Macquarie Bank property head Rod Cornish said the latest round of completions would be hardest hit by the property slowdown. "These settlements carry a little bit more risk than we've seen previously because the buyers committed later in the cycle, and they may not have had the upswing from when they committed," Mr Cornish said.
But he said tightening rental vacancies and low unemployment meant most investors were not forced to sell, which would prevent any major fall-out.
The Melbourne and Gold Coast markets are expected to be hardest hit by financially stretched speculators seeking to on-sell apartments soon after settlement.
PRDnationwide says that in inner-Melbourne there are 3691 apartments (in developments consisting of 200 or more apartments) due for completion within 12 months.
There are a total of 3891 apartments due for completion on the Gold Coast in the next 12 months, according to the Midwood Queensland Investment Report.
Landmark White senior research manager Vanessa Rader said 1722 apartments were expected to be completed in inner-Sydney in the next 12 months.
PRDnationwide Sydney general manager Curtis Field said while the brunt of the impact from settlements was yet to come, the inner-Sydney investment market had held up much better than many had expected during the past six months.
"Six months ago we were all sitting around the table saying 'this is going to be a bloodbath' - but it hasn't really been that way yet," Mr Field said.
He said apartment prices could come under pressure as some financially stretched investors - especially those who bought through investment seminars - either failed to settle or put properties on the market soon after settlement.
"If sales were made 2.5 years ago then it's quite feasible that they will still value up and still appear as well-purchased properties," Mr Field said. "But if they were purchased in the last 12 to 18 months it's more than likely that the purchase price may fall under what a valuation might be, or you might be more likely to be affected by changes in banks' lending policies.
"It's a line-ball judgment where some people are saying 'I'm better off walking away from the $35,000 (deposit) than being in a world of pain'."
Tony Paskell, operations manager of Sydney-based developer Meriton, said there had been an increase in the number of buyers trying to avoid settlements: "It's because the banks are being a little bit tighter with regards to lending money and because buyers feel that maybe they paid too much so they're trying to find a reason to get out," Mr Paskell said. "Twelve months ago we might have had two or three, now we've got five or six - they're not huge numbers."
He said that while buyers were legally bound to follow through with purchases it was "generally not" worthwhile chasing buyers through the courts.
"If you get to the point where you have to take them to court then it really isn't worthwhile because you would only get to that point when you've got somebody who really doesn't have the money in the first place."
LandMark White Victorian research manager Rachel Kelloway said inner-Melbourne apartment prices - especially at Docklands, where prices had fallen by up to 20 per cent since the peak of the market in July 2003 - could come under more pressure as speculators brought some of the new stock to the market.
"Some of the (Docklands) buildings have been about 70 per cent investors and values have dropped quite a lot because people can't afford to hang on to them," Ms Kelloway said.
"With further interest-rate rises we'll probably see a little bit more activity as people try to sell out - in many cases values have fallen from the time they come to sell from the time they purchased."
However, buyers may have a short-term reprieve with the Reserve Bank unlikely to raise interest rates next week after official figures released yesterday showed inflation was 0.7 per cent in the March quarter - well within the RBA's yearly target of 2 to 3 per cent.
Some purchasers are already trying desperately to find loopholes in the law to avoid settlement.
Property group Mirvac is involved in "mediation discussions" with what is believed to be several buyers who are seeking to avoid settlement on apartments in the fifth tower of its Yarra's Edge development.
The buyers, represented by law firms Slater & Gordon and Jerrard & Stuk, are claiming the tower is not as "golden" in colour as had been promised by the company.
Jerrard & Stuk partner Charles Slidders said the company was representing "more than 10" Mirvac customers.
A Slater & Gordon spokesperson would not disclose the number of buyers the firm was representing.
A Mirvac spokesperson confirmed the company was in mediation with the buyers but would not comment further.
PRDnationwide says 2034 apartments are expected to be completed at Southbank and Docklands in the next 12 months.
Property analyst Michael Matusik, of Matusik Property Insights, said the Gold Coast market, where a total of 3891 apartments were expected to be completed in the next 12 months, could face problems if too many speculators put properties on the market at the same time.
"My concern is a lot of the buyers are speculators and will put those apartments back on the market, which could flood the market," Mr Matusik said. "So there is a danger as too much product comes on the market, that values that have been achieved off-the-plan will be undercut and pegged back."
However a strong "empty-nester" market meant top quality apartments were likely to attract buyers more quickly. "But some of the (buildings) aren't in the best locations - despite being very tall."
He said a healthy tourism market would also help prevent any many major downturn like that of the early 1990s.
PRDnationwide says 1261 apartments are to be completed in inner-city Brisbane in the next 12 months.
Mr Matusik said the Brisbane market faced similar problems to the Gold Coast, but it would be propped up by low rental vacancy rates.
"If you can't sell an apartment on settlement for speculation you could get a tenant in there in inner-Brisbane and the then you can take some time to sell."
