What is the property clock and how does it work?

Property clockThe property clock can help you determine the perfect time to buy and sell your investment.

Whether you’re a first home buyer or an experienced property investor, you’ll probably be aware of the importance of buying or selling at just the right time. Property markets in Australia and around through the world go through a cycle, and if you manage to time your purchase or sale just right it can make a difference of tens of thousands of dollars.

But how do you know where the market is in its cycle and whether or not it’s a good time to buy or sell? That’s where the property clock comes in.

Need a real estate agent? Start comparing your options

Provider Details Get in touch
OpenAgent

OpenAgent logo

  • Compare 30,000+ real estate agents
  • Find the right agent and maximise your results
  • Get a free property valuation
Go to siteMore info
Commingle

Logo for Commingle

  • Compare proposals from qualified professionals
  • Access over 45,000 real estate agents
  • Free property valuation profile
Enquire nowMore info
Conveyancing Logo

Fill in your details to get free real estate agent proposals with Commingle

Receive a free property valuation, compare agent commissions and fees and choose the best real estate agent for you with Commingle.

  • Save time and money finding the right agent to sell your property.
  • Commingle is a free service that can negotiate on your behalf to get the best deal.
  • All your details will remain confidential.

What is the property clock and how does it work?

The property clock is a useful method of tracking the property market cycle. It is based on the recognised stages of the property cycle: a “boom” followed by a downswing in prices, “bust” as the market hits the bottom of the cycle, and then a recovery period as the market builds towards the next boom.

property clockThis clearly-defined cycle can be expressed in the form of a clock. When the hour hand on the clock is at 12, the property market is in a boom period, demand is outpacing supply and prices are at their peak. As the hand moves down clockwise around the face, the market enters a downswing period and prices start to cool until, when the hand reaches 6, there is an oversupply of houses and the market bottoms out.

But then things start to turn around as the recovery period begins. Rental returns start to improve and interest rates fall, which means demand for housing increases and prices start to rise once again. This continues as the hand moves further around the clock face and up towards 12, the next boom period once again.

How to use the property clock

The property clock makes a nice graphic and is a useful illustration of market performance, but it also serves a practical purpose. By working out where a particular suburb sits on the clock, you can time the market just right to get the best value for money: that is, selling at the peak and buying when prices are at their lowest.

The property clock offers an extra degree of certainty and reliability when predicting which regions and suburbs are ripe for investment. It can help new investors gain a better understanding of the property market and the dependable cycle it follows. Once you have a better understanding of the different periods of market performance, you can examine patterns and market trends to establish exactly where a certain region sits on the property clock.

For example, let’s say you have worked out that a regional area of NSW is sitting at around 7 or 8 o’clock on the cycle. Now could be the perfect time to buy, as while prices are still fairly low, there is the potential for a substantial upswing in property values before the boom period occurs.

money on paper stocksOn the other hand, if a region sits at 12 o’clock on the property cycle clock, this is the worst time to buy, as prices are at their absolute peak. By using the property clock, you can work out the best times to buy and sell and develop a safe and successful property investment strategy.

Working out where a region sits on the property clock

Accurately calculating just what “time” it is on the property clock in a particular region can sometimes be easier said than done. That’s because there are several factors that affect the property market and while there are certainly well-established cycles in place, it’s rare that property prices will follow the exact path you predict.

Factors that influence the property market cycle can range from small local issues to developments on a global scale. For example, if the largest employer in a small town gets into financial difficulty and has to lay off a large portion of its workforce, you can expect the market to cool. On the other hand, if interest rates fall around the country, the more favourable borrowing conditions this leads to will cause increased housing demand that leads to a rise in prices.

You should also know the signs to look out for that may give you a better idea of what “time” it is. For example, rising prices and auction clearance rates of more than 50% could indicate a rising market, while properties regularly selling for higher than the asking price and only being listed for a very short period could indicate that the market is at its peak.

It’s quite easy to perform your own calculations and create your own version of the property clock. There’s a huge range of property market data available from providers like APM Monitors and RP Data, or even through listings websites like Domain and realestate.com.au, that you can use to tell the time.

