Panic sellers at top end, eager buyers at bottom
Stapleton, John. The Australian [Canberra, A.C.T] 03 Nov 2008: 4.
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Abstract
At the bottom end -- $300,000 to $500,000 -- the market is being labelled "white hot", at least in terms of buyer interest, thanks to recent increases in the first-home buyers grant.
One happy couple is Risto and Makedonka Sterjovski, who last week looked like they were going to miss out when the bidding for a four-bedroom house at South Morang, in Melbourne's north, failed to reach the reserve price.
"A lot of people have been caught short with margin calls, having to make substantial repayments on share portfolios on 24 hours' notice," he said.
THE Australian property market has become polarised, with analysts pointing to high levels of activity at the top and bottom of themarket -- and a wasteland of falling prices and disappointed sellers in between.
Real estate agents in Sydney and Melbourne are reporting that thousands of executives caught short on margin calls are dumping real estate for any price they can get, with many properties being snapped up by cashed-up Asian investors taking advantage of the weakAustralian dollar.
At the bottom end -- $300,000 to $500,000 -- the market is being labelled "white hot", at least in terms of buyer interest, thanks to recent increases in the first-home buyers grant.
One happy couple is Risto and Makedonka Sterjovski, who last week looked like they were going to miss out when the bidding for a four-bedroom house at South Morang, in Melbourne's north, failed to reach the reserve price.
A week later, agents negotiated a price of $440,000 -- believed to be less than the reserve.
Ray White auctioneer Tony Lombardi said the Sterjovski family were part of trend where buyers, aware the market was down, were forcing owners to keep prices realistic. He said any property deemed overpriced was not selling.
Kevin Lee, financial analyst with mortgage brokers Smartline, said the number of prestige homes for sale in upmarket suburbs had jumped sharply, but vendors were not getting their desired price.
"A lot of people have been caught short with margin calls, having to make substantial repayments on share portfolios on 24 hours' notice," he said.
"All that money they were playing with has vanished. They need money in a hurry. People are selling homes over $2 million for much less than they hoped and much less than they were worth six or 12 months ago."
Melbourne real estate agent Jeanine Dwyer, from RT Edgar Toorak, said properties in the Victorian capital in the $2million to $2.5 million range were still receiving strong inquiries from international investors looking to take advantage of the falling Australian dollar.
Quarterly figures to be released by Australian Property Monitors this week are expected to show a flattening market.
Senior economist with APM Liam O'Hara said he expected a 10 per cent price drop in house prices across the board.
Credit: John Stapleton, Andrew Trounson, Additional reporting: Sanna Trad
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