On Friday as managers, planners and brokers across the country were fielding calls from distraught investors and close to retirement boomers fearing a future diet of Pedigree, a North-West Tasmanian real estate office was offering advice contrary to their equity market slinging cousins - Jump!

While the equity market message was "don't panic and sell (I can't afford to lose more clients)", the message coming from Saunders Property suggested they'd rounded up some confused vendors and their stale listings for a dose of reality - "get out now, or it will be a bigger hit later."

Nearly 20 properties were stamped with "Clearance Price", having their prices adjusted downwards and towards reality. From the meagre and less realistic - a 4k discount on the ultra-modern and obnoxious, to the bone jarring - 140k slashed from a tea and scone property with acreage. Almost 650k, for an average of over 35k per property was lit up, with embers of housing equity floating off into the night sky.

For investors in Burnie, where 21% of listings are investors looking to evacuate the city, the news of several houses in the mid 200k range being dropped to the low 200k range, is a singe to the bum hairs. If well maintained and better positioned homes start dropping into the price range of investors' poorly maintained and poorly positioned rats' nests - dumps stinking up the market with their noxious facades for over half a year - the market has little alternative but to shift itself downwards.

The previous sales data on some of these properties shows they're regressing back to prices they previously sold for in the mid part of the 2000's. Debt is a dirty word and confidence has been crushed, so it's bad times ahead if you're sitting on one of the innumerable empty specs still bogging up the market.

The only salvation for many builders is a doubled edged sword - the drop in housing approvals. They might not have any work, but fewer new houses coming online means more chance of offloading some of their constipated supply.

Now sure, there seems like a few good deals beginning to weasel their way into this blog, but before anyone proclaims the affordability of some of these properties, keep in mind several things - the region featured in this post is home to possibly the poorest electorate in the country and the median income across the area barely squeaks above 40k. So even at $199,999 you're still looking at nearly 5x income.

But at the moment, is that the indicator we should be really looking at? It's late 2008 or early 2009, yourself and girlfriend, Lucy, are all randy to hump a house with the aid of the first home buyers' boost, the one the pleasant faced, doe-eyed, Tanya Plibersek has been selling you on the TV. You find, as Saunders calls it "A Perfect Starter in Premier Suburb", it's going for $250k. You leap in because there's free money and houses only go up - then fast forward to 2011, Saunders Real Estate is having a real estate clearance and several similar houses in your suburb are slayed by 40-50k, pre any actual sale.

Pray for three things - Lucy's pregnancy test doesn't show an extra line; work doesn't keep slowing down; more stimulus.


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