Alternatively, you can also access regular property clock updates from Herron Todd White, Australia’s largest independent property valuation and advisory group. In the June 2016 property clock for residential houses, areas like Adelaide, Canberra and Cairns were classed as being rising markets while Perth and Alice Springs were declining.

MAn on computer paperLimitations of the property clock

While the property clock is undoubtedly a useful tool for home buyers and investors, it does have a few key limitations you should be aware of. It’s worth remembering that the property clock is basically used to predict the future, so there’s always a risk of unexpected economic or market developments producing a deviation in the property cycle.

The property clock can also cause some investors to take too much of a short-term view on property investing. With the obsession of timing the market just right, it can be easy to forget about the long-term benefits an investment property portfolio can generate.

Finally, it’s worth remembering that no matter what stage of the cycle the market is at, even during a downswing or a period of stagnation, it’s still possible to make money in real estate. You just need to know what you’re doing and where to invest your money.

Compare the latest investor mortgage rates

Rates last updated December 13th, 2018
$
Loan purpose
Offset account
Loan type
Repayment type
Your filter criteria do not match any product
Name Product Interest Rate (p.a.) Comp Rate^ (p.a.) Application Fee Ongoing Fees Max LVR Monthly Payment Short Description
3.99%
3.99%
$0
$0 p.a.
80%
Get a discounted, low-fee investor loan from a convenient online lender. 20% deposit required.
3.89%
4.24%
$0
$0 p.a.
80%
Fix your rate and minimise repayments for 2 years with this interest-only investor mortgage.
3.84%
3.91%
$0
$0 p.a.
80%
Get instant online approval and flexible repayment options with this fixed rate mortgage for investing.
3.94%
3.94%
$0
$0 p.a.
70%
Investors with a 30% deposit can get this low rate loan to fund their property portfolio. Take advantage of split and redraw facilities.
3.79%
3.82%
$0
$0 p.a.
80%
An essentials variable investor mortgage with a high borrowing amount so you can fund a large purchase.
3.99%
4.13%
$0
$10 monthly ($120 p.a.)
80%
A competitive variable rate home loan with no application fee.
3.98%
5.01%
$0
$395 p.a.
90%
Fix the rate on your investment property for 2 years with this competitive home loan package.
3.74%
3.79%
$499
$0 p.a.
80%
Competitive variable investor mortgage to fund your property portfolio. You can add a 100% offset account for just $10 a month.
4.05%
4.22%
$0
$10 monthly ($120 p.a.)
90%
Lock in your interest rate on your investment property for 2 years. Earn Velocity Frequent Flyer Points.
4.03%
3.92%
$499
$0 p.a.
80%
A competitive 3 year investor rate with principal and interest repayments. Optional offset account with a $10 monthly fee.
3.91%
3.92%
$0
$0 p.a.
80%
Investors can go from application to approval in as little as 20 minutes with this innovative online lender.
3.98%
3.98%
$0
$0 p.a.
70%
Investors can get a 100% offset account and a low rate if they have a big deposit. 100% online application process.
4.09%
4.87%
$0
$395 p.a.
90%
Buy your investment property and set your repayments for the first year. Available in QLD, NSW and ACT only.
3.99%
3.94%
$0
$0 p.a.
80%
Buy an investment property and enjoy the certainty of a 3-year fixed rate with interest-only payments.
4.09%
4.40%
$0
$0 p.a.
70%
Forget about rate rises for two years and minimise your investment repayments with this interest only mortgage. Requires a 30% deposit.
4.54%
4.59%
$600
$0 p.a.
80%
An investment loan for new Heritage Bank customers. Low fees and interest-only repayments.
3.97%
3.99%
$0
$0 p.a.
80%
Package your owner occupied loan with investment loan and receive a discounted investment rate. 100% offset account included.
4.29%
5.33%
$0
$395 p.a.
90%
Lock in a competitive investment rate and combine your loan with a credit card and transaction account for extra savings. Package fee applies.
3.99%
4.62%
$395
$0 p.a.
80%
Investors can enjoy flexible repayments and an easy application process with this pioneering online lender.
4.29%
4.31%
$0
$0 p.a.
80%
Investors will pay no application or ongoing fees for this interest-only loan.
4.18%
4.18%
$0
$0 p.a.
80%
Investors get a 100% offset account and pay no application or ongoing fees on this loan from an innovative online lender.
3.89%
3.91%
$0
$0 p.a.
80%
Investors can go from application to full approval in as little as 20 minutes with this innovative online lender.
4.29%
4.31%
$0
$0 p.a.
80%
A simple, variable rate investor loan from an online lender that keeps fees to a minimum.
3.99%
4.62%
$395
$0 p.a.
80%
Investors can enjoy flexible repayments and an easy application process with this pioneering online lender.
4.90%
4.31%
$0
$0 p.a.
80%
Lock in a fixed rate for 5 years and make interest-only payments with this investment loan.
4.24%
4.68%
$0
$0 p.a.
90%
Fix your investment repayments for 1 year. You can get this loan with a 10% deposit. Available in QLD, NSW and ACT only.
4.64%
5.39%
$0
$395 p.a.
90%
Pay off your investment knowing your exact repayments for the first 4 years. Get this loan with a 10% deposit.
3.99%
3.92%
$0
$0 p.a.
80%
A variable interest-only loan for investors. Fast application, low fees, optional offset account. 100% online lender.
4.29%
4.27%
$0
$198 p.a.
70%
Fund your property portfolio with this fixed rate mortgage which includes a 100% offset account. 30% deposit required.
3.89%
3.91%
$0
$0 p.a.
80%
Lock in your interest rate for 2 years and enjoy flexibility, an optional offset account and a fast online application process.

