Prices crash in Sydney

Things are getting pretty serious down south. An article in the Sydney Morning Herald gives a few nasty examples:

1. In 2003 a 3 bedroom home in St Clair sold for $405,000. Last weekend the owners were forced to sell it when they could no longer pay their mortgage. The house sold after they received one bid at auction for $260,000.
2. An owner paid $257,000 three years ago for a townhouse near Penrith. Once again it was resold by mortgagees on the weekend, this time for just $156,500.
3. In 2003 a Parramatta home sold for $736,000, but was recently sold for $541,000. The former owners had a $580,000 mortgage on the home.

People obviously expected property prices to continue to rise, and were prepared to stretch themselves financially to purchase a home. With rising interest rates, and decreasing property values, a lot of people are now finding it tough to go on. It’s a really, really sad situation.