A waterfront house on Newcastle's Lake Macquarie was valued at almost $1m by banks 18 months ago was this week listed for $780,000.
Owners Glenn and Karen Mahoney, who also borrowed against the house to buy shares, will lose at least $60,000.
And at Kentlyn in Sydney's south-west, the owners of a seven-bedroom house who knocked back an offer of more than $1 million 18 months ago have relisted for offers above $800,000.
Do At Marks Point, Ms Mahoney said she was desperate to sell her family's renovated two-bedroom cottage with direct access to Lake Macquarie.
Ms Mahoney said the family had invested about $850,000 in the waterfront cottage bought for $550,000 as a deceased estate in 2005.
"It was basically a knock-down that we've restored and renovated," she said.
The family are victims of the double-whammy impact of rising interest rates and falling share prices.
"The bank lent us more money based on valuations of close to $1 million. Our financial adviser advised us to invest in shares but now share prices have fallen and the interest is costing us thousands of dollars a month," she said.
Ms Mahoney said the sale was no longer about how much money her family would lose, but preventing further interest rate expenses.
"Our interest rates have risen from 5 to nearly 10 per cent. It's a mortgage melt-down for us," she said.
Rising interest rates had also created a "tough market" for high-end sales in the south-west, Professionals Campbelltown agent Chris Halloran said.
While lower end sales had remained active, Mr Halloran said sales of more expensive properties were very slow.
"A Kentlyn property we had an offer of more than $1 million on about 18 months ago is still listed for offers above $800,000," he said.
A three-bedroom townhouse at Toongabbie purchased for $338,000 in 2004 is now listed for $309,00.
At Newington a unit bought for $478,000 in 2003 was listed for $400,000 in May. At Pymble a unit bought for $725,000 in 2004 was listed at $685,000.
