Thanks to incompetent State and Federal (ALP) Governments, the West of Sydney is imploding financially.
Will Rudd apologize to Sydney homeowners? Will Iemma freeze over the issue, as he has done on all other issues?
Sydney houses being sold for as much as 40% beneath their 2004 values.
Working families being dudded by Rudd.
Monday, March 03, 2008
Rudd, Iemma Combine to Crush Australian Dream
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Landslide: Sydney house values drop
by Kelvin Bissett and Justin Vallejo
HOMEOWNERS in Sydney's outer suburbs have been losing as much as $450 a week every week since early 2004 on the value of their properties as the real story of mortgage belt misery begins to emerge.
With the Reserve Bank likely to announce yet another interest rate hike tomorrow, a Daily Telegraph investigation reveals hundreds of streets in Sydney's outer suburbs now have houses that have been bought and sold at a loss - in rare cases more than 40 per cent in value.
Since the peak of the boom in early 2004, Sydney's southern suburbs has dipped the most in value, with the median price falling $82,750 over the ensuing 15 quarters, according to Australian Property Monitors figures.
Other areas where the Australian dream is souring include Canterbury Bankstown which has registered $65,000 in losses, Sydney's south west $44,500 and Sydney's west $25,000.
On a per week basis, the changes in median prices to late last year equate to $444 a week losses for the south, $349 for the Canterbury-Bankstown area, $239 for the south west and $134 for west.
The decline in median price values are despite a mini-boom in real estate in the more affluent eastern half of the city.
But while these changes are based on median movements, a new report by MVS Valuers analysised hundreds of case studies of resold homes to offer more detail on how homeowners are hurting.
The MVS Valuers analysis shows that anyone who has bought as long ago as January 2002 and resold recently in Sydney's west and south west is likely to have copped a loss.
Prime Minister Kevin Rudd is today expected to unveil a plan to help families battling housing stress in a move designed to take the heat out of the latest Reserve Bank rate hike.
Last month, on the day before the central bank increased rates to an 11-year high of 7 per cent, Mr Rudd announced the government's $850 million first-home saver accounts scheme.
Mr Rudd's annoucement comes after new research shows 1.1 million low to middle income households are now spending more than 30 per cent of their income on housing.
To present an accurate picture, anomalies such as upgraded homes, sales within families and vacant blocks that have been built on were removed from the analysis.
Among some of the worst losses studied, a home in New Cambridge St, Fairfield West bought for $780,000 in November 2004 sold in July last year for $415,000, a loss of 46.8 per cent.
At Bond Place, Oxley Park, a unit bought for $455,000 in August 2005 sold last May for $250,000.
At McAndrew Close, Lurnea, a house bought for $420,000 in December, 2004 sold last June for $267,000.
On average houses actually bought over the past five years and then resold have resulted in losses of $20,912 in Sydney's west and $20,435 in the south west for their owners.
MVS Valuers director Peter Raptis said there was little likelihood of a recovery in prices in the short term. He predicted more possible losses ahead, or at best nominal growth.
He said the succession of interest rate rises had already "spooked" the market.
"You can now get a house, possibly fibro and maybe nothing special but still on a decent block for under $200,000 if you know where to look," he said.
"It's amazing how cheap properties are in some places in Western Sydney," he said.
"We've seen places go for $160,000 to $180,000. That's astonishingly cheap when you remember this is Sydney."
Homes in Sydney's west and south west are now siginificantly cheaper than the estimated average price of a home in every other Australian mainland capital, now all in excess of $400,000.
Aussie Home Loans chief John Symond said last night that Sydney's mortgage belt was now the nation's "struggle street" and will pay a heavy price for any further increases in interest rates.
Like other property experts, Mr Symond had few words of short-term hope for embattled homeowners in Sydney's west and southwest with a prediction that their home values would remain "flat, or probably soften" this year.
"The higher interest rates go up, the more suppressed house prices are going to be," he said.
His advice to homeowners was to examine their personal finances and credit card debts to find savings to offset the rising rates.
Other experts were similarly pessimistic.
RP Data residential research director Tim Lawless said dwelling prices in Sydney's mortgage belt areas "are largely yet to recover back to 2004 levels."
"The problem is that there is simply a large amount of supply and little demand from purchasers. This problem is exasperated by the fact that prices probably overshot the market during the previous boom which ended in 2003," he said. battling housing stress, in a move designed to take the heat out of the predicted Reserve Bank interest rate rise.
Last month, on the day before the central bank increased rates to an 11-year high of 7 per cent, Mr Rudd announced the Government's $850 million first-home saver accounts scheme.
Mr Rudd's latest announcement comes after research shows 1.1 million low to middle income households are spending more than 30 per cent of their income on housing.
MVS Valuers director Peter Raptis said there was little likelihood of a recovery in housing prices in the short term, instead predicting more possible losses ahead or, at best, nominal growth. The succession of interest rate rises had "spooked" the market, he said.
To present an accurate picture, anomalies such as upgraded homes, sales within families and vacant blocks that have been built on were removed from MVS Valuers analysis.
Among some of the worst losses, a home in New Cambridge St, Fairfield West, bought for $780,000 in November 2004 sold in July last year for $415,000, a loss of 46.8 per cent.
At Bond Place, Oxley Park, a unit bought for $455,000 in August 2005 sold last May for $250,000. At McAndrew Close, Lurnea, a house bought for $420,000 in December 2004, sold last June for $267,000.
On average, houses bought over the past five years and then resold have resulted in losses of $20,912 in Sydney's west and $20,435 in the southwest.
"You can now get a house, possibly fibro . . . for under $200,000 if you know where to look," Mr Raptis said.
"It's amazing how cheap properties are in some places in western Sydney," he said.
"We've seen places go for $160,000 to $180,000. That's astonishingly cheap when you remember this is Sydney."
Homes in Sydney's west and southwest are significantly cheaper than the estimated average price of a home in every other Australian mainland capital, now all more than $400,000.
Aussie Home Loans chief John Symond said last night that Sydney's mortgage belt was now the nation's "struggle street" and would pay a heavy price for any further increases in interest rates.
Like other property experts, Mr Symond had few words of short-term hope for embattled homeowners in Sydney's west and southwest with a prediction that their home values would remain "flat, or probably soften" this year.
Hi
Nice blog.
But how is this Rudd/Iemma's fault?
Good point anon. I seem to recall that each of those two went to their last elections saying that they were helpless over the issue, and could do nothing under the circumstances.
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