A SLUMP or a crash? That was the question confronting the property market yesterday.
While the latest edition of The Economist predicts a global property crash, others are not so sure.
The head of Aussie Home Loans, John Symond, said a 10-15 per cent drop was more likely, averting a severe crash.
But Wizard Home Loans executive chairman Mark Bouris declared yesterday there had been a significant plunge in investment lending.
http://finance.news.com.au/common/story_page/0,4057,9011393%255E462,00.html
Regards,
ElvisI read the article. Just the same ole stuff the newspapers like to recycle.
I do believe prices will stablise or go down a little over the next 2-3 yrs. I am a long term investor so I am sitting tight and consolidating now.
I;m with you yack. I’ve seen the predictions Steve showed us at the seminar from the papers of yesteryear and it’s laughable!! I’m still investing now, for sure, only not in countries said to be ‘overvalued’ and most likely to get a correction should one occur. And Australia is one of them as is the UK, Spain, USA, and some others.
I have invested on Gold Coast recently and have noticed, prices are still increasing, with buoyant demand.
Different to Melbourne, where I currently live. Still think there are good opportunities there, even in this slowing market. You just need to be a little smarter to source them.
James
GeorgisJ, I think that with Q’land in general, you just can’t go wrong. i think that place is going to defy all the predictions no matter what happens in the rest of Aus. The projections are just huge for Qland. it’s about the growth they expect for the next 30 years, the thousands of jobs that are going in, all over the place. The growth corridor, the eventual population of the whole triangle Brisbane/Gold Coast/Ipswich, it’s the fact that PEOPLE will want to move there. Like they already are. Isn’t it like over 1000 people a day move there? It’s supposed to become the biggest southern hemisphere urban area by 2050, or something –
just humungous.I actually don’t even know the area that well, certainly never been to Ipswich, this is just from reading, and a long chat with a millionaire investor couple who now control 8 mill worth of property, and they only started 3 years ago.
They know the area backwards.cheers-
MiniMini,
I agree (not surprisingly). Whilst there will be cyclical influences like the rest of the country, the population movements alone will drive land values upwards moreso than any other area.From 1975-2000, the GC population has increased by 279%. Similar predictions are there for the next 25. Admittedly this is much longer term in focus, but I can not see the fundamentals for investing in area better than the GC.
Hervey Bay, Logan, Joondalup & Shire of Caboolture have very bullish population growth, infrastructure planning and jobs growth.
A very strong concensus is the continued growth in the next two years throughout Qld by many ‘so-called’ experts (Of course they have been known to get it wrong!).
James
Hey james,
a friend’s mum who lives in Q’land was telling me she had a huge vibe for Logan about a year ago, which was a place people would warn you against, like, bigtime, and seems she was right. Her husband wouldn’t let her invest there though.
*sheesh*but you should have heard the people slamming Logan around here, a year ago.
they would all be laughing all the way to the bank if they’d bought a year ago – it was quite cheap then, is it still or has it moved? i bet it’s moved.What i get from all of this is that you have to be a leader, not a follower. it takes confidence to be ahead of the pack, you will for sure get detractors if you go out on a limb away from the munters.
but just do your numbers and go for it anyway, I reckon. Most of the detractors in my experience don’t know how to do the numbers anyway.
cheers-
miniand when the ‘herd’ figure out it was actually a bloody good idea and try to do what you did it doesn’t work as well because prices rose already…
Mini,
Is that the Irwins you’re referring to? Brenda Irwin and her hubby have bought up hugely in that area, and have had articles written on them in the last two editoins of the API magazine. She’s also a lovely woman and people can chat to her, or PM her on the somersoft.com forum- she’s very accessible. She ias also into CF+ props, so she would have similar aims to many of the people on this forum.
Seroiusly, when I look at the prices of QLD, I am wondering if it is going to overtake Melbourne (don’t hit me yack!) in terms of RE, and price. The prices aren’t so different now, and if this bullishness and immigration continue in Qld, then I reckon there’s a likelihood. What do others think?
kay henry
Re QLD:
My Brother is an electrician for MERITON and they are pretty much stopping or slowing down all new development works in Sydney areas and moving up to QLD. Somthing about the Qld government not wanting any money out of em for their buildings i think (perhaps the Comunity Contribution???)
He only told me this a few days ago actually, very interesting i would think!
Jason
Don’t tell me our friend Harry Triguboff doesn’t want to contribute to the community Jason! Now all my dreams are shattered… hehe. [hmm]
Jason, if you look at this weekend’s Domain, it is about as big as a weekend edition of the Daily Telegraph- it’s a whopper! And the first few pages are full of Meriton skyscrapers. The guy is gonna have to wait a while to sell all those babies.
I wonder where he’s gonna build all his tall buildings in Qld- isn’t there already one Gold Coast?
kay henry
My 2c
Every area works in different cycles… and the ‘ripple effect’ does come into play as outlying suburbs have ‘value added’ due to the higher prices of the suburbs next to them..
And whereas one State,Territory,Region,City,Town,Suburb or Shack may be Down, another area may still be rising…
Hey MINI..You meet some interesting people[biggrin]
Kay.. see if you can Get Brenda Irwin to Visit our little Forum..[thumbsupanim]
REDWING“Money is a currency, like electricity and it requires momentum to make it Effective”
My 2c worth:-
When the supply of something is limited (beachfront developable land/ shortage of lifesaving medicine) the price will be bid up by rich people, not bid down by poor people.
With huge population increases to sydney and qld, their re can continue to increase, and once it gets to a certain value, the old gets smashed down, duplexes will be built, or townhouses or multistory apartments.
(btw I was nearly born filthy rich- one of my distant relies owned 1100 acres (yes, 1100 acres) at blacktown- wouldnt have minded a slice of that pie!- but apparently his son lost the lot[confused2][glum][thumbsdownanim)
Thus, when I hear that rental yields are at an all time low, surely this just means that sydney is about to be developed more, by building up, not out?
But as for states that have static populations, this low rental yield could have much more dire problems if the bubble (or overvaluation) is burst. Any comments?
Wrappack, if low yields and capital gains usually go together, then so do high yields and little or no CGs.
but at the moment in Sydney, you have low yields and capital loss or no gains, and where i’m buying – small town, NZ – you have 16 percent plus yields and capital growth. Surprise surprise. Cafes going in and all the good signs.
Think ‘Berri, NSW’ for the vibe.So if rental yields in Sydney are at an all time low, and there might be no capital gain or capital losses for a while, then investors shouldn’t be buying in Sydney and the like for now, right?
As far as developments go, the millionaire couple i mentioned before who aren’t brenda Irwin, however they were in api magazine recently i think, said that new developments being offered at new development prices push the prices of the surrounding existing housing up. So in other words it can work to buy near where you hear developments are going to happen.
cheers-
mini
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