blog.buysellrealestate.com.au

Everyone’s talking about the drop in property values, and some are wondering if we might be heading for a meltdown like they’ve experienced in the USA. The circumstances over in America are very different to those here in Australia, as The Age’s Kenneth Davidson points out in house-prices-are-a-bubble-waiting-to-burst-20080730-3ncu.html”>“House prices are a bubble waiting to burst”:

“The loans that financed these homes were allocated by agents who didn’t care that their clients were NINJAs (no income, no job, no assets), or the housing was in jobless ghettos without public transport, because the loans were bundled and on-sold.”
- house-prices-are-a-bubble-waiting-to-burst-20080730-3ncu.html?page=2″ target=”_self”>Kenneth Davidson, The Age

So although the drop in real estate values will probably not be as significant as it has across America, prices are expected to drop. Australian Property Monitors are talking about a 10% fall, whilst Residex CEO John Edwards says we’re heading for a house-price-meltdown-fear-20080731-3o0b.html” target=”_self”>“once-in-100-years real estate slump”. Then there’s RP Data, who are saying that predictions of a 10% drop were “sensationalist” and “next to impossible”. Sorry RP Data, but suburbs across Brisbane have already dropped by 10%, so maybe it’s not that impossible. Yes, RP Data could be talking about the likelihood of a city-wide drop in value, and the stats suggest that hasn’t happened yet, but perhaps it’s just a matter of time.

Are we heading towards a house price meltdown?  In my opinion, no. We are looking at a correction of the market, which has become overvalued, and that may see prices drop in the order of 10 or  20 per cent, and that number will be higher if there is one more interest rate rise. However, I doubt things will be anything too massive, unless Australia goes into a nationwide recession that impacts upon every industry.

Hassell Architects has won the design competition for St Hilliers Property’s proposed A-grade commercial building development in Parramatta, New South Wales.

Building permits issued in Victoria for the 2007-2008 financial year have surpassed the $20 billion barrier for the first time, according to the Building Commission’s pulse 2008 statistics.

Property prices are starting to drop ever so slightly across Australia, so the question worth asking is: how will a real estate price slump affect you?

house-prices-set-to-slide-in-capital-cities-20080731-3o02.html” target=”_self”>This video from Fairfax Media includes a brief interview with Victorian Executive Director for HIA, Robert Harding. He provides his view on a number of issues, including:

• How will this affect people who have just bought?
• How can owners minimise the affect of a fall in property value?
• Is it a good time to buy?