Sydney: fell 0.3 per cent to $554,000 Perth: fell 2.5 per cent to $460,000 Canberra: fell 6.8 per cent to $445,000 Melbourne: fell 8.4 per cent to $432,500
Something is having an effect on prices in the last quarter in these cities.
I think much greater than 50% chance of rate rise happening after the next cpi results...inflation shows no signs of slowing yet. The bank bills are still very high and trending up over the mid to long term.
Early days in my books...still see substantial falls especially in a slowing economy. The rising fuel price is like rising interest rates and then add on rising food and costs and people are really starting to hurt.
Demand is dropping and supply is increasing as I keep saying. People dont just want to sell but are needing to sell whilst at the same time those with cash are beginning to hold off.
There is no choice but to keep lowering prices.
Raise my rents by 10%...whoopee I pay another $30 a week. But if your house falls 10% you are effectively losing $1000 a week then add on rates insurance maintenance and oppurtunity cost of having your money tied up and you are miles behind. Half of our capital cities are on track to lose more than 10% this year in value and my guess is the other half will start going into reverse if not already and get close to double digit falls.
Also the selection of houses to buy is increasing incredibly fast...its all coming together.
