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laurejon

The Great Ozzie Dream

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AUSTRALIANS are confident house prices will rise over the next quarter as the nation piles money into property, but most people believe sellers want too much and could be forced to drop their prices, a survey reveals.

A survey by NEWS.com.au and polling firm Coredata has found more than one in two Australians, or 57 per cent, believe property prices will rise over the next three months.

That is the highest level of confidence of house price rises recorded in the two-year history of the survey.

Just 13 per cent of the 1778 people surveyed from June 4 to 12 thought residential property prices would fall over the next quarter, down from 42 per cent of respondents in a December survey.

In recent times, house prices have been stagnant or grown only modestly given a property downturn. But the survey reveals that the property downturn has been left well and truly behind as optimism about the property market rises.

Vendors too hopeful

Despite the increased belief that house prices will rise, most respondents, or 68 per cent, believed home sellers had unrealistic expectations of selling prices.

Given three rises in interest rates in 2006, 46 per cent of respondents thought vendors would have to accept lower prices when selling their homes.

That could be good news for home buyers, who could benefit from discounting of property prices by vendors desperate to make a sale during the coming spring property season.

According to data from the Australian Bureau of Statistics, house prices across the nation rose 8.3 per cent over the 12 months to December 2006.

House prices rose in all cities, except Sydney, where they fell a modest 0.1 per cent.

Financial difficulties

The survey also revealed 5 per cent of respondents had sold properties because they could not afford to keep up with higher loan payments.

Just over one in five, or 22 per cent of respondents, thought their property has fallen in value in the past twelve months.

Of those who have seen the value of their property decline, 30 per cent said they held "negative equity" or that their mortgage was worth more than their home. This equated to 8 per cent of all borrowers.

Property investors who also bought at the peak of the boom of 2003 have been particularly stung by higher interest rates, with official rates sitting at a six-year high.

Bank repossessions of properties are rising around Australia, particularly in the mortgage belts of Sydney and Melbourne, as some people fall behind on mortgage repayments given high living costs.

Analysts say interest rates could rise in 2007 as the economy powers ahead. The central bank sets interest rates to keep inflation between 2 and 3 per cent.

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AUSTRALIANS are confident house prices will rise over the next quarter as the nation piles money into property, but most people believe sellers want too much and could be forced to drop their prices, a survey reveals.

A survey by NEWS.com.au and polling firm Coredata has found more than one in two Australians, or 57 per cent, believe property prices will rise over the next three months.

That is the highest level of confidence of house price rises recorded in the two-year history of the survey.

Just 13 per cent of the 1778 people surveyed from June 4 to 12 thought residential property prices would fall over the next quarter, down from 42 per cent of respondents in a December survey.

In recent times, house prices have been stagnant or grown only modestly given a property downturn. But the survey reveals that the property downturn has been left well and truly behind as optimism about the property market rises.

Vendors too hopeful

Despite the increased belief that house prices will rise, most respondents, or 68 per cent, believed home sellers had unrealistic expectations of selling prices.

Given three rises in interest rates in 2006, 46 per cent of respondents thought vendors would have to accept lower prices when selling their homes.

That could be good news for home buyers, who could benefit from discounting of property prices by vendors desperate to make a sale during the coming spring property season.

According to data from the Australian Bureau of Statistics, house prices across the nation rose 8.3 per cent over the 12 months to December 2006.

House prices rose in all cities, except Sydney, where they fell a modest 0.1 per cent.

Financial difficulties

The survey also revealed 5 per cent of respondents had sold properties because they could not afford to keep up with higher loan payments.

Just over one in five, or 22 per cent of respondents, thought their property has fallen in value in the past twelve months.

Of those who have seen the value of their property decline, 30 per cent said they held "negative equity" or that their mortgage was worth more than their home. This equated to 8 per cent of all borrowers.

Property investors who also bought at the peak of the boom of 2003 have been particularly stung by higher interest rates, with official rates sitting at a six-year high.

Bank repossessions of properties are rising around Australia, particularly in the mortgage belts of Sydney and Melbourne, as some people fall behind on mortgage repayments given high living costs.

Analysts say interest rates could rise in 2007 as the economy powers ahead. The central bank sets interest rates to keep inflation between 2 and 3 per cent.

Australia is going through one of its best growth periods ever with the high price of natural resources and its deep reserves of copper, uranium, coal, zinc you name it. If you are a miner its the place to be. AS long as China is growing Australia is growing. It makes me think what is the UK providing that China and India need, our jobs.

Edited by joey

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polling firm Coredata has found more than one in two Australians, or 57 per cent, believe property prices will rise over the next three months.

The mining commodities boom that Australia is experiencing is the culprit.

Before this became an issue I thought Australia was in for a prolonged decline for property prices / eroded by wage inflation.

Now its pushing the prices up even more!

Its crazy! Its not like they are short of land or anything.

The majority of land and home owners wont mind.

Its the younger generation I feel for. :(

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I am looking to buy a property in suburban Melbourne in 12 months time - so I have a deep personal interest in this subject.

Are there any 'local' Australians who can comment on the true situation in Melbourne?

It seems the article is saying 'people think prices will rise - but they also think sellers will have to lower asking prices to sell'...........strange?

Regards.

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Sentiment is very strong here because of the mining boom.

I live in a place called Geraldton which is where a lot of fly in/fly out miners live, has a port and is building another deep water port and the boom here has been fooking massive. A friend bought a bit of land with an old house on it near where the new port is to be built 18 months ago for 130k. Just sold it for 800k because of the announcement.

That said, houses are starting to really stick around here as expectations are way to high.

The headline on local rag last week was about the probability of land values crashing because of a massive OVERsupply.

The real local yocals of course have seen it all before and know what will happen when the mineral boom ends. This place dies.

On a more national scale, there is a real dearth of financial bearishness common in UK and US newspapers. Folks seem to think that Oz is immune to any downturn because of the commodity boom which is definitely reflected in the attitudes of journos. The papers are effectively cheerleading the whole thing along.

I suspect it will continue until the Beijing Olympics and that might put the cork back on the bottle once its over.

The boom has really fooked up this country. Read this from a mate of mine. It has become America with none of the advantages of being America.

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Thanks for your reply - good to hear it from the locals.

It seems to me Perth is still going 'mental' - I hear mixed opinions from Melbourne.

Once again - many thanks for your views - interesting article too.

Regards.

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Australia is going through one of its best growth periods ever with the high price of natural resources and its deep reserves of copper, uranium, coal, zinc you name it. If you are a miner its the place to be. AS long as China is growing Australia is growing. It makes me think what is the UK providing that China and India need, our jobs.

And we provide the money to allow them to build a huge industrial base with which to destroy ours. Eventually they will be rich enough to consume their own products and we will be unable to afford them. :angry:

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Thanks for your reply - good to hear it from the locals.

It seems to me Perth is still going 'mental' - I hear mixed opinions from Melbourne.

Once again - many thanks for your views - interesting article too.

Regards.

Cough try asking here * cough *

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