Not good news with property values falling across Australia

Plummeting property values have prompted warnings Australia is heading for a one in a 100 year slump. New figures from property analyst Residex showed house and unit prices in nearly every city and rural centre fell in June, News Ltd reports. The last time all states fell at the same time was just before the Great Depression. The slump is affecting the top end of the market as well as the lower end.Residex chief executive John Edwards has warned of tough times ahead.
"It looks like we're moving into a one-in-100-year event," Mr Edwards is quoted as saying.
"It points to a situation where unless the government and Reserve Bank take action Australia could move into a recession."The only other times this has ever occurred are before we have moved into severe recessions."The Residex statistics come at the end of a gloomy week for the Australian economy.Official figures released last week showed housing construction fell for a fourth consecutive month and demand for loans declined by a quarter in the four months to the end of May.Higher petrol prices and interest rates, and the share market slump also saw consumer confidence drop 51 per cent to its lowest level since 1992, when the economy was recovering from recession. Mr Edwards said housing markets in different states usually rose and fell at different times.
"To see an adjustment going on a wholesale basis across the whole of the nation is incredibly unusual," he said."Never in my lifetime have I seen so many converging negative events." Residex reports the current median house value in Sydney is $573,000, down 1.05 per cent in June compared with 1.81 per cent for the three months to the end of June.The falls are happening all over Sydney. While property values in Sydney's battler suburbs in the west and southwest have been dropping for some time, homeowners in well-off areas are now being hit.Among the 20 worst-performing suburbs for houses are the wealthy northern enclaves of Whale Beach, Clontarf, Palm Beach, Elanora Heights, Clareville and Mona Vale.
While Plumpton, near Mount Druitt, was the worst-performing suburb, with negative capital growth of 5.74 per cent in the three months to June and 1.96 per cent in June, Whale Beach came in as the third-worst performer, with negative growth of 3.73 per cent and 1.14 per cent, respectively.Maria Cassarino, from Richardson and Wrench Seaforth, which covers the Clontarf area, reported fewer people had attended open houses in recent months."This time last year we were getting 30 people though a property and now we are getting five," she said.While Seaforth usually had low turnover, Ms Cassarino said the types of properties that had sold after four to six weeks were taking much longer.John Gavagna, principal of Residential Real Estate at Mona Vale, said there had been a slowdown in sales of properties over $1 million, as buyers were more cautious.RP Data's director of property research Tim Lawless said what happened in the coming months would depend on inflation.He showed some optimism, although he said values would probably fall further in Sydney this year."Coming into 2009, it's likely - and it depends on what happens with interest rates - we will start to see some value improvements return to the market, albeit relatively small," he said.It's the same story for units, with Casula the worst-performing suburb with negative growth of 1.8 per cent in the three months to June, and 0.55 per cent in June.Suburbs such as Milsons Point, Double Bay and Greenwich are also among the poor performers.And Sydney rents rose 15.29 per cent in the year to June, the biggest jump in the country. The average Sydney rent is $490 a week, a jump of $65 from last year. Article from Ninemsn