Auction clearance rates are continuing to decline around the country, with rates significantly lower that the same time last year.
According to Australian Property Monitors, Sydney had a clearance rate of 49.8 percent last weekend, while Melbourne recorded 55.6 percent. For the same period last year, Sydney cleared 70.5 percent and Melbourne, 78 percent.
Brisbane’s clearance rate for the weekend was 47.1 percent, and Adelaide recorded 47.6 percent.
Meanwhile, the Australian Bureau of Statistics released housing finance figures today showing the number of home loans has risen 1.9 percent after 8 straight months of decline. The positive news was quickly offset by data showing that while there was more loans approved, the size of the loans shrank, suggesting buyers will have less money to spend in the market in coming months, putting downwards pressure on house prices.
Enzo Raimondo, President of the Real Estate Institute of Victoria says some vendors needed to adjust their asking price in line with market trends.
» Home auction rates hit lowest in a year – News Limited, 12th July 2010.
» Clearance rates fall under 50% in Sydney, as market cools – Sydney Morning Herald, 12th July 2010.
» Home loans on the rise – The Sydney Morning Herald, 12th June 2010.
The fall in price will start to show up in the next 2 or 3 weeks as vendoes begin to face up to the fact that they are holding a crap load of debt and the price they payed for the house is way over the top. Real Estate agents will do there best to start talking the price down to keep up turn over. Any more uping of interest rates and real fear will enter the market, then its going to correct around 15% to 20% fact is house prices in OZ are just way to high and time is running out to get out if you are holding too much debt.
But prices will continue to climb and climb?? Unlikely.
Especially with base utilities prices climbing 30% over the next 3 years.
I wonder how many of the First Home Buyers will cope with increased interest rates and utlities costs?
And why are the banks all of a sudden wanting 20% equity for First Home buyers and investors.. Are they scared of a 20% fall in the market? Would be the only reason why!
I couldn’t believe it when I was cleaning out my parents house.
I found an house appraisal from 1998 for their house saying the market value of only $185, 000.
If we assume a 3% inflation rate since 1998 to now (2010) then the inflation adjusted market value would be $264,000.
Instead it is “worth” between $600,000 to $700,000 based on recent sales in the neighbourhood.
It just highlighted to me how vastly overvalued property prices are
The number of properties listed on Real Estate Institute of Western Australia doubled in sixth month.
It will be interesting when sellers start trying to lower their asking price amongst each other
Even with a 20% drop on an average home is still disgustingly unaffordable for the average working bloke.
The question will be in 3-5 years time.. Where will all the cleaners, factory workers and other low skilled low paid people live?
On the street and parkbenches like they do in America