Australia is in the midst of a tough economic climate that has affected many areas of finance and industry. One of the areas that is feeling the pull of a poor economy is the real estate industry. A recent report published by the property information provider RP Data shows a significant drop in real estate prices in the capital cities throughout Australia.
Buyers Benefit From The Troubling Economy
While many people may complain about the state of the economy in Australia there is one group of people that are very happy indeed. New home buyers are getting some of the best deals in recent years on purchasing homes. Studies show that the average price of houses located within the capital cities of Australia have dropped 8 per cent.
For buyers who are looking for vacation property the news is even better. Some of the coastal areas in Australia have reported up to a 20 percent drop in prices. People who are trying to sell their homes in this current economy are having to make some serious price concessions in order to make a sale on their property.
House Prices May Start High, But End Up Low
The recent report made its findings based on the original asking price for a home leveled against what the home actually sold for. In the tough Australian real estate market sellers are realizing that they will not be able to get as much for their home now as they would like.
Research analysts feel that some of the price fluctuations may be due to homes being over priced to begin with and listed higher than what the market will endure. The drastic reductions on coastal homes and vacation homes can be attributed to an overall decrease of discretionary assets across the board. When a person is worried about losing their job, or facing pay cuts, a vacation home is not deemed to be necessary anymore. The sudden need to liquidate or unload the property to make regular ends meet can lead to a big slash in the asking price.
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Tags: Australia real estate market, Australian real estate, capital city property, Property, property options blog, Real Estate, real estate market Australia
{ 2 comments… read them below or add one }
Hi Sean,
A slowing economy is a great time for buyers. Housing prices are dropping and people can be forced into a situation where they need to liquidate their assets. It’s not good for sellers but definitely good for buyers.
A market correction was almost ineviatable as house prices did jump very quickly. In my area they pretty much tripled. As a rising tide raises all ships, I guess the opposite is also true.