can anyone please tell us is the credit crunch hitting australia yet.we are looking to move in feb2009 but are house is loseing money all the time and is going to prove difficult to sell,are house prices dropping in oz if they are this means we can drop the price of our house and hopefully it will sell,
many thanks dean and sharon
I can't answer regarding oz prices but our house here has been up for sale since May, we have now dropped 25k less than we originally asked and we still don't have an offer.
Are you in a position that you could potentially leave your house for 2 years because that's when they are expecting uk prices to rise (my friend is an estate agent/mortgage advisor).
We bought a small unit 3months ago and now if we put it back up for sale we would lose 5-10k thats without fees
Last edited by chippie74; 11-08-2008 at 12:18 PM.
:)Although iam not a market expert the Adelaide market is not quite as straight forward as that, each suburb performs on its own and one seems a to go up and the next suburb slows or goes down, reports in the papers seem to indicate that overall the market is slowing down alot which helps you guys out , but on the other hand some suburbs are still slowly on the increase .cheers Graham
I know that twelve months ago, where I live in Aldinga Beach, mainly because it's so far out, you could buy a nice three/four bed house for $250,000. Now they're more like $350 - $400,000. Everyone wants to live by the beach! (Well, who wouldn't?) Seaford has seen a big increase too, because of the new estates there. I read the local property pages every week, and despair of ever being able to buy! I know it won't be popular with the people who've already bought, but I say, bring on the credit crunch in Oz - houses here were reported as being 30% overvalued, so that's what some market analysts are predicting the prices will have to fall by.
If the credit crunch were to hit Australia in the same manner as the UK then it could be a double edged sword. Not long before I left the UK yes the housing market had died and in many areas prices had fallen significantly. However, there were widespread reports of those who couldn't get onto the housing market because of price levels before the credit crunch not being able to get on to the housing market because they could no longer get mortgages after the credit crunch. It even got to the point where people had had an offer accepted based on a pre approved mortgage only to find that the mortgage product was suddenly removed by the bank. In some cases some institutions were removing entire product ranges.
Originally Posted by Deb17
My own view is that many of the factors seen in the UK are or will be seen here (i.e. housing market slowing, inflation up, interest rates not following central bank rate movements etc.). However, I don't believe that they will be seen to the same extent as in the UK. The economies are very different and as far as I can see the banks are not exposed to the US sub-prime market to the same extent as in the UK.
Also when looking at the impact over here you have to remember that things are very much more localised. For example the latest inflation figures for Australia as a whole are about 4.2% but for South Australia it is 4.5%. A lot of the growth factors that are expected to drive the South Australian economy are not overly linked to the ups and downs of short term economic cycles eg the long term defence contracts and capital projects in the mining and resources sectors.
I am still of the opinion that whilst house prices may cool there will always be areas that will increase and areas that will fall. General sweeping statements can be misleading and it all depends on where in particular you are looking to move.
We are currently looking at properties and some of these properties have been reduced and the owners will accept offers. The one property had been reduced by 20,000 and they where still willing to accept offers.
Speaking to the local bank and estate agents, americas debts have already hit aus and hence it is having an effect on properties prices. Also some young people are having to sell there properties in Aus because they can not afford a morgage.
I do not think the effect will be to the same degree as seen in England but it will definately affect house prices etc.
Last edited by lynne; 12-08-2008 at 12:27 PM.
Interest rates on mortgages will likely be coming down soon (next month or two). This is likely to stimulate the property market. The benefits of recent tax cuts are also only just coming through and will add to disposable incomes. Oz is in good financial shape in my view, SA in particular. We just had a good run of growth and the market has eased. However, it's not in freefall as far as I can see and is unlikely to go that way. Having said that, I don't there is great risk of substantial upward pressure on prices either. Probably more a case of slow and steady.