Bought for $262,500 in 2003, sold for $95,000 last week

Michelle Singer and Matthew Benns September 17, 2006 ...one-bedroom unit in Cabramatta sold at auction last week for $95,000. In November 2003 it cost $262,500. The mortgagee repossession sale is part of a trend, say real-estate agents and analysts, who are united in the belief falling house prices are more common in Sydney's west than elsewhere in the city. ... prices have come back $40,000 to $60,000 and the talk of interest rate rises terrifies them." "This was an opportunity to buy when the market is depressed...(buyer) as long as the rent comes near or covers the mortgage. Raine & Horne Cabramatta selling agent Vera Wang said: "In a boom-time market, prices go through the roof, nobody cares and nobody holds back. Michael McNamara, from Australian Property Monitors, said: "The drop since the height of the boom in Sydney has only been about 7 per cent, so to get a drop of that amount is highly unusual. However, it doesn't surprise us there's a certain part of the market that has quick sales." Ms Wang said the unit was likely to return $130 a week in rent…She is listing about three mortgagee repossession sales a month…"A lot of people are overcommitting themselves," she said. Macquarie Bank property research analyst Rod Cornish said defaults among mortgage brokers and low-documentation loans were higher than major banks. However, he said Australian Prudential Regulation Authority figures showed the number of loans across Sydney in default with the major banks had begun to rise. "You would expect the price impact on homes would be worse in the outer western suburbs where the rates rises and fuel rises would have a higher impact," he said. Elliott Shiner First National real-estate principal Angela Elliott said: "Everything that is selling now is selling for $40,000 to $50,000 less than it was in 2003. Properties have dropped by a good 30 per cent in value. "You can pick up properties in the Mount Druitt area for $180,000 to $200,000. There are real bargains to be had, but where are the buyers?”