Compare up to 4 providers

Aussie Home Loans Logo

Enter your details below to receive an obligation-free quote from an Aussie home loans expert today

By submitting this form, you agree to the Finder Privacy and Cookies Policy and Terms of Use

Applications are subject to approval. Conditions, fees and charges apply. Please note that you need to be an Australian citizen or permanent resident to apply.

Credit services for Aussie Select, Aussie IQ and Aussie Optimizer products are provided by AHL Investments Pty Ltd ACN 105 265 861 Australian Credit Licence 246786 ("Aussie"), and its appointed credit representatives. Credit for Aussie Select products is provided by Residential Mortgage Group Pty Ltd ACN 152 378 133 Australian Credit Licence 414133 (“RMG”). RMG is a wholly-owned subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124 AFSL and Australian Credit Licence 234945. Credit for Aussie Optimizer products is provided by Perpetual Limited ABN 86 000 431 827 (Lender). Credit for Aussie IQ is provided by Macquarie Bank Limited ABN 46 008 583 542 AFSL and Australian Credit Licence 237502. Home loans issued by the Lender are serviced by Macquarie Securitisation Limited ABN 16 003 297 336, Australian Credit Licence 237863 (MSL).

Aussie is a trade mark of AHL Investments Pty Ltd. Aussie is a subsidiary of the Commonwealth Bank of Australia ABN 48 123 123 124. ©2018 AHL Investments Pty Ltd ABN 27 105 265 861 Australian Credit Licence 246786.

By submitting this form, you agree to the finder.com.au Privacy and Cookies Policy, Terms of Use, Disclaimer & Privacy Policy and the Aussie privacy policy.

Aussie Home Loans is both a lender and a mortgage broker, and offers a range of services.

  • FREE Suburb and Property Report with every appointment.
  • Access 3,000+ loans from over 20 lenders.
  • Get expert help with your loan application, including paperwork and eligibility.
  • Over 1000 brokers who are able to help you in your local area.

Aussie Home Loans Lender Logos

The Adviser’s number 1 placed mortgage broker 5 years running (2013-2017)

Pictures: Herron Todd White, Shutterstock.

Tim Falk

A freelance writer with a passion for the written word, Tim loves helping Australians find the right home loans and savings accounts. When he's not chained to a computer, Tim can usually be found exploring the great outdoors.

Was this content helpful to you? No  Yes

Related Posts

Ask an Expert

You are about to post a question on finder.com.au:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and Privacy & Cookies Policy.
Ask a question
Go to site