AussieHousePrices wrote:
You keep saying that you’re not implying that good areas won’t fall.  So what is the point of the above sentence?

Well, you ain't reading carefully before putting words in my mouth. Let's bring up a fictitious example for the purposes of discussion: there are 10 people out there who want to buy a 15 carat diamond, of w…[Read more]

melbournite wrote:
My two cents worth… whenever there is talk about whether Australian property prices are in a bubble, those with vested interests always say we are not in a bubble, so prices will just stagnate at worst (best?).

Now I had to chuckle when reading this one. That looks like a half-finished sentence. If I may continue from where…[Read more]

AussieHousePrices wrote:
It’s clear from other countries that property booms can and do end in busts. I would need a good explanation of why that’s not possible in Australia. Otherwise, I’m going to assume that we’re no different.

Of course asset booms of any sort can end in a bust, and of course it's possible in Australia. What I was hinting…[Read more]

It'd be difficult to assess the situation from here since none of us get to see what your house really looks like and what sort of condition it's in. The cleanliness of a place or the neatness of the lawn is a subjective thing. For example, we could have a very lax landlord who believes 'reasonably clean' still means there is junk in the backyard…[Read more]

hschmid wrote:
He might believe that the same $ could be more profitable in the business than in bricks and mortar.

Good point. To have a better chance at convincing him that property may be the way forward, you will probably have to study his business, the profitability, all the figures, the risks and potentials. Then this needs to be compared…[Read more]

Scott No Mates wrote:
Fword, we have had that correction. Being a mug punter, I look at very simple stats & focus on my local area. Analysis of resales of properties bought in 2007 (pre-gfc) reveal about 6-7% growth over the 3 years excluding CPI, so we have gone backwards. However 10 year average growth is over 8%. What's worse, the median…[Read more]

xdrew wrote:
People cant compare Japan to us, their crash was different. And the US crash is caused by a severe problem exacerbated by the 'housing affordability mob'.With Japan there were loans organised that were 90 year loans, deferring risk of actual final payment of the loans to your grandchildren or worse. This allowed people to borrow…[Read more]

Wynyard wrote:
"Just out of interest, what is the weekly rent of a place in this slumsville part of Preston?"$310-350pw. Same as the nice area just a few blocks away.

Geez, at that kind of rent for the 'slumsville' you describe, I'd be looking elsewhere.

Wynyard wrote:
I'm not talking about no blue ribbon suburbs. As I said, a lot of Preston…[Read more]

AussieHousePrices wrote:
Agreed.  But non-cash expenses are dwarfed by cash expenses.  So, the only way that tax can turn a cash flow negative investment into a cash flow positive one is if it was on the verge of becoming positive anyway.

That's besides the point. The point I was trying to make is that is is not entirely correct to suggest t…[Read more]

AussieHousePrices wrote:
Hi Wynyard.  My guess $460,000 now.   About half that in 7 years.

In seven years time, we'll hear a roar of laughter coming from somewhere. Someone is going to be very wrong.

Wynyard wrote:
Also, to her credit, it's a nicer part of Preston, because just a few blocks down the road and you're in total slumsville, I checked out some houses there too, and it reminded me of my time living in commission houses – not pretty, freaky neighbours, bikies, neglect, a feeling of oppression that hangs in the sky. Its not the place…[Read more]

AussieHousePrices wrote:
fWord – you were the one that said the majority of investors are in the business of capital gain.  And in recent times, I would agree.

Sorry, you've got me confused here. Which statement are we referring to that leads you to bring up this point?

AussieHousePrices wrote:
…many property investors don’t realize that…[Read more]

JamesSampson wrote:
I have friends who say what the media tells them, that property is unafordable and out of reach. I believe what the article says that they can afford property they just cant afford the property they want.

This is an important point that I wished more would-be buyers would try to understand. Truth of the matter is that they…[Read more]

AussieHousePrices wrote:
Investors focus on the potential cash flows of the investment (e.g. rent / profitability / dividends).  Of course, they might also hope that the value of their investment will go up as the potential future cash flow improves.   Speculators aren’t as interested in the potential for cash flows. In fact, when it comes to p…[Read more]

AussieHousePrices wrote:
If that’s the case, they are not investors, they are speculators and many will get burnt when capital gains dry up.  When people are buying simply because prices are rising, not because the investment is sound, that is a pretty good sign that there’s a bubble.  It’s the greater fools theory and it works – as long as y…[Read more]

When we talk about 'perceived value', shouldn't we perhaps ponder over the 'perceived value' of money itself? After all, are sheets of plastic and bits of metal really worth that much?It might boil down to supply and demand. If people continue to want to live in certain areas, the prices there will probably rise. For example, I'm unlikely to give…[Read more]

Paullie wrote:

Shelley D. wrote:
Tip I send my tenants a $50.00 gift voucher every time I get a good inspection report or after tax time – They love it and I love them for looking after my property.

Is that tax deductible? lol

It is, I suspect, considering it's a gift to tenants.

AussieHousePrices wrote:
One other thing fWord, we get bombarded with claims that prices always go up, and advice that if we don’t buy now, we’ll be priced out forever – from the media, from the property industry, the banks and even from friends and family. You might not have declared your beliefs but everyone else has! So I think it’s unfai…[Read more]

AussieHousePrices wrote:
I agree that landlords are not out to sqeenze tentants dry. But I also wouldn’t call them ‘generous’ for providing a roof over people’s heads. Investor’s are (rightly) in it for themselves and they simply get the best rent they can, as the market dictates.

Then it is the market dictating the cost of renting, is it not…[Read more]

AussieHousePrices wrote:
It is possible to have a view of where the market will be in the future while understanding that the market isn’t there yet. Think of it this way, if you think your investment property will double in 10 years, would you try to sell it for double NOW?

Good point. I'm not trying to sell a house for double the p…[Read more]