the market cycle

I am living in Perth using the FHOG and I am finding it very difficult to compete. I have been looking for about 6 months now and we just have too much buyers with not enough homes to buy.

Some homes are just too over valued with the sellers taking advantage.

I have look at homes that no one wants and try to get a bargin there.

Hong Tran

I could not agree with Michael more. It amazes me that people buy when the market is booming and yet when the market levels or drops every one stops buying. If there is another boom by the end of the decade even if it is not as big as the one we have just had, it makes since to buy now and you will reap the benefits when the next boom happens. The great American industrist John Getty once said that he buys when everyone else is selling.

Nigel Kibel

http://www.propertyknowhow.com.au

Australian and New Zealand The United States Property Researcher and education
One Day property investment research workshop The United States. Please register your interest

I believe that investment cycles in real estate can b compared to other areas of investing as well.

In the stock or share markets we see people making profits in up cycles – side ways cycles and downward cycles.

Many big developers are nervous in upward trends because they know there will always b a correction – the question is when. Its easy to predict the past but harder to predict the future.

However – with study u will see people making profits in a variety of areas – developing, renovating, trading, cosmetic renovations, DA approvals and onselling, simulatenous settlements, rezoning, duplexes, town house sites, flicks etc etc

The truth is all markets change what ever business you are in and nothing is certain, wars, interest rates and many other out side influences will effect our investments.

At the end of the day when we retire we can only hope that our investment out come has lead us to a dignified retirement – good luck to u all.

resiwealth

Redwing – Just wondering, as I’m still on L plates. I understand re-having IPs revalued to determine how much equity you have in them.

But what do you mean when you say you’ll “top up loans and THEN access equity”?

Also, I gather that you and Derek are in Perth, where the market’s still rising. Are you waiting for it to plateau before purchasing?

thanks,
Carlin

Looking in Nth West Sydney for around 4 mths, and no sign of leveling here.

Compare a 800k property 6 mths ago to current stock offered and you get a lot more for your buck. Whole new suburbs open up.

Move up to 1M+ and the viewing gets even better.

Am I buying sure, but not till I see em cry.

Figure we have over a year to go.

I have been looking at properties in the Brisbane market for the past 6-9 months. I can honestly say the market is over-priced.
The boom we have experienced in the past 4-5 years will not come again for a considerable time: in fact it will get worse.
Short-term property investors don’t need to worry until around 2010.
(or just before), s[buz2]o do your business before this date and then move your wealth into gold.
This is when the U.S. Economy may just collapse. If you carry a lot of debt around this time, or you have assets in just one area, namely the real estate investment sector, you will be in a lot of trouble.
If you need further proof of the trouble the U.S. is in then do some research….and just remember that any country currently heavily invested in U.S. debt….(bonds) will also be bought down as well.
Australia can’t rely on mineral exports forever! Be smart and look at the macro-economic situation……16 years of economic expansion is where the balloon is…..don’t wait for it to pop.

i have to agree, its definitely a buyer’s market. My local area (liverpool, NSW) there are about 10 properties on sale within 5 mins walking distance from my house.

I’m only new to property investing, and wondering why are so many people are selling? are the markets going down? prices falling? whatever it is, i’ve must of missed it

could someone inform me?

thanks
nuggen

Kriscot,

Interesting post – thanks. Gives us all some food for thought.

My opinion on PI is that if you purchase a good enough investment, and you’re buying for the +CF rather than the CG, then it really doesn’t matter too much where the market is or what it’s doing. Clearly if prices go up significantly you would consider your options regarding whether to sell and lock in profits, but if prices are stagnant it really doesn’t matter as long as the numbers work for the cashflow. And I guess you have to hope that you’ve done your homework enough such that the price of your property won’t drop too much even in a significant slump.

My view is that CGs are a bonus and often based on things in the market that you have no influence on, but +CF comes down to your own homework. Find a good deal and you don’t have to worry too much about market movements.

Thoughts?

Regards,

Adam

Don’t let life get in the way of living.