Colliers International has released research today showing a big jump in distressed property listings in the second half of 2012, with further increases expected in 2013. From Property Observer:
Distressed property listings surged 36% in the second half of 2012 on the back of 5,207 companies going into external administration in the first half of the year, according to a new report by Colliers International.
Around 816 distressed properties were advertised for sale across the country in 2012, up by 5% from the 777 properties on the market in 2011…
According to the Colliers report author Felice Spark, there was sharp spike in the number of distressed properties coming to market in the November – 177 properties compared with a monthly average of 68 in 2012 – as banks increasingly brought distressed assets to a more active market.
While Spark expects a spike in the amount of distressed real estate coming to market in 2013, she says a market correction has taken place “with prices now having dropped as low as they can go to support sales”.
“It is unlikely that market conditions will worsen in 2013, but also unlikely that we will see much improvement over the next 12 to 24 months…
Development sites overtook industrial property in 2012 in terms of number of distressed assets on the market across Australia…
On a state-by-state basis, Queensland continued to have the lion’s share of distressed property sales, increasing slightly from 2011 levels and maintaining an almost 50% share of distressed properties nationwide.
Queensland saw a marginal increase of 3.5%, going from 382 properties to 395 properties, whilst South Australia saw an increase of 20 properties to 32 properties.
Victoria witnessed a substantial spike during 2012 of 56%, going from 61 properties to 95 properties…
NSW saw a decline in the number of distressed properties on the market, falling back slightly from 256 properties to 242 properties…
Spark says the banks have now begun pushing through, forcing properties to be put to market…
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.
