The number of distressed properties advertised for sale in Australian national newspapers has fallen to the lowest level in several years, which is being taken as further evidence that the commercial property sector is on an upwards trajectory. According to the LandMark White Forced Sales Monitor, ads for only 43 distressed properties were placed in the March quarter of this year. In the same quarter last year, 62 sale advertisements were placed.
The drop in the number of receivers appointed to sell land, shops and offices is due to the relaxing of guidelines from financiers and banks and an increase in the use of empty shops by Internet groups looking to expand into bricks and mortar spaces.
Companies are looking for shops in the suburbs with lockers to be used as a collection point for goods bought online. Australia Post is interested in converting some older post offices, which had been listed in past surveys by receivers as forced sales.
Since the beginning of 2013, the number of properties listed in the national press has fallen. This has been outpaced by the fall in the number of distressed listings. The distressed ratio has fallen steadily from 22 per cent to 14 per cent in 12 months.
Most of the listings are outside of major metropolitan areas and are primarily zoned industrial. That is now changing as the land is being bought up by housing developers.
According to the survey, the distressed ratio in Victoria dropped slightly from 12 per cent in the December quarter 2013 to 11 per cent in the March quarter of 2014. Victoria’s average annual distressed ratio has averaged 10 per cent compared with the previous year’s average of 17 per cent.
