Victorian house prices suffer biggest drop in 40 years

[bluelabel]

Just read this in the small Melbourne paper. Victorian house prices suffer biggest drop in 40 years (http://www.news.com.au/heraldsun/story/0,21985,25415325-661,00.html)

I think the headline only refers to a few suburbs only, but that i was you come to expect from sensationalist tabloid journalism. I cant see the drop in my area, SE Melb, i see it rising, just on observation, no surveys.

I have noticed aswell that the top is coming right off the market and high end property/houses just arent selling. This is the balancing of the market we were expecting to see. I still see it dropping a little bit more, maybe 6-7% overall over the next 9-15 months. :2twocents:

:bier:

blue

[kincella]

Hi Blue....you know how they calculate the median price...so if only the lower priced houses are selling...the median price must come down to reflect same...hence the drops you are seeing...they are very small...
it does not mean the actual prices have come down....in fact with so much competition in the lower price brackets I have seen prices rising....and without the higher priced props selling...to affect or change the median....some people can be fooled if they do not understand this
see this article that shows rising prices...........

Cheaper homes, but going up
Natalie Craig


HOUSES in more affordable Melbourne suburbs are appreciating faster than those in traditionally lucrative areas such as Camberwell, Toorak and Canterbury, data shows.

The Real Estate Institute of Victoria's quarterly house price figures show that 15 of Melbourne's "top 20" growth suburbs for the first three months of the year had a median price below $500,000.

Real estate industry executives say this is because of falling interest rates and first home buyers' grants.

Suburbs with the fastest growing prices included Mount Martha, up 16.3 per cent to $500,000, Keysborough, up 12.9 per cent to $390,000, Epping, up 8.1 per cent to $303,000, and Boronia up 6.9 per cent to $355,000.

However, the overall Melbourne median house price fell 3.1 per cent to $410,000.

http://www.theage.com.au/national/cheaper-homes-but-going-up-20090501-aqar.html

[bluelabel]

Hence my previous comment about sensationalist tabloid journalism. Both of these articles are based upon the same set of data yet are written so differently it's not funny. It is true what they say; you can interpret statistics to mean anything.

Read the differences here:

Herald Sun Victorian house prices suffer biggest drop in 40 years (http://www.news.com.au/heraldsun/story/0,21985,25415325-661,00.html)

The Age Cheaper homes, but going up
(http://www.theage.com.au/national/cheaper-homes-but-going-up-20090501-aqar.html?page=-1)

Anyway, back on topic, what you are saying is the median price is worked out on what is actually selling. So if all that sells is $200,000 homes, then the median price will be $200,000. So in effect what these articles should be saying is that the lower end of the market is more active than the rest which would theory be pushing up low end house prices, which is what I commented on in my earlier post.

I can’t see the drop in my area, SE Melb, I see it rising, just on observation, no surveys.


:bier:

blue

[kincella]

exactly...entirely agree with you....except for the drop you are expecting....I believe investors will step back into the market...due to the low interest rates and positive returns...
copied this post of mine from ASF today
its a good article....aimed at investors

Gearing for a housing deficit....

Building approvals have collapsed in the past year and completions in 2009-10 could fall below 120,000. Australia currently has one of the (if not the) strongest population growth rates in the developed world and even if skilled migration targets were cut to zero in the years ahead in response to fears of rising unemployment, underlying housing demand would still be 150,000 in 2010.

"We currently estimate that by mid-2010 Australia will have an unprecedented underlying housing shortage of 250,000 dwellings."

Put your money where the transport is

For people looking to take advantage of low interest rates to buy a residential property as an investment, Steve McKnight offers the following advice: "It should have three bedrooms or more and at least two bathrooms. Close to parks and schools is ideal.

"It should also be near public transport. The number of people catching public transport to get to work is going through the roof. In Sydney and Melbourne the train is better than any other form of transport, so people will want to have that flexibility of living in an area where they can walk to a railway station. And they will pay more for it.

"Aim for 680 square metres of land or better, to preserve the potential to sub-divide the property. And if you cannot afford to buy in an A-grade area, buy in the suburb next door. Gradually that A-grade area will price itself out, because people will not be able to afford to live there, and the B-grade area next door will move up in price."

http://www.brisbanetimes.com.au/arti...16.html?page=2

[francinemelbour]

I checked the resources that you post, but the page was not found, I have doubt about that news about house pricing.