All Topics / Help Needed! / Best advice : Don’t invest into property : The australian market is CRASHING.

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  • Profile photo of blogsblogs
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    ormeau wrote:
    Millionaire shmillionaire, it all wont matter soon guys. Peak Oil, coming to a service station near you!

    Egzackery!! Cash is King!!

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    blogs wrote:
    ormeau wrote:
    Millionaire shmillionaire, it all wont matter soon guys. Peak Oil, coming to a service station near you!

    Egzackery!! Cash is King!!

    Cash is risky in an inflationary market some would advise against holding cash during inflationary times.  Weimar republic and all that.

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    Yeah I realise that, though at least you dont risk loosing it-should at least kep step with inflation. Stockmarkets are heading for the gutter, property markets following….interesting times ahead…..

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    Well I'm right got my investment loans fixed, stocked up on tin food, dug the shelter out the back and doubled security.

    Seriously though the US will slide big time, the UK is toast but I think that it is differenet this time for OZ..  The emergence of the BRIC economies should dampen some of the downturn for us in the lucky country.

    I have watched some local energy shares double in the last 8 weeks though.

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    The Great Oil Swindle

    How much did the Fed really know?

    http://www.informationclearinghouse.info/article20011.htm

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    Did not anyone read this ?

    http://www.news.com.au/business/money/story/0,25479,23758574-5016110,00.html#add-comment

    The survey of 2331 respondents conducted on March 10 to 18 found more rate rises cold force some people to the wall. If there was a further 1 per cent rise in interest rates, almost half or 47 per cent of property investors said they would be forced to sell their homes.

    Of homeowners, one in three said they would sell if the rate rose another 1 per cent

          

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    rates will rise by 0.5 percent this year, and keep going up , and up and up. There's 0% chance of them going down. Oil prices add to the pressure, as inflation is up up up, so interest must go up up up to 13% base rates minimum, which means 18% variable rates.

    These are interesting times, especially when you think a lot of property investors have 20 (!!) properties or more, all NEGATIVELY geared of barely above 0 at their fixed low rates that will jump to 10% in september.
    If those all come on the market, it's carnage like noone has seen before. 80% house price crashes , and houses abandoned because they are too expensive to upkeep.

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    Its okay, we are all saved! Kevin Rudd has asked OPEC to increase oil production (guess he thinks he has a better relationship than GW) and he is going to change the government car fleet to hybrids! Yeh Yeh 3 cheers for Kev :-)

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    ormeau wrote:
    Its okay, we are all saved! Kevin Rudd has asked OPEC to increase oil production (guess he thinks he has a better relationship than GW) and he is going to change the government car fleet to hybrids! Yeh Yeh 3 cheers for Kev :-)

    lol the guy is a complete joke!! If he was really concerned about reducing fossil fuel use for starters he wouldnt be jet setting around the world burning thousands of tons of jet fuel when he could do tele conferences with video just as effectively from Canberra. I wonder how much grenhouse gases were expelled from all the people who traveled to his big chin wag session….wonder if he knows what a hypocrite is?

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    blogs wrote:
    ormeau wrote:
    Its okay, we are all saved! Kevin Rudd has asked OPEC to increase oil production (guess he thinks he has a better relationship than GW) and he is going to change the government car fleet to hybrids! Yeh Yeh 3 cheers for Kev :-)

    lol the guy is a complete joke!! If he was really concerned about reducing fossil fuel use for starters he wouldnt be jet setting around the world burning thousands of tons of jet fuel when he could do tele conferences with video just as effectively from Canberra. I wonder how much grenhouse gases were expelled from all the people who traveled to his big chin wag session….wonder if he knows what a hypocrite is?

    I see a trend emerging….I try to read widely…..and the words hypocrite and Rudd keep appearing together relatively frequently …. he seems to be having a shorter than usual honeymoon period …. I fell a little guilty saying this as I am in a working family

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    Its okay yarpos, perhaps only 01% of the Australian population really have a true idea of the ramifications peak oil has on mankind, we are literally stuck up a culdesac in an SUV mate. Do the research, I plead with all of you guys here to take a few hours out and read up on what i know, i bought gold less than 2 years ago, 3 kilos of it, sold it for $1000 US, and there is more and more ways to make some good coin from the coming economic collapse.

    The end of suburbia is coming, and it only has a lifespan of 70 years, think about that for a moment, not all is what it seems.

    http://www.latoc.com

    Cheers

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    Sorry to put a spanner in the works but I think the whole carbon trading scheme and tax is one big massive con.

    Profile photo of Jon ChownJon Chown
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    Scamp says,

    rates will rise by 0.5 percent this year, and keep going up , and up and up. There's 0% chance of them going down. Oil prices add to the pressure, as inflation is up up up, so interest must go up up up to 13% base rates minimum, which means 18% variable rates.

