At first, when you think about how the price of property is declining in all of the capital cities with the exception of Darwin and Adelaide, it only makes since to think that the real estate market in Australia would be bombarded with bargain properties; however, that may not be the case exactly.
Louis Christopher of SQM Research says,
“A bargain can always become a better bargain…” he adds, “…property is never priced too high to go higher, nor too low to go lower.”
The biggest problem investors face when prices fall in the property market is the fact that not all property 
prices are falling, nor are all the suburbs. As a matter of fact, real estate that is priced lower is intensely challenged because of the grants for first time homebuyers, making it difficult to find the best bargains.
According to Liam O’Hara, chief economist for Australian Property Monitors, bargains are more likely to show up in the prosperous suburbs of Australia, where the debt-to-income ratios are higher. This is mainly because when times were not so tight; these people were allowed to borrow more money.
Bargain Hunting Guidelines
Bill Fatouros, the head of residential valuations at Landmark White, says it is a bargain when the investor pays at least 30% less than what they would have two years ago. Fatouros warns that it can be complicated to come out with the best bargain when prices in the market are on a downward slide. It is important that you know what you are looking for to be able to tell when a bargain is truly a bargain.
• Find out why the property is available, such as divorce, financial trouble, death, etc.
• Do adequate research to find out the circumstances of other sales in the area.
• Remember that a low price does not always equal a high value.
Once you begin researching the property market in Australia, you will easily learn where to find a true bargain.
Property Options Australia
Property Options Blog © 2006 – 2009
Tags: Australian property market, Australian Property Monitors, Landmark White, property in Australia, property options blog, real estate in Australia, SQM Research
{ 3 comments… read them below or add one }
Hi Sean,
Wow! I wouldn’t have thought to look in the more prosperous suburbs for a bargain. But it makes sense as the more you earn; the more the bank will let you lend and the more you spend.
Still, a bargain in the property market in Australia depends on what your profit is once you sell it.
I had heard tales on talkback radio of upmarket properties being rented out by their owners while they had to move to more modest dwellings to make ends meet. The banks have definetly tightened their lending critrea and as such all areas of the market will feel the pinch. the lower end may be slightly immune due to the first home owners grant.
Just so you know there is a typo in the first paragraph.