Melbourne house prices plunge 8.4pc in a single quarter

Written by admin on April 26, 2008 – 7:13 pm

After hearing Real Estate agents and Property Investors for years say, House prices only go up – the opposite has happened :

Rising interest rates have had a significant impact on Melbourne’s property prices in the past three months.

The median house price dropped 8.4 per cent – the biggest quarterly drop since 1993. The average house price has decreased by $40,000 since December.

» Average Melbourne house price down 8.4pc – Yahoo News, 26th April 2008.

MELBOURNE’S property prices have plunged 8.4 per cent, or a record $40,000, since the start of the year.

Official figures show the median house price for the March quarter was $432,500, down from $472,250 for the previous three months.

» Interest rate rises behind record property drop – The Melbourne Herald Sun, 26th April 2008.

» Urban house prices fall – The Australian, 26th April 2008.


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Inflation shock to test interest rates

Written by admin on April 24, 2008 – 6:27 am

INFLATION has leapt to a 16-year high and is accelerating towards 5 per cent, raising the chance of further interest rate increases.

The Reserve Bank of Australia was braced for a bad inflation figure, but the 4.2 per cent jump in the headline figure for the year to March surpassed its worst fears.

» Inflation drives dollar to 24-yr high – The Australian – 23rd April 2008.

» Inflation shock to test interest rates – The Australian – 24th April 2008.


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US : Good chance that residential property prices will fall further than those sustained during the Great Depression

Written by admin on April 23, 2008 – 6:23 am

ROBERT Shiller, the Yale University economics professor who accurately predicted the top of the internet boom, said today there is a good chance that residential property prices will fall further than those sustained during the Great Depression, when home values fell by 30 per cent.

» US home-price fall may double: Shiller – The Australian, 23rd April 2008


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20% of homes at risk as stress takes toll

Written by admin on April 22, 2008 – 6:48 am

NOT only is mortgage stress on the rise, but up to one in five stressed households will lose their homes, according to analysis of mortgage stress data. As well, borrowers who refinance are more than twice as likely to ultimately lose their houses.

The findings are contained in Anatomy Of Australian Mortgage Stress, a report to be released on Thursday by Fujitsu Consulting.

» Homes at risk as stress takes toll – The Sydney Morning Herald, April 22nd 2008.


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How to plan for a fiasco

Written by admin on April 22, 2008 – 6:27 am

FOR more than 50 years the average Australian was able to buy their first home on the average wage. Traditionally, the median house price was about three times the median household income. Today, in Adelaide, Melbourne and Brisbane, the median house price is more than six times the median income; in Sydney and Perth, it is more than eight times.

» How to plan for a fiasco – The Australian, 22nd April 2008.


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NZ: Unit’s value plunges 83pc

Written by admin on April 20, 2008 – 7:29 pm

An Auckland couple lost 83 per cent of their investment when they sold a property in one of the city’s best urban precincts.

As the gloss goes off the Auckland housing market, the Mt Albert pair, who paid $349,000 three years ago for a Beaumont Quarter apartment, have sold it for $58,600.

Oouch.

» Unit’s value plunges 83pc – NZ Herald, April 19th 2008


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UK : House prices fall at fastest rate since 1978

Written by admin on April 17, 2008 – 9:46 pm

In October 2006, we reported US house prices were plunging at the fastest rate in 36 years.

Now it’s the UK’s turn.

House prices are falling at their fastest rate since records began 30 years ago as the mortgage lending freeze continues to undermine the housing market, the Royal Institution of Chartered Surveyors says today.

In a big blow to the government, which claims Britain is well-placed to withstand the global economic downturn, the RICS paints a bleak picture, in which the number of estate agents saying house prices rose, rather than fell, has dropped to the lowest point since the survey began in 1978.

» House prices fall at fastest rate since 1978 – The Guardian, 17th April 2008.


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How house lust turned it all to dust

Written by admin on April 14, 2008 – 6:56 am

NOW THAT the season of finger-pointing over the home-loan crisis is in full swing, it’s a good time to take a look at how “house lust”, as author Daniel McGinn calls it, affected the property market.

. . .

Home equity fell to about 48 per cent of total household real-estate holdings in the fourth quarter of 2007, the lowest level since the Federal Reserve started records in 1951

» How house lust turned it all to dust – Sydney Morning Herald, 12th April 2008


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Perth housing falls 3 per cent; 17,600 houses for sale, up 240% on 5,000 listings 18 months ago

Written by admin on April 12, 2008 – 5:11 pm

Page 6 of Today’s Australian Financial Report states :

House prices in Perth has suffered their biggest quarterly fall in almost a decade, in what analysis say could be a sign of things to come in other cities as rising interest rates and the falling stock market take their toll.

Preliminary data released by the Real Estate Institute of of Western Australia (REIWA) show the median Perth house price dropped 2.7 per cent to $457,000 in the March quarter in what is the first quarterly report from the state real estate bodies.

Perth has become a buyers market, with the number of houses for sale reaching 17,600, up 240 per cent on the 5000 listings 18 months ago. The 2.7 per cent decline – the biggest quarterly fall since September 1998 – follows a year when Perth property markets grew just 1.1 per cent, although in the three years before that they rose 70 per cent.

If your Real Estate Agent seems stressed, it’s not because of the pending bubble popping, but their ballooning workload.


