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House values on the slide, units on the rise.

By arescarti42 - 6 March 2011 9

For those of you who missed it, the ABC released an article last Monday on declines and rises in the ACT housing market.

Reportedly, home values plunged by 4% whilst units increased by 4% in the 3 months to January.  Perhaps an indication of preferences moving away from the traditional suburban standard?  Who knows.

At the very least I suspect it might be making recent first home buyers, some of whom have less than 4% equity in their homes, a little nervous.

What’s Your opinion?


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9 Responses to
House values on the slide, units on the rise.
Captain RAAF 8:07 pm 07 Mar 11

georgesgenitals said :

Captain RAAF said :

Had a couple of houses very near me sell recently and they went for tidy sums of money and within the asking price window.

Where is this house price crash of which people speak?

There won’t be a ‘crash’ in the sense that many people expect, but rather a softening (stagnation) of values over time while other things (like incomes, other costs) relatively catch up.

Ok George, is this a thing thats going to happen in the near future? The reason I ask is it isn’t happening now so when is this great flaccidation going to occur? My mum just sold her property, she wanted 1.1 Mil $$$ for her 3 acres in semi-rural Melbourne and the estate agent, after first agreeing with her on the value then told her that things are ‘slowing down’ and it’s now only worth $800K, fast forward 1 month and she get an offer for 1.1 Million smackeroos, so much for the slow down……..

I don’t buy it, people will just ride it out and not sell until they get the price they want, the economy is doing so well that there just are not many people who are being forced to sell up.

EvanJames 10:43 am 07 Mar 11

Maybe all of the above, and the start of a correction of the crazily over-priced houses in the ACT.

dtc 9:52 am 07 Mar 11

Average house prices is a worthless statistic. For example, if a large development in (say) Forde suddenly became registered and 50 house and land packages went through at the same time, the prices are depressed simply because those houses are cheaper than normal (conversely, if a very expensive house sells in Red Hill and ups the average). Or if an up market unit tower is finished and those sales are all registered at the same time, the price goes up. Canberra isnt a large enough market not to have outlier periods as a result of one off affects.

I remember when Dickson was the cheapest suburb in Canberra one year, because the settlement of the Canberra International Hotel case resulted in 100 or so units being sold for under $100k

here we go, from Allhomes (year, average price)

2001 241,000
2002 275,000
2003 98,000
2004 392,500

Good luck finding a house in Dickson for $98k in 2003, but the ‘statistics’ said you should be able to

georgesgenitals 9:24 am 07 Mar 11

Captain RAAF said :

Had a couple of houses very near me sell recently and they went for tidy sums of money and within the asking price window.

Where is this house price crash of which people speak?

There won’t be a ‘crash’ in the sense that many people expect, but rather a softening (stagnation) of values over time while other things (like incomes, other costs) relatively catch up.

Captain RAAF 8:38 am 07 Mar 11

Had a couple of houses very near me sell recently and they went for tidy sums of money and within the asking price window.

Where is this house price crash of which people speak?

georgesgenitals 7:31 am 07 Mar 11

It’s short term numbers, I wouldn’t be reading too much into it. That said, it’s not a huge suprise, units in some areas are due for a correction (upwards).

I only buy units for investment, but not because of this, but rather because they get better yields while still getting decent growth if bought in the right area.

chewi 1:00 am 07 Mar 11

Could it also be that those who in the past may have purchased an entry level house are now shifting their focus to more affordable units? Is there also currently a relatively greater supply of units coming onto the market than houses?

RedDogInCan 9:49 pm 06 Mar 11

If you have less than 4% equity in your home then it’s going to be the bank’s problem.

satansman 8:51 pm 06 Mar 11

Doesn’t surprise me. Current rates and land tax system system favours investment in units and investors with rental houses are selling up. If you buy a house your rates are a lot higher than if you buy a unit in the same area.

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