Australia’s housing market is showing signs of strong activity, spurred on mainly by bargain hunters and first-home buyers as sellers become desperate.
The number of properties to sell at auction is expected to spike this weekend as prices are slashed by up to 30 per cent and buyer interest is reignited by this week’s 100 basis point rate cut by the Reserve Bank.
The banks’ subsequent mortgage rate cut appears to be adding to the momentum generated by the increase in the first-home buyers grant from last October. The biggest spike was in Queensland.
On the Gold Coast yesterday, half the 12 properties sold at a Surfers Paradise auction were under $500,000, a sharp discount on their asking price.
One Surfers Paradise apartment sold for $195,000, $55,000 less than its original price tag.
Major residential developer Australand, which revealed an 83per cent drop in its annual net profit this week, and Lend Lease’s residential development arm said the number of first-home buyer inquiries had doubled in the three months to January. How many of these enquiries went to contract is the real question, and with bargains galore in the used housing market, people would be checking out these bargains before committing.
Most large residential developers want the Government to extend beyond June the current first-home buyers grant of $21,000 for a new property.
A recent pick-up in housing loan approvals and in reported display home traffic suggests these factors are now starting to add to housing demand
In Sydney’s west, the national market’s worst-hit region, more properties went on mortgagee sale and prices fell sharply to bargain hunters
A near-new three-bedroom home at St Helens in the city’s southwest was under contract for $290,000, $10,000 less than the owner paid six years ago. The property would rent for about $300 per week.
Some properties with four bedrooms and swimming pools were selling in Sydney’s mortgage belt for less than $300,000.
