Apartment market disintegrating

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From a UBS property round table yesterday:

What we are seeing now is that apartments are increasingly out of the money. That’s where you get settlement issues.

What’s happened to buyers now as they come to settlement, is bank valuations might come in 10 per cent or even 20 per cent below the contract price and the bank is also probably assessing you with more stringent expenses potentially hair-cutting any bonus or commission or other income a bit more.

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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.