Low-end property prices to fall 10 per cent

There will be a steep fall in house prices at the low end of the market as the first-home buyers grants come to an end, a new report warns.

CB Richard Ellis has unveiled a new report to coincide with figures from the Australian Bureau of Statistics showing that the number of property sales seen in May was 29 per cent higher than in October 2008.

In its new study, CB Richard Ellis claims that first-home buyers were responsible for 95.2 per cent of this rise.

"The fact that first-home buyers have been driving this boom leaves the sub-$500,000 market particularly vulnerable once the boost is reduced from September 2009," said the company’s manager of residential research Erin Rolandsen.

Earlier this month, the organisation announced that intense interest from residential buyers in Sydney has led to the sale of land on Church Avenue that has been earmarked for development of 35 new properties.

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