We live in one of the most expensive suburbs in Melbourne. Our rental was put on the market last June at $1.6M+. Auction in Sept was passed in with a vendors bid at $1.35M, no other bids. Finally sold privately today for $1.2M. So about 25% off in 6 months.

BTW absolute nightmare living in a rental once the owner puts on the market.

In the September 2008 quarter, the median house price for metropolitan Melbourne dropped by 3.3% to $435,000.

However.... more affluent areas had much higher drops, whilst the lower valued properties had a less than average drop, some probably even going up.

That 25% off, is only off the initial price that the vendor tried to get, possibly not its real value at any time ? Many sellers do put property on the market at a higher price, just in case they can find a "suitable" buyer

If the 3.3% quoted is from REIV I would take it with a pinch of salt. Wouldn't trust them at all.

House prices start falling, more people buy houses, fewer people availble to rent, more houses come on the market, prices fall even more, more people buy instead of renting, fewer people available to rent, more houses come on the market, prices fall... .. It is self-perpetuating.

Apologies for not reading back to check if it's been mentioned, but purely anecdotal evidence would suggest that, in Sydney, the higher end properties are going on the market and demand for around the 500k mark is increasing as people are having to downsize. Makes sense to me, but doesn't help me one bloody bit.

Coupled to an increasing population with insufficient housing being built, to house them all, and you get the status quo...

Maybe even increasing prices in some areas, where the houses are still affordable. eg: The Sydney suburbs where 3 bed houses on 800sm of land are still under $300k. (And where prices have actually started to climb slightly, after 4-5 years of dropping.)

Just to update those who don't know, UK now facing serious financial tsunami - an unbelievable 1 in 5 houses in the UK for sale are now forced sales, and this is before the bulk redundancies. We are already down 15% from peak, and this latest development will act as a massive downward force pushing prices down, I would say, a great deal more. I don't think Australia will face this level of wipe-out, but it would suggest things in Aussie could get much worse before they improve looking at how far behind the UK things in Australia are.

http://www.timesonline.co.uk/tol/mon...cle5202124.ece

I wish my house in Sydney was only 15% down from its peak !! But it is almost 20% down.

Sorry to hear that. 15% of course is just the average, some flats are down well over 50% yoy.

Yes, but the reason there was an undersupply of housing was because people bought investment properties. The biggest problem occured when the price rose to the point that the investors and the first home buyers were competing for the same properties, which drove up the price of even the lowest value properties. When these properties (especially the ones bought in the last two years) come back onto the market we may even see an oversupply of housing. My guess is that they need to be sold in the next six months or they be in negative equity for ten years.

Of course, I could be wrong. I'm keen to buy as soon as I get residency, but my head is telling me that the time to buy will be second half of next year.

60 mill in uk not enough housing to go round but prices dropping. In oz 21 mill population a lot of build land for sale plus a lot of unsold property, basicaly your house prices will plumet as there is not enough population for the amount of houses you have built.

Where is this land ?


Everyone is talking about too many people for the number of properties being built...

The Australian population is increasing faster than houses can be built.

Also Australia's population is growing almost 3 times as fast as the UK.

I agree with much of this. 1 in 5 houses in UK now forced sales, and this is before bulk redundancies. Imagine the percentage of forced sales when people start getting laid off - 35%? 50%? When this happens the crash will really start, and the average property in the UK could lose a serious amount. So much in fact I'm not even prepared to speculate any more, although I'm guessing that 15% off yoy will look like the Good Old Days. Aussie for me comes out of this better than the UK, but not much better. It has a ridiculous current account balance, almost as bad as the UK's:

https://www.cia.gov/library/publicat.../2187rank.html

Canada has more money in the bank, but has an enormous public debt of 64% of its GDP, even worse than the UK which is 43% of its GDP. Australia is well in the red, but has a national debt of only 15% of its GDP - one of the best in the world.

Also, you might like this:

http://uk.youtube.com/watch?v=jbgwR1pA1k0

[QUOTE=ABCDiamond;6998044]Where is this land ?
there is a hell of a lot of land around perth,mostly inland around 20klm especially SOR.The greedy developers rush and buy on the coast first,this inflated land also sets a benchmark to keep prices up everywhere.Rob druitt ( head of WA real estate) was banging on in the paper today how things will all be rosy in 2009.Perth house price's started dropping way before the october crash.I cant help thinking that the oz housing market is far more similar to the US than the uk is .Australia has far more avaliable building land than uk and they are dropping rapidly in the uk.So who do believe "booming prices next year" or " further drops" you decide

[QUOTE=Catch;6998718] Neither the UK or US are good examples for Australia, as both are crashing faster than a Bulgarian stunt plane at an airshow. As for the land issue, you should read the Demographia report which dismisses it as irrelevant, and balmes Australia's inflated prices very much on lending practices (like everywhere) and the restrictive planning laws (like the UK).