MANY of the nation's most prestigious suburbs appear to be facing house price slumps amid the credit crunch as their cheaper outer-suburban counterparts begin to emerge from years of price declines.
House values in Sydney's inner and eastern suburbs fell 8 per cent in the six months to September as the credit crunch hit top income earners, according to data compiled by Australian Property Monitors. But at the same time, house values in Sydney's western suburbs -- long derided as the worst performers of the nation -- fell just 2 per cent as new-home buyers sought better value in those long-depressed regions.
Adviser Edge economist Louis Christopher said the tanking of the stock market amid the credit crunch meant many wealthier home owners were forced to sell up to cover share margin calls or because they had lost their jobs in the finance and banking sectors.
"There are lots of desperate sellers at that top end of the market, with many of them forced to sell, and sell very quickly, because of what's happened in the stock market," Mr Christopher said.
RP Data research director Tim Lawless said the trend was a national phenomenon with first-home buyers taking advantage of lower interest rates and cheaper prices in outer areas.
"Many of those inner blue-chip suburbs have typically been perceived as safe havens but at the moment there has been a bit of an about-face," Mr Lawless said.
"It seems the inner areas which are very closely aligned to the state of the equities market and global financial markets are suffering some degree of downturn in the market place."
According to APM, house prices in Perth's inner city and coastal western suburbs fell 7 per cent in the six months to September while house prices in the city's cheaper southeastern suburbs fell just 2 per cent. In Melbourne, inner-city house values fell 3 per cent in the period, while house prices in Melbourne's outer west rose 2 per cent.
While based on a relatively small sample size of 14 sales, houses in Melbourne's blue-chip Toorak slumped 24 per cent in the six months to September. Median house prices in the outer-western suburb of Melton grew 6 per cent to $207,000 in the same period.
Separate statistics, compiled for The Australian by RP Data, found house prices in Sydney's exclusive lower-northern suburbs had fallen 4.8 per cent to $1.23million in the six months to September. At the same time, houses in Sydney's outer-southwest recorded a modest 0.4per cent boost to $317,762.
"We are seeing more and more first-home buyers targeting the lower-priced properties at around $350,000 and less," Mr Lawless said. "There is a lot of pent-up demand in that market segment and those buyers are being attracted back into the market by falling interest rates."
Mr Christopher said the pressures facing the more expensive suburbs could be worse than reported because the statistics typically took between six and eight weeks to filter through to property data.
