Although a 60% drop in property prices seems far fetched, investors probably need to prepare for price declines over the coming five years. A slowdown in the mining sector, depressed spending and subdued business conditions due to the high Australian dollar will most likely result in unemployment ticking higher. Higher levels of unemployment will counter any positive effects from any interest rate falls over the coming months and years. With two-bedroom shacks in Mount Druitt, Sydney going for more than $500,000, the market is looking perilously toppy. So if you urgently need to sell your property for financial reasons, you may want to consider cutting your sale price sooner rather than later; because if a flood of properties hit the market, you simply may not be able to offload it no matter the price.
