Australia Property News: Its Not Good News

Well I tried really hard to find a more upbeat post on Australian property news compared to my last post. Unfortunately the world is not cooperating with me today. Its all doom and gloom in the property world down under.

West Australian Property Down

The Australian is reporting doom and gloom for the former golden child of Australian property investment – Western Australia. The fall out from the mining boom collapse has seen properties in the over $1million bracket have collapsed 20%.

Real Estate Institute of Western Australia deputy president David Airey said there had been just 85 sales in Perth’s affluent western suburbs in the three months to December, down from 150 the previous quarter and 300 at the same time in 2007, The Australian reported.

“Properties … purchased as recently as a year ago have been listed or sold below their original asking price,” he said.

Mr Airey said house prices in the state were expected to fall further as the global financial crisis continued to unfold and mining companies retrenched staff.

Adviser Edge head of property research Louis Christopher said Perth house prices were expected to fall by between 8 per cent and 12 per cent this year.

So bargain time in the luxury property market in the West

Southern Highlands Property Going South
On the other side of Australia, the prestigious Southern Highlands area south of Sydney is also suffering, thought not as severely as in the west, probably because the boom is neither as recent or as excessive as it was in the west. The figures for Burradoo NSW are that prices are down 10% – though the top end of the market is holding up better in NSW’s Southern Highlands.

Meanwhile those cautious investors who thought that Mortgage Funds were a safer investment option than direct property investment still have their funds frozen.

Again The Australian reports

THE 250,000 investors with more than $25 billion tied up in the frozen mortgage funds sector are unlikely to see their cash until at least next year, with not one fund being unfrozen since the sector was ravaged in October.

Property Investment Research associate director Dugald Higgins said those mortgage funds would unfreeze assets only when investor sentiment in financial markets improved substantially, and no freezes were likely to be lifted until at least 2010.

“Nothing really has changed since the rush of freezing activity in October,” Mr Higgins told The Australian.

The sad part is that these investors are often retirees who thought they were in a low-risk investment and were reliant on the income that these mortgage trusts used to be so good at producing.  More than 30 institutions froze funds in October in response to the Federal government’s guarantee for bank deposits.

The latest new is the PM Kevin Rudd is talking down the economy -saying that it will get worse before it get betters – how much worse is the real question.

Well after all that all I can say is check out our new international property listing service to bag that bargain in international property!