‘the right time’?
Waiting to buy a property is one of the most common moves for Australian homebuyers, particularly in NSW and the ACT.
It’s tempting to think you’re playing the market by holding off, waiting for prices to drop in Sydney’s eastern suburbs or hoping for a dip in Canberra’s rising housing costs.
You tell yourself the wait will be worth it, that prices will stabilise or even fall, and that the Reserve Bank will announce a much-anticipated rate cut.
But here’s the uncomfortable truth: timing the market is an illusion. Housing markets, especially in sought-after regions, rarely play by the rules you’d expect.
While you wait, property prices creep higher, inflation chips away at the value of your savings, and you find yourself slipping further from your goals.
That perfect moment to buy? It doesn’t exist.
What does exist are tangible, long-term costs for sitting on the sidelines.
Time is money: Why waiting could cost you
Delaying a property purchase may feel like a cautious move, but it’s often the most expensive mistake you can make.
Property markets in NSW and ACT, despite their periodic corrections, have a long history of rising, or at least, defying expectations.
Miss a year or two, and you’ll find yourself chasing a higher price tag on the same home you once dismissed as too expensive.
Take Sydney as an example. CoreLogic data shows that the city’s median house prices climbed dramatically during 2020 and 2021, increasing by over 30%.
Imagine sitting out the market during that period, waiting for prices to cool off. By the time they did, not only would you have missed out on the chance to build equity, but you’d also be re-entering a market at a significantly higher cost.
There’s also the question of inflation, meaning your deposit loses value over time. And then there’s the cost of paying someone else’s mortgage as you rent in the meantime, waiting for rate cuts that may never come.
Here’s what waiting could really cost you.
By the numbers: what waiting even a year could cost you
Let’s crunch the numbers, based on average data from the Australian Bureau of Statistics on a modest property outside of Sydney.
Say you’re looking at a home priced at $728,000, which is the current median house price in New South Wales outside of Sydney.
You’ve managed to save a solid 20% deposit, which means no lender mortgage insurance - great start! You’re also offered a variable interest rate of 6.1%, which is about average right now. Source: Australian Bureau of Statistics
But you’ve heard whispers about possible rate cuts coming in 2025. You’re not alone!
Some have said as recently as October 2024 that rates could be cut by as much as 1% by December 2025 . That might tempt you to wait so you can bag cheaper repayments when you buy. Source: Big 4 bank analyst notes
On the surface, it sounds like a smart move, right? But waiting could cost you more than you realise.
You might be interested in: Will interest rates drop in 2025?
Crunching the cost of waiting
First, let’s talk about the property price itself.
NSW property prices, even outside the Sydney market, have historically been unpredictable. But even by conservative measurements, prices have grown by an average of 6% per year. Source: Australian Bureau of Statistics
If you wait 12 months, that $728,000 home isn’t going to sit at that price: it’ll rise to around $771,680 by the time you’re ready to buy.
That’s an increase of $43,680 in just one year. That’s equity you could have had in your pocket, working for you!
The cost of living in the meantime
Plus, if you’re renting while you wait, you’re not just standing still—you’re paying someone else’s mortgage.
Let’s say you’re spending $2,500 a month on rent, which is fairly typical in NSW. Over the year, that’s $30,000 gone.
So, between the missed capital gain of $43,680 and the rent you’re forking out, your decision to wait has cost you a whopping $73,680. Source: Australian Bureau of Statistics
And that doesn’t even include inflation’s impact on your deposit savings, which lose value as the months tick by.
‘But what about the rate cuts’, I hear you ask?
Now, let’s address the big hope on the horizon: that 1% rate cut. Yes, lower interest rates might mean slightly reduced repayments in the future, but here’s the problem—you’re gambling on something that isn’t guaranteed.
The Reserve Bank of Australia has already started hosing down rate cut rumours, with February 2025 no longer looking likely due to concerns around inflation and global instability. Source: Big 4 bank analyst notes
The U.S. election results and proposed inflationary policies could send ripple effects across the global economy, potentially delaying any rate changes here in Australia.
And let’s not forget escalating tensions in Europe and the Middle East, which could influence financial markets in ways no one can predict yet.
These are just the factors we know about, who knows what else could happen between now and then?
Why you should get into the property market when you can
Too many buyers hold out for the perfect property in the perfect suburb, thinking that their first purchase needs to be the one they’ll own for life.
This mindset only delays progress and increases the likelihood that rising prices will outpace your savings.
Instead, you’re better to focus on what’s achievable now.
Entry-level homes, apartments, or properties in emerging suburbs may not tick every box on your wishlist, but they allow you to get into the market.
Once you’re in, the growth on that property’s value becomes part of your financial portfolio. It’s leverage for your future moves.
What is rentvesting, and why should you consider it over waiting to buy?
Rentvesting is also worth considering instead of waiting.
This approach allows you to buy where you can afford while continuing to live where you want.
You get the best of both worlds: the lifestyle you value and the financial security that comes from owning property. Over time, rental income can help offset your mortgage while you build equity.
Government incentives can also make a huge difference. Schemes like the First Home Owner Grant or stamp duty concessions aren’t just government marketing buzz—they’re genuine opportunities to lower the barriers to entry.
Don’t underestimate how much these programs can help reduce your upfront costs and fast-track your property journey.
To wait or not to wait? The bottom line
The most important thing to know is that the housing market doesn’t wait for anyone.
As you deliberate, hand-wring and wait, property prices rise, inflation eats into your deposit, and the market dynamics shift in ways you can’t predict.
Every year or even month you delay is one of missed opportunity to build equity and secure your financial future.
Instead of chasing a moment that may never come, consider acting now.
Even if you aren’t quite close to that 20% deposit number, our mortgage brokers can help you to get over the line and into a property, without costly delay.
