Forced Sales and Receiver Initiated Listings Surge in Australia

31% of major investment properties advertised in Queensland Oct-Nov from mortgagee, receiver or administrator
26% of major investment properties advertised in NSW Oct-Nov from mortgagee, receiver or administrator

Listings increased in the year to December by
48% in Queensland
41% in NSW
37% in Victoria

Cut-price homes on the market in Australia as receivers order fire sales

In Noosa this week, new three and four-bedroom homes that last sold for $1.5 million are now in the hands of receivers and have price tags of between $395,000 and $450,000

But Joye want's you to ask yourself if House Prices [are] Set to Soar?

For most of this year Australians have had to read asinine media articles reporting purported experts predicting catastrophically large 20 per cent, 40 per cent and, last week, 60 per cent falls in domestic house prices.

Nothing like opening with an ad hominem. Disagreeing with Mr. Joye is "Asinine". Good to know.

Aussie house prices will have tapered by around 3.5 per cent over the course of 2011.

Yes, but real estate is supposed to track inflation. And the inflation rate to September was 3.5% on the year. That adds up to a loss of 7%. Given that savings accounts in Australia pay 5.5 to 6%, that's quite a difference. (Yes, American readers, Australians get paid to save money. Can you imagine?)

And now we have mounting evidence that the housing market is staging a slow recovery, as I’ve projected in these pages for some time. The key catalyst appears to have been the RBA’s decision to swing 180 degrees from expecting to hike interest rates to cutting them in November and again in December. A low core inflation result from the ABS today would significantly increase the prospect of a third delicious rate cut for home owners at the RBA’s February board meeting.

Wait, you totally admit that access to credit sets house prices? So . . . "recovery" for you is the same as "mounting debt loads" for the country. Noted.

The first tangible signs of the recovery derived from RP Data-Rismark’s November house price index release, which reported a marginal 0.1 per cent increase in seasonally-adjusted dwelling prices.

Ah, I needed a good laugh. Your dream-date-barbie rate cut resulted in a 0.1% increase?

The final nail in the affordability argument is, of course, mortgage rates. The RBA’s munificence has bequeathed borrowers with home loan rates that are now well-below their averages.

I still can't fathom this. In the U.S. where mortgage terms are fixed for 30 years, affordability could arguably be detached from total debt load. (See how well that worked out for us though?) But in Australia where mortgages are fixed for up to at most 5 years, qualifying on payments is a massive trap. Affordability shouldn't change significantly with the interest rate. But here Joye is, encouraging financial suicide. And based on the article above, apparently that's becoming clearer to the banks and borrowers too.

If the RBA cuts again in February, and further thereafter, as some analysts believe they will, expect to see the return of rapid house price appreciation.

You got a .1% increase out of a .5% fall in the mortgage rate? Just what kind of wild rate cut are you expecting here to get rapid appreciation?