Are we starting to see more distressed vendors than may have been reported? Australia wide, the delinquency rate has climbed from around 1.4 per cent to 1.79 per cent. It may be low in comparison to Europe and America, however it’s a figure the reserve bank should be paying close heed to because it seems there are other distressed vendors flying under the radar and trying to bail out before they get to the delinquency stage.
The average time Australian’s stay in their homes is 7.5 years (RPData) – although in the established suburbs of Melbourne – close to the water and city – it’s 9.1 years. However there seem to be increasing numbers of vendor’s selling prime real estate after only 1 or 2 years of residence – (something I’m seeing more and more often when I research the sales history of homes). In many cases these homes are struggling to sell with days on market stretching into months as vendor’s try to achieve their ‘wish price’ (a return on investment) in a flat conditions. These are often people who purchased when interest rates were low, and now rates have climbed, find themselves laboring to make the repayments.