Real estate ‘rollercoaster’ coming as prices plummet

Housing prices are falling as Australia’s property market continues its wobble. Many people fear that selling or buying is too risky.

A Current Affair has spoken to experts to clarify the market. They will reveal when you should purchase and when you should list.

Joanna and Grant had been searching for a home for over two years. However, properties in Melbourne’s Narre Warren have only recently become available.

Grant stated that Grant and his wife have seen one house and it is currently listed at $795,000. It would have been worth more than $1 million two years ago.

Nationally, overall values are down by almost eight percent from 2017. Sellers are becoming more realistic with their prices, which makes it a buyers market.

Grant stated, “I don’t believe there’s a better moment to buy.”

Despite the fall of prices, there are still more homes available than ever since 2012.

Peter Kakos was an auctioneer at Agency. He stated that potential buyers waited for prices to fall further.

He stated, “But, the truth is, heat has left market, so there’s now an incredible buying opportunity.”

Redcliffe, Chermside, and Neutral Bay in Queensland all offer great value. Port Melbourne and Carnegie are great options.

The property market is experiencing a flood because of the over-supply in Sydney, Melbourne and Brisbane. This means that there are significant discounts on this market.

Frank Valentic is a vendor advocate who stated that it was a combination factor such as the royal commission or Australian Prudential Regulation Authority (tightening of the screws) that made financing difficult for investors and home-buyers.

He also stated that units have low capital growth prospects.

He stated that “the old rule of real property is that land appreciates, and buildings depreciate.”

“Land is always king.”

Rob Klaric is a real estate expert and investor. He said that the area is 20km from any major Australian city.

He stated, “They’ve got jobs, they’ve got infrastructures, they’ve got transport, and they’ve got lifestyles.”

“The more you travel away from major cities, the more difficult it is.” In the next six to 12 months, we’ll see the biggest declines in realty.

Ola Zaryzycki (63), had her house sold for $300,000. This is a significant discount compared to the price it was worth just one year ago.

She stated, “It is heartbreaking, absolutely heartbreaking.”

The prices of Karalee in Brisbane have risen by more than 6 per cent in the past 12 months, but have dropped in Carole Park.

Prices in the Blue Mountains west Sydney are not too high, but they have been in Bass Hill.

While prices in Melbourne have increased, they have fallen in Ashburton.

Uraidla is a top performer in Adelaide. Happy Valley isn’t.

Prices have increased in Mornington, Hobart and Sandy Bay, but they have fallen in Sandy Bay.

Fraser was successful in Canberra. East Arm in Darwin has fallen more than 25%

Winthrop in Perth has fallen by more than 17 percent

CoreLogic’s Tim Lawless stated that the market was slowly improving.

He stated that “we expect housing values to continue falling, but not as quickly as what they were in 2018”.

“Even though rates are held, we still expect that rates will fall later in the year… Any reductions of cash rates will have an impact on the housing markets.”

Experts don’t believe any changes to interest rates would have a significant affect on the market since it is still difficult for buyers get finance.

An economist Stephen Joske has predicted that prices would fall more after China’s financial crisis. This could happen in two years.

He stated, “It’s probable that it will be accompanied with an abrupt fall in the value Chinese property.”

“The Chinese government would retaliate by tightening money control in China. For as long as two decades, you lose many buyers. They would likely disappear from the market.”

Even federal elections can be a factor.

Joske stated Labor’s policy regarding negative gearing would have “some effects”, but not kill market.

He stated, “They’re not abolishing it.” They are limiting their scope.”

Antonia Mercorella is the chief executive of Real Estate Institute of Queensland. The proposal would cause a dramatic decrease in stamp duty revenue as well as increase rental prices.

Experts agree that the market’s future outlook is positive given the population growth. Property is all about demand and supply.

Klaric stated, “This is going to be an exciting rollercoaster for real estate in a couple years.”