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Tread warily when you buy into the dream of home ownership

Written by admin on April 12, 2008 – 5:05 pm

If a picture is worth a thousand words, today’s graph would suggest I don’t have to write a column this week. The graph was put together by the Reserve Bank’s head of economic analysis, Anthony Richards, and tracks the movement in house prices over the past 35 years compared with movements in rents, household income and construction costs.

Something is way out of kilter, and the bad news for home owners is that it’s not that new entrants to the property market aren’t earning enough or governments aren’t helping enough through pointless schemes such as the first-home owner grant.

The graph is similar to the one published here @ who crashed the economy, 18 months ago.

» Tread warily when you buy into the dream of home ownership – The Sydney Morning Herald, April 12th 2008.

» Some Observations on the Cost of Housing in Australia – Tony Richards Reserve Bank of Australia, May 2008.


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US consumer confidence drops to 26-year low

Written by admin on April 12, 2008 – 5:03 pm

Confidence among US consumers fell to a 26-year low after employers fired workers and petrol prices surged, threatening the spending that accounts for more than two-thirds of the economy.

The Reuters/University of Michigan preliminary index of consumer sentiment decreased to 63.2 this month, the weakest level since 1982, when the jobless rate approached 11%, the worst since the Great Depression.

» US consumer confidence drops to 26-year low – Sydney Morning Herald, April 12th 2008.


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WA in “unprecedented” mortgage sales decline: AFG

Written by admin on April 11, 2008 – 9:42 pm

For the first time since its reporting began, AFG, Australia’s largest mortgage broker, has shown that mortgage sales in WA fell every month for the first three months of the year, when compared to sales for the same three months of 2007.

This sales contraction is unprecedented in AFG’s experience: until this year, the company has never seen sales fall for more than a single month, when compared with data from a previous year.

The worst affected state was NSW, where sales declined by 18.9%, followed by Queensland (16.4%), South Australia (11.6%) and Victoria (4.9%).

» WA in “unprecedented” mortgage sales decline: AFG – WA Business News – 10th April 2008


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Sydney house prices predicted to fall by up to 30pc

Written by admin on April 9, 2008 – 6:07 pm

SYDNEY house prices could fall by as much as 30 per cent in the next two years, economists say.

They warned the pain will not be confined to Sydney’s struggling south and west, where prices have already dropped dramatically.

“In Sydney, a typical house will cost 8.4 times a typical family’s household income, which is patently unaffordable,” he said.

“That compares with 3.6 times income in America – where prices have recently fallen by 10 per cent – and 5.5 times income in the UK, which is currently experiencing a housing downturn.

» Sydney house prices predicted to fall by up to 30pc – news.com.au, April 9th 2008.


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Consumer confidence now lowest in 15 years

Written by admin on April 9, 2008 – 6:05 pm

Consumer confidence has dropped to a 15-year low, failing to recover this month despite a pause on official interest rates, according to figures out today.

» Consumer confidence now lowest in 15 years – The ABC, 9th April 2008.


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UK: Biggest house price plunge for 15 years

Written by admin on April 9, 2008 – 6:49 am

House prices in Britain plunged last month by the worst figure since the financial crisis in the early 1990s. . .

» Biggest house price plunge for 15 years – UK Times Online, 8th April 2008


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Australia vulnerable to US ‘tsunami’, IMF warns

Written by admin on April 9, 2008 – 6:31 am

AUSTRALIA’S overvalued housing markets and high levels of debt put it at risk of being hit by the financial tsunami swamping markets in the United States, the International Monetary Fund has warned.

The IMF’s latest Global Financial Stability report, released overnight, estimates that losses to banks, borrowers, investors and other financial institutions in the US are now likely to exceed $A1000 billion. It says the crisis is spreading into prime real estate loans, consumer credit, commercial property and corporate debt.

» Australia vulnerable to US ‘tsunami’, IMF warns – The Age, April 9th 2008.


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Job ads at lowest level in 14 years

Written by admin on April 7, 2008 – 5:11 pm

THE number of jobs advertised in major newspapers has fallen to its lowest level in more than 14 years, with back-to-back interest rate rises causing a decline in every state and territory, a survey shows.

The ANZ job ads series shows that the total number of website and print advertisements declined by a seasonally adjusted 0.7 per cent in March to a weekly average of 267,041.

The Australian goes on to report the number of Job ads in NSW is at it’s lowest level since December 1983. The Northern Territory experienced the biggest decline of 31.1 per cent and its biggest monthly fall on record.

» Job ads at lowest level in 14 years – The Australian, April 7th 2008.


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Spain: Foreign banks flee Spanish property debt

Written by admin on April 6, 2008 – 6:49 am

International banks are scrambling to sell their holdings of Spanish mortgage debt at a steep discount, fearing that the country may be sliding into the worst economic downturn in its modern history.

» Foreign banks flee Spanish property debt – The Telegraph, 5th April 2008.


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Risk of local property correction high

Written by admin on April 4, 2008 – 5:40 am

THE risk of a correction in Australian house prices is high by international standards, the International Monetary Fund (IMF) says.

The IMF, which says Australian property is among the most overvalued in the developed world, has warned that about 25 per cent of the increase in house prices between 1997 and 2007 cannot be explained by fundamental economic factors such as population growth and income, The Australian Financial Review reports.

» Risk of local property correction high – news.com.au – 4th April 2008


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