Sub Million Dollar Houses

As a follow-up to my Million Dollar Houses blog I thought I'd extend my research a bit because I wouldn't want to be accused of focusing solely on the high-end stuff, which of course is potentially not reflective of the real world.

So, I grabbed the lastest copy of the Courier Mail's Property Section and logged on to www.realestate.com.au and set to work. According to the latest CM there were 33 sales (including houses and units) over the $500k mark in the past week (Apr 2nd to Apr 8th) across all Brisbane and according to the aforementioned website there are 631 properties for sale in the Western Burbs and surrounding areas alone in the $500k+ bracket. Referring to the Recent Sales Results page in the CM, the total sales in the Western Burbs in this segment amounted to: zero. When you include the surrounding areas (Fig Tree Pocket, Taringa, St Lucia, Indooroopilly, Tennyson, Yerongpilly etc) the total sales in this bracket amounted to: 3.

At that sales pace, it would take in excess of 4 years to clear the existing inventory alone. I'm going to stick my neck out at this point and suggest that many of these sellers may not be willing or have the capacity to wait that long and will need to engage with reality sooner rather than later and drop their prices - probably quite significantly. This will eventually re-price the entire market.

I know the above is "research" is not particularly scientific and I know that some sales don't make it to the Recent Results section of the CM's Property section (why not, I couldn't say -- you'd have thought that with housing sales now about as rare as a white truffle in K-Mart, that spruikers would be shouting every one from the rooftops), but by the same token, not every property that's for sale appears on realestate.com.au, so we'll call that one quits, I think. In short, there's enough in these stats to give an accurate picture of the market today.

P.S. In my Million Dollar House blog I challenged the assertion by some local agents that there are 148 properties for sale over the magic $1m mark in all of Brisbane and thought the number was closer to 1,000. This morning, consuming all of about 36 and a half seconds of my time, a search on realestate.com.au reveals there are in excess of 739 properties for sale over $1m. I must confess, I was somewhat surprised that this number was that low, so I delved a little deeper and discovered that my Brisbane City - Greater Region search actually only covers the CBD and inner Brisbane suburbs i .e only as far west as St Lucia (for example). I'm cannot find a way to do a single broader search on realestate.com.au that covers the outer suburbs as well but my estimate of 1,000 properties over the $1m mark now looks somewhat light. As I mentioned recently, there are 200 properties in the Western Burbs and surrounds over that mark alone. These numbers are worth keeping an eye on over the coming months because I fail to see any catalyst that would drive a spate of buying to start clearing this inventory. Even if there was a willingness to do so, it looks very much like the market's severe unaffordability is finally beginning to tell.