    These are interesting times, especially when you think a lot of property investors have 20 (!!) properties or more, all NEGATIVELY geared of barely above 0 at their fixed low rates that will jump to 10% in september.
    If those all come on the market, it's carnage like noone has seen before. 80% house price crashes , and houses abandoned because they are too expensive to upkeep.

     We'll all be rooned," said Hanrahan,!!!!!!    Scamp you really are a joke.

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    Wow John, thanks for your insightful comments…

    Can you tell me what impact you think a lot of fixed rate mortages of 5% or whatever it was back in 2004 will have on the market when they finish and have to be refinanced at current levels, effectively doubling repayments?? Combine the added costs of living surely you would agree that 'avalanche' of properties for sale might not be out of the question?

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    Time will prevail itself…. No point arguing about the future

    Profile photo of Jon ChownJon Chown
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    Well Brogs,  I'm not for one minute suggesting that there won't be anyone who is not going to suffer from rate rises, that in itself would be stupid, however to suggest that 80% house price crashes is just ridiculuos.   As with any commercial transaction if you over extend yourself you will pay the consequence.

    Lets look at some statistics.   Of the approx 7 million properties in Australia 2.6 million are owned outright (these people should not be troubled by rate rises) a further 2.4 million are owned with a mortgage (a significant portion of these mortgages have been in existence for over ten years and it is unlikely that they will be deeply troubled, however those who have purchased in the last five years and who pushed to the limit of their purchasing power (as most people do) there will be a high degree of hurt and unfortunately repossessions will occur.   When this does happen and the people are forced out into the street they will have to join with the rest of the people looking for one of the 2 million rental properties available in Australia.   As has already been reported this Supply/Demand scale is already teetering to the Landlords benefit and if a large number of people are forced to quit their homes then either the Government or the Private Sector has to provide housing.   Some form of balance must prevail.

    It's time some of the hurt was felt by the Tenants as the home owners and Investors have been carrying the can for most of this recession to date, and if rents rise to the level that I believe they should be, we will see some of the smarter people who are cashed up re-enter the market and provide this housing.   Life will go on, we are creatures of survival.

    Profile photo of Jon ChownJon Chown
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    Scamp says.
    These are interesting times, especially when you think a lot of property investors have 20 (!!) properties or more, all NEGATIVELY geared of barely above 0

    According to the ABS of the approx 2million Investment properties in Australia, 90% are owned by people who have only one investment property and less than 1% of investors own in excess of 10 properties.

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    John, you mention percentages of houses that are fully owned, or mortgaged over 10 years ago, but surely you would realise that these are not what will affect property prices. Just as people value there house value on properties recently sold and jumping up and down with joy, when they get sold down should this also devalue their properties? Just in the same way as a small proprtion of sales has recently 'increased' their values? Cant have it both ways….

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    Jon Chown wrote:
    Scamp says.
    These are interesting times, especially when you think a lot of property investors have 20 (!!) properties or more, all NEGATIVELY geared of barely above 0

    According to the ABS of the approx 2million Investment properties in Australia, 90% are owned by people who have only one investment property and less than 1% of investors own in excess of 10 properties.

    20.000 people with more than 10 properties. That's quite a lot if you ask me, especially if they get into financial trouble. And remember : 1000 houses collectively selling for 50% of the houseprices can bring down your houseprice to 50% also. All you need for the market to crash is a lack of buyers. Well.. if you look at todays market, there's not a lot of buyers out there. No more free equity due to the new ABS figures means that the freebooter investors are out of the game. That's 30% of the market. Then there's the pensionists who are in deep trouble also , that's another 10%. There's the average families with credit cards with deep financial trouble and extremely high oil prices, that's another 30%. Then there's the FHB's who can't get a 105% loan anymore from banks, that's the last 30%.

    Where, if you would be so kind to tell us, will you get buyers from ?
    No buyers = no sales = lower houseprices = still no sales = 30% houseprice crash = still no sales = 60% houseprice crash = yes.. the FHB's can buy again.

    Sydney houseprices have already dropped 35%, please give any good reason why other cities won't follow ?
    ( brisbane is down 20% btw.. I see you're in brisbane, you should know this ? )

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    blogs wrote:
    John, you mention percentages of houses that are fully owned, or mortgaged over 10 years ago, but surely you would realise that these are not what will affect property prices. Just as people value there house value on properties recently sold and jumping up and down with joy, when they get sold down should this also devalue their properties? Just in the same way as a small proprtion of sales has recently 'increased' their values? Cant have it both ways….

    Hm.. another way to read this is : 90% of the investors have no idea what they're doing. ( having only 1 investment property they obviously aren't earning their salary with it , which means they do it 'beside their own job'.
    The 90% property investments are owned by amateur investors is very scary, especially because it's these people that are having a hard time now with mortgage interest rates resets and high oil prices and unemployment rising.

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