House prices - In the doldrums
Auction Alliance estimates that up to 50000 repossessed and foreclosed homes could hit auction floors and the sheriff’s office over the next year. That’s in addition to the 10000 or so distressed properties currently for sale.
With so many more cash-strapped homeowners expected to dump properties they can no longer afford on the market, prices will no doubt come under pressure. Estate agents say average house prices are already down by an average 15%-20% from pre-2008 highs.
SA is estimated to be overvalued [by The Economist] by an equally hefty 17%.
Very similar tone to Australian analysts. It's different here. It will soft land.
Rode expects house price growth of no more than 2%/annum for at least the next five years. That implies a cumulative real price fall of 15%, assuming an average inflation rate of 5%/annum over the next five years.
The luxury end of the market is meanwhile setting records, a trend that pans out across a range of capitals, including London. Big money is still getting parked from abroad without regard to the broader real estate trends.