Home prices in areas with a high number of mortgagee sales are experiencing price falls of up to four times the Sydney average, according to a ninemsn study. The top 15 defaulting suburbs experienced a decline in median home sale prices by 12 per cent on average over the last 4 years, compared to the 2.9 per cent Sydney average.
The list of top "mortgagee suburbs" includes: Auburn, Bankstown, Blacktown, Baulkham Hills, Cabramatta, Fairfield, Greenacre, Greystanes, Guildford, Kellyville, Liverpool, Merrylands, Mount Druitt, Prestons and Punchbowl.
Real Estate Institute of Australia president Noel Dyett says sales can damage a suburbs potential sales and nearby properties could suffer as a result.
Mortgagee sales in Melbourne's western suburbs and Queensland's Gold Coast have also risen by up to 25 per cent in recent months, and buyers are warned against purchasing in high default suburbs or risk losing value. Criticism is leveled against mortgage lenders who want a quick sell of the property, rather than holding out for a better price.
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