The property market could be set for early-year price falls due to a build up of unsold properties, with new figures by property research company SQM Research showing the number of listings swelled 44% over 2010.
Managing director Louis Christopher says while a short-term monthly slowdown in the capitals can be attributed to the Christmas period, (online listings dropped 1.9% in December), overall the huge number of listings means prices are now hanging by a thread and a market downturn is imminent.
“It’s still very clear to us that they are now at levels that would suggest a downturn in the housing market, although the stock levels have fallen seasonally. The overall number is up now by 44% across the nation. “
“I wouldn’t like to see another interest rate rise anytime soon – it will accelerate the downturn.”
The claim contradicts predictions that prices will remain stable or grow by 5-6% growth range in 2011 due to an underlying shortage of properties.
The new figures suggest that the shortage has been overblown. Residential property listings were 328,270 during December, representing an increase of 44.9% over the year.
Please see one of our most popular posts where we discuss “undersupply” in detail.
Last year according to RPData Australia built 170,000 houses while the population growth was falling very quickly. In the year to June the population grew by 377100 , which means that once again Australia overbuilt.
Again we state:
At end of every bubble there comes an admission that the “undersupply” of housing was in fact a debt driven myth that only really existed because there was an oversupply of speculators. As the market collapses these people disappear and all of a sudden there are too many dwellings on the market and not enough buyers
We can only say we warned you.
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