Mortgage pain forcing more properties to be sold after just three years

Rising interest rates and unmanageable mortgages are forcing many SA homeowners to sell up in search of a more affordable place to live, industry experts say.

Rising interest rates and unmanageable mortgages are forcing many South Australian homeowners to sell up in search of a more affordable place to live, industry experts say.

It comes as latest PropTrack data reveals the number of properties that hit the market to the end of June this year less than three years after last settling has risen in every South Australian region.

The data shows 16 per cent of all properties on the market in The Barossa, Yorke and Mid North statistical regions that have hit the market were last sold within the past three years. This is up 5.6 percentage points on the 10.4 per cent share of three-year relistings that would usually be on the market during any given month over the past five years of data.

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In the state’s South-East, that growth is 4.8 percentage points, bringing the share of relistings in this year’s first six months up to 17.3 per cent.

The share of three-year relistings is up 4.5 percentage points in Adelaide’s north to 14.7 per cent, up 3.3 percentage points to 12.3 per cent in outback SA, and up 3.1 percentage points to 12.8 per cent in Adelaide’s southern suburbs.

The share of relistings in Adelaide’s central and hills region is up 3 percentage points to 14.7 per cent, while Adelaide’s west has seen a more modest increase of 1.4 percentage points to 12.9 per cent.

Ray White SA chief executive Matt Lindblom said the main reason behind the increase was that many homeowners were no longer able to afford their mortgage repayments because their fixed rates were switching to variable ones.

“There are always other reasons, but the main reason for the increase would be the interest rates,” he said.

“People are looking ahead going, ‘my payments are going to go up’.

“People in those situations, the smarter ones, are getting ahead of it.”

Mr Lindblom said many people in those situations were selling their properties at a higher price because the market was so strong at the moment.

“If people get ahead of it, then they’re in a better position,” he said.

“Don’t put your head in the sand, you are better to get ahead of it.”

Harcourts Sergeant agent Mark Lloyd said many people were just holding on to their homes but any more interest rate rises would push them over the edge.

“There are a potion of sellers where their hand has been forced,” he said. “We’re seeing more and more of that.

“It’s definitely upset a lot of household budgets and it’s put a lot of constraint on families.”

However, Turner Real Estate chief executive Emma Slape said some homeowners were simply selling because the market was strong and their properties were worth so much more now.

Others who had been considering selling for a while, such as those looking to downsize, were also taking advantage of the market.

“Sometimes people just want to simplify their life too,” she said.

“With property prices rising so considerably that would be on some people’s minds.

“We haven’t seen people being forced to sell at this stage.

“We’re not expecting high volumes of forced selling or repossessions.”

Originally published as Mortgage pain forcing more properties to be sold after just three years