A cooling market can present great opportunities for savvy buyers—but not every deal is a bargain. In the rush to capitalise on falling prices, it’s easy to overlook red flags that could turn a “smart buy” into a regret waiting to happen. Whether it’s a questionable location, signs of structural issues, or shifting developer tactics, understanding when to walk away is just as important as knowing when to lean in.
Here’s how to recognise the danger signs and make sure you’re buying wisely—not desperately.
Too Good to Be True? It Probably Is
If a property seems significantly underpriced compared to similar homes in the same area, don’t assume you’ve found a hidden gem. There’s usually a reason behind the discount—often one that won’t be obvious from the photos.
It could be a nearby development that’s about to block natural light or ruin the view. Maybe it’s a home that’s been sitting on the market for months, quietly passed over by other buyers who spotted something you haven’t. Before you get excited about a “steal,” ask the selling agent pointed questions and consider ordering a building and pest inspection well before making an offer.
Stale Listings with Shifting Price Guides
In cooling markets, it’s not uncommon to see the same properties popping up again and again—first listed, then withdrawn, then re-listed with a different agent or price. Sellers can become anxious and adjust expectations, but if a property has had multiple failed campaigns, ask yourself why.
Is there a fundamental issue that’s putting buyers off? Has the vendor been unrealistic about price and conditions? A stale listing may not always be a red flag—but it deserves closer scrutiny.
Overly Eager Agents or Developers Offering “Bonuses”
When markets cool, pressure shifts to sellers—and some try to sweeten the deal with incentives like cashback offers, waived stamp duty, or free furniture packages. While these might sound attractive, they can also be a sign that the property isn’t selling for a reason.
These bonuses can distract from real issues like overpricing, poor construction quality, or oversupply in the area. Be especially cautious with off-the-plan sales offering “limited-time” deals or heavily marketed investment packages. Developers may be trying to shift stock before values fall further.
Strata Costs That Don’t Add Up
If you’re buying an apartment or townhouse, don’t just skim over the strata report—read it carefully. In some buildings, lower property prices are offset by sky-high ongoing costs that can sting your budget long after you’ve settled.
Be on the lookout for high quarterly levies, underfunded sinking funds, or a history of special levies for repairs. These are common in older complexes or buildings with recent structural issues. If the strata body hasn’t budgeted well or if there are repeated issues with defects or disputes, it may be time to look elsewhere.
Poor Rental Yields in Supposed “High Growth” Areas
Just because a suburb is marketed as a “rising star” doesn’t mean it’s the right place to buy. Some areas see rapid development and population growth, only to stall once supply outpaces demand.
Look at actual rental yields and vacancy rates rather than relying on projections. If advertised yields seem inconsistent with similar properties nearby—or if rental incentives seem excessive—it could be a sign that the area is under pressure. A good mortgage broker Sydney investors often work with can help assess how these factors may impact your serviceability and loan structure over time.
Ignoring Local Infrastructure Plans
Cooling markets often include outer suburban or semi-rural areas where prices appear attractive. But future infrastructure matters—a lot. A bargain-priced home may not stay that way if nearby roads are gridlocked, public transport is non-existent, or new developments flood the area with too many similar properties.
Check local council and state planning websites to understand what’s coming to the area. Are there planned schools, transport links, or zoning changes that might impact the property’s future value? If not, the short-term affordability may be offset by long-term limitations.
Pressure to Skip Due Diligence
In any market, but especially a softer one, be cautious of sellers or agents who urge you to act fast or skip standard checks. “Other buyers are interested” might be true—but it also might be a tactic. Never feel pressured to make an unconditional offer without completing your building and pest inspections, finance checks, or contract review.
If something feels rushed or off, it usually is. Don’t be afraid to slow down and do things properly—even if it means missing out.
Valuation Comes in Low—Don’t Ignore It
If your lender values the property below the agreed price, take it seriously. While it might feel like a temporary hiccup, it could be a genuine reflection of falling values in the area.
You can try negotiating with the vendor to reduce the price or appeal the valuation, but proceed with caution. A low valuation is a sign the bank is worried about resale value—and you should be too.
Final Word: You’re Allowed to Walk Away
Not every property is “the one.” In a cooling market, the power begins to shift toward the buyer—but that doesn’t mean every property is worth pursuing. If the numbers don’t stack up, the quality isn’t there, or the area lacks long-term potential, trust your gut and move on.
Walking away isn’t a failure. It’s a decision that keeps your options open for a better opportunity—and in markets like these, that next opportunity might be right around the corner.