Thoughts on Canberra

Hi Akyboy

A great person to comment on this would be Bill (BillfromOz). But personally, I’d say that prices are over inflated here. I don’t necessarily see them falling but then again I (now) know they have before.

If you want +ve cf then Canberra is not the place to buy. Best I’ve seen wouldn’t break even for several years. But I’m only a rookie, so perhaps I’m missing something.
Sam

Hi,
This is really aimed at Bill. Do you happen to know what happens if you have a line of credit and prices drop? Can you get a margin call as with shares if the price drops significantly?
Thanks,
Luckyone

G’day Luckyone..

I very much doubt it. In 1995 many home owners in areas like Banks etc, owed more than the house was worth. The Banks knew this of course. But could you imagine the panic if they had called in loans or looked for Mortgagors to reduce debt?

They simply sat it out. That is not to say, that if you are heavily exposed with a LOC, that you may not get a friendly call from the bank. But to answer your question…I think you’ll be okay… not like a margin call on Shares.

Cheers

Bill

Bill O’Mara
Real Estate,Mortgages,Share Market Strategies.
[email protected]

I agree with Bill, if you had bought 12 months ago, heck even 6 months ago, you would be doing alright. But right now, with talk of interest rates going up one must think that any price increase here at the moment (say, land in the new Gungahlin areas going up from $210k to $240k which is ridiculous for 500sq metres) must be temporary.

Sincerely,
Mal

I just saw an ad for an apartment identical to the one I sold recently, in the same building, at the same position, 2 floor up. The asking price is $180K more than what I sold for. []

Hi everyone,

Thanks for the thread, as they say.

Akyboy, your question has been answered so I won’t repeat. But it raises other questions.

A good question on the LOC Luckyone, as it’s of interest to me. I had figured on aiming to get a LOC on my PPOR while the values are still high. The purpose of course to have cash in reserve for a future opportunity. I would however need to achieve more than the recent bank valuation after debt consolidation to do so. 80% in my case would require an extra $25K in the valuation.

Bill, I understand all that you have said. However, are you suggesting that a “friendly call from the bank” could occur when dropped values push the LVR above 80%? If so, I only see two options. Either a forced refinance by the bank back to P&I or sell up.

Regards, Phil

For bill.
glad to have been of help. the national library is a great place for all that type of info. i will go in once a month and do the numbers for you. I didnt really see much difference when i was doing it as i was probably doing the numbers wrong. to get 25% increase, did you average the numbers for each month then average those numbers against the amount of months (ie the 4 months worth i gave you?)
enjoy.
shaun

G’day Shaun…

Taking the past 20 Saturdays, there has been 36 columns on average each Saturday. The lowest was in june with 24 columns…the largest last Saturday at 45 columns….87.5% increase from the low to last week.

Preferably add two Saturdays ie. Sat 1 + Sat 2 = an average of 30 columns. Then add Sat 2 and 3 = an average of 29..1+2 2+3 3+4 4+5 5+6 etc and take the average of those two Saturdays.

In doing so this smoothes it out and you get a low of 29 Columns in June and a top of 43 for an average of the past two Saturdays. Realistically an increase of 14 columns on 29 in June… best part of a 50% increase.

I took a lot of samples and at best/worst the Rentals in the ACT have risen by a staggeriung 25% minimum in the past 4 months.

I’ll put money on it… more than 40columns this coming Saturday…give me your odds.

Cheers

Bill

Bill O’Mara
Real Estate,Mortgages,Share Market Strategies.
[email protected]

All you Canberrans that don’t read the Soap Box, we are having a get together at Olims Pub – now taken over by Mercure I think at 2pm on Saturday 22nd November.

Cheers
Mel