So many conflicting signals and views. Low-end house prices 'to fall 10pc' By Maurice Dunlevy The Australian July 09, 2009 12:00am Text size + - Print Email Share Add to MySpace Add to Digg Add to del.icio.us Add to Fark Post to Facebook Add to Kwoff What are these? Play 12345Loading…Please login to rate a video.You can't rate an advertisement.(no votes yet)
Business Update: IMF ups forecast The International Monetary Fund expects the U.S. economy to rebound modestly next year amid stronger... Views today: 14Sorry, this video is no longer available.End of first-home grant to force prices down Lower end of market hardest hit Property guides: Top buyer questions THE end of the Government's first-home buyers grant boost and various state-funded benefits could force down lower-end house prices by up to 10 per cent.
The warning from CB Richard Ellis coincided with Australian Bureau of Statistics figures issued yesterday that show the number of dwellings bought by owner-occupiers in May was 29 per cent higher than in October, when the federal boost was introduced.
CBRE manager of residential research Erin Rolandsen said first-home buyers were responsible for 95.2 per cent of the increase, The Australian reported.
"The fact that first-home buyers have been driving this boom leaves the sub-$500,000 market particularly vulnerable once the boost is reduced from September, 2009," Ms Rolandsen said.
Related Coverage Sales spark hopes for housing rebound The Australian, 1 Jun 2009 First-home buyers slide into world of pain Daily Telegraph, 26 May 2009 Rush on home grant lifts clearances The Australian, 18 May 2009 First-home grant offer extended The Australian, 13 May 2009 Victorians get double first-home bonus NEWS.com.au, 6 May 2009 She said worse would follow after the boost is withdrawn at the end of December, along with the withdrawal of state-funded measures in July next year.
"We expect falls could reach 10 per cent from the peak in some areas, depending on local market conditions," she said.
The CBRE forecast is based on market analysis from the agency's recently issued ViewPoint report.
Ms Rolandsen said the benefit of the $7000 boost for existing homes and $14,000 for new dwellings had been wiped out by the stampede of first-home buyers getting into the market.
Since the the boost was introduced, rising house prices had increased the average first-home buyer loan by $20,000.
Ray White announced yesterday a 33 per cent increase in June sales compared with sales in June last year.
Ray White deputy chairman Sam White said total June sales were $2.411 billion, compared with $1.8 billion last year. He predicted investor-driven growth for the second half of this year.
