I think that it is ludicrous to suggest that prices are dropping in this area.
Just last week, i saw a unit advertised which is in the same block as one I bought only five months ago.
They are asking 30k more than I purchased it for. I know this is only the asking price, but even if it sells for only 20k more than we paid, that is an extremely quick 20k in equity, and a good indication that prices are not going backwards...
I am yet to see a single property example that clearly demonstrates that prices are actually dropping in Frankston. The values have stabilised.
There is a lot more stock in the market currently off the back of a series of interest rate rises.
This means that buyers have a lot more choice today than 2-3 months ago. The sales activity levels also show the lowest number of properties coming across as "under offer" under realestate.com.au listings for the area since I started tracking activity levels 12 months ago.
Out of first 200 listings available at any given time, the number of "under offer" properties has hovered around 70 prop (which means an extremely buoyant market or a sellers market) and reaching 90 at its peak. Currently it is around 30.
Most properties were getting sold within a week, infact more than 70% of properties priced correctly sold within 48-72 hours. This has changed now, albiet temporarily.
Considering that majority consensus is for interest rates to stabilise and showing downward trend in 2009, Eastlink opening around June and API conducting a major feature on Frankston in May edition, I can guarantee that this lull in the market would be a thing of the past for a while -come late May/ June.
I expect to see very significant investor activity around May, intensifying around June and getting strongest in the second half of this year. Strong activity decreases available stock, creates demand and competition and directly results in upward pressure on property values.
Harris