The Seven Most Common Myths in Real Estate in 2025

Navigating the real estate market can be a daunting task, especially when myths and misconceptions can cloud your judgment. As potential buyers and investors it's crucial to separate fact from fiction in the property market. Our team at IPS, has identified seven myths that could mislead our potential clients as they embark on their property journey. Whether you're considering buying your first home, expanding your investment portfolio, or finding the perfect rental property, understanding the realities behind these myths can help you to take confident steps towards building your wealth through property. Join us as we debunk these common notions and explore strategic insights to help you achieve your real estate goals with clarity and assurance.

1. Myth: I Need to Buy at the Perfect Time

The idea of a "perfect time" to buy property is a persistent myth in real estate. Many believe they can strategically time their purchase to maximize benefits and minimize costs.

In reality, market timing is incredibly challenging, even for seasoned experts. Economic factors, local market conditions, and personal circumstances all play roles in determining the best time to buy.

Historical data shows that major price drops in the housing market are rare and typically short-lived. Even during significant economic events like the 2007-2009 financial crisis or the COVID-19 pandemic, price decreases were generally limited to around 6%.

Instead of trying to predict market trends, focus on your individual readiness. Consider factors like your financial stability, savings, and long-term housing needs. These personal elements often have a more significant impact on your success than market timing.

Remember, the "right" time to buy is when you're financially prepared and have found a property that meets your needs and budget.

2. Myth: Prices Double Every Decade

The belief that house prices double every ten years is a common misconception in real estate circles. While this may have occurred in some markets during certain periods, it's not a universal rule.

Property price growth varies significantly across different regions and time frames. Factors such as local economic conditions, infrastructure development, and population trends all influence price movements.

For example:

Sydney: Prices doubled in 10 years
Melbourne and Adelaide: Took 14 years to double

It's crucial to research specific markets and understand that past performance doesn't guarantee future results. Focus on long-term trends and local factors rather than relying on broad generalizations.

3. Myth: The Property Market is Volalite

Despite short-term fluctuations, the housing market has shown remarkable stability over extended periods. This resilience is due to several factors:

Strong population growth
Limited housing supply, especially in desirable urban areas
Government policies supporting homeownership

While prices may level out for periods, significant long-term declines are uncommon in most markets. This stability provides buyers with more time to make informed decisions without the pressure of rapidly changing prices.

Consider viewing property as a long-term investment rather than a short-term speculation opportunity. This perspective can help you make more balanced decisions based on your needs and financial situation.

4. Myth: Landlords are Greedy

Many tenants believe that rising rents are primarily due to landlord greed. However, the reality is more complex and involves broader market forces.

Rent increases are typically driven by:

Supply and demand imbalances
Overall market conditions
Operating costs for property owners

While some landlords may opportunistically raise rents, most are constrained by market rates. Overpricing can lead to extended vacancies, which are costly for property owners.

Understanding these factors can help tenants negotiate more effectively and make informed decisions about their housing options.

The primary driver of rent increases is the balance between available rental properties and the number of people seeking to rent. This balance is influenced by various factors:

Population growth and migration patterns
New housing construction rates
Economic conditions affecting homeownership rates

In areas with housing shortages or rapidly growing populations, rents tend to rise more quickly. Conversely, areas with ample new construction or declining populations may see stable or even decreasing rents.

For both tenants and investors, understanding these dynamics is crucial for making informed decisions about where to live or invest.

5. Myth: The Stock Market is better than the Property Market

When evaluating real estate against other investments like stocks, bonds, or cryptocurrencies, it's crucial to consider the leverage effect and total returns.

Example comparison:

Investment Type	Initial Investment	10% Growth	Return
Home ($500,000)	$100,000 (20% down)	$50,000	50%
Stocks	$100,000	$10,000	10%

Real estate often allows for greater returns on initial investment due to leverage. However, it's important to also consider:

Ongoing costs (maintenance, property taxes)
Liquidity differences
Diversification benefits

A balanced investment strategy may include a mix of real estate and other assets to optimize returns and manage risk.

6. Myth: Relying on Parental Assistance is Bad Thing

The "Bank of Mum and Dad" has become a significant factor in helping many first-time buyers enter the property market. While this support can be valuable, it's not the only path to homeownership.

Benefits of parental assistance:

Larger down payment
Potentially better loan terms
Earlier entry into the market

However, it's important to consider:

Impact on family relationships
Potential financial strain on parents
Developing financial independence

For those without access to parental support, there are alternative strategies and resources available to help achieve homeownership goals.

7. Myth: The Government doesn’t care about Home Owners

Government programs and incentives can significantly reduce barriers to homeownership for many buyers. These options are particularly valuable for those without access to family financial support.

Key government initiatives to consider:

First Home Owner Grants
Stamp duty concessions or exemptions
Low deposit schemes without mortgage insurance
Shared equity programs

Additionally, alternative strategies like "reinvesting" (renting where you live while owning an investment property elsewhere) or co-ownership with friends or family can provide paths to property ownership.

Research thoroughly and consult with financial advisors to understand which options best suit your situation. Remember, while these programs can help, it's crucial to ensure you're financially ready for the responsibilities of homeownership.