Forums / Property Investing / Help Needed! / Best advice : Don’t invest into property : The australian market is CRASHING.

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  • Profile photo of units4meunits4me
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    @units4me
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    Are Scamp's comments re a potential housing crash any more damaging than those who say property will keep on rising?

    I would think not. Everyone is entitled to their view.

    It crosses the line though, when someone with a sales pitch or service to promote, gives their view to generate business.

    Profile photo of BuyersAgentBuyersAgent
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    @knightm
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    Relax, I think its important to hear all views, thats the point of forums after all.  I like hearing the bears and the bulls and making my own mind up. 

    I take the view of investing in a range of markets to hedge against each other.  I own in Kalgoorlie – gold mining town.  Doing quite well at the moment.  Also across other resources and in capital cities.  Its about not having all eggs in one basket.  Even though all my investment dollars are in Australian residential IP's, I believe I still have diversification. 

    BuyersAgent | Precium
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    South Coast NSW Independent Buyers Agent - Wollongong to Batemans Bay and Regional NSW

    Profile photo of gabarbergabarber
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    Scamp……seriously……I've been investing in the Australian property market for 40 years…..your a fool

    I assume you can tell us all when the meteor is going to hit and awaken the new ice age and give rebirth to the dinosuars to?

    Thats the most worthy response your comments afford

    Profile photo of arandompersonarandomperson
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    @arandomperson
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    context: I just signed a contract on a PPOR (unit) and hopefully this time it won't fall in a heap.. I've been watching house/unit prices closly in some parts of Melbourne and although they have definately flattened out and may even ramp down a bit I do not think they will crash. There are too many renters hunting for accomodation, too many people looking for somewhere to live, right now, for this to happen any time soon.
    When I gave notice I was moving out of my rental accommodation last time (a few months ago) there were people in the yard checking the place out the morning it was listed, and people queued up in the agents clamoring to inspect. Areas which previously had a spread out middle/outer suburb now havily subdivided and getting quite high population density to a near inner city feel..

    Profile photo of ScampScamp
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    @scamp
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    My post was made to warn you about a coming crash. It's already happening just take a look at the news items : – Sydney house prices dropped 50% ( this is actually not true, they only dropped 20% )
    – Worst is to come ( talking about the crash )

    Anyway.
    http://www.censusdata.abs.gov.au/ABSNavigation/prenav/ViewData?&action=401&tabname=Summary&areacode=105&issue=2006&producttype=QuickStats&textversion=true&navmapdisplayed=true&&breadcrumb=PLD&

    That's 2006 data. Plenty of houses unoccupied. Plenty of houses , yet there's a shortage.
    If you want the 2008 results, you take immigration / emigration / deaths / births etc… plus 100 more factors and you got your data. And.. wow, no housing shortage.

    the 'shortage' is a rampant lie, as a last resort to stop the crash. In effect, it will make the crash worse : Rudd is about to build more properties even. Crashing investors sell off their holiday homes, their unrented places etc… Australia doesn't have a shortage : it's got a massive oversupply.

    Ofcourse, everyone wants a CBD unit , plus a summerhouse ON THE WATERFRONT. Yes.. then I can see some people 'think' there's a shortage. There's a shortage of Ferrari's too, everyone wants one but they simply aren't enough of them on the road : A shortage ?.. not really.

    I'm not bearish, we're past that point : I'm right.
    It's already happening, just look up news.com.au.
    If you just put your moneyinto property , then I'm sorry for you, because you just wasted a lot of money.

    If you haven't : Then take my advice : do NOT buy yet, save your money, buy later ( January 2009 ) and offer only 30% in January 2009.

    If you buy now, I suggest you ask at LEAST a 60% discount , because that's what we're talking about : a crash. A correction..

    Profile photo of phana007phana007
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    @phana007
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    I've looked up the " A B S" regarding "Housing Finance, Australia, Mar 2008 "

    This is what i have found.

    We In Australia have had a decrease in People taking out new loans. BUT

    We have an increase in outstanding balances. "Does this mean Aussies are not paying off their debt?" Oh Oh..

    Or have I simply misinterrperated this

    QUOTE:

    HOUSING LOAN OUTSTANDINGS

    At the end of March 2008, the value of outstanding housing loans financed by authorised deposit-taking institutions was $718,696m, up $9,357m (1.3%) from the February 2008 closing balance. Owner occupied housing loans increased by $7,282m (1.5%) to $488,436m and investment housing loans increased by $2,075m (0.9%) to $230,260m.

    Bank loans increased by $9,425m (1.4%) during March 2008 to reach a closing balance of $677,374m. Owner occupied housing loans of banks increased by $7,368m (1.6%) to $455,352 and investment housing loans increased by $2,057m (0.9%) to $222,022m.

    Profile photo of L.A AussieL.A Aussie
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    units4me wrote:
    Are Scamp's comments re a potential housing crash any more damaging than those who say property will keep on rising?

    I would think not. Everyone is entitled to their view.

    It crosses the line though, when someone with a sales pitch or service to promote, gives their view to generate business.

    I agree. People with rose-colored glasses are just as dangerous as those from the GHPC mentality.

    I think we are all quite able to hear both sides and make up our own mind.

    Personally, I don't mind if people are trawling for business on the forum as long as they are also adding knowledge and information of value to the debate.

    There are several people here who fall into this category.

    As for Scamp's big warning; I look it as a signal to get the check book out.

    Warren Buffet said; "I buy my straw hats in the winter."

    There will be plenty of cheap property on the market in the coming months, so the investor who has done their research and has followed the markets will know where and when to buy.

    Having said that, I still believe that a nice, but average home in a nice, but average suburb, well located and in good condition will always keep it's value. Why? Because everyone wants to live in one, and can usually afford to buy one. The demand is always there – regardless of the economic climate.

    If you want to go out and seek the more "speculative" types of property which are high end, high rent etc, then yes, you can get your fingers badly burned as there are less people at the top end to rent and/or buy, and a lot of the higher income earners are not that smart with their money – they are good at spending up big with little concern of the future. So when they lose their job, or get sick and can't work etc, or the rates skyrocket as they have done in the last year or so, these people are often the ones who will fall the hardest, and their properties often have the biggest corrections in price.

    Profile photo of Alistair PerryAlistair Perry
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    "Australia doesn't have a shortage : it's got a massive oversupply."

    Absolute and utter garbage!

    Profile photo of KC1KC1
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    @kc1
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    The psychology of fear and greed is surely worth a discussion.

    The fear/greed mentality is pervasive.

    Scamp's ideas about people operating from fear is pretty spot on. Fear of missing out and greed fed by wanting more and more is a strong driver for most people. Your average person knows very little about the cycles of the market and operates from this place and based on how the media plays it.

    It's refreshing to hear someone comment on this.

    What's happening in the UK right now?

    Profile photo of blogsblogs
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    APerry wrote:
    "Australia doesn't have a shortage : it's got a massive oversupply."

    Absolute and utter garbage!

    lol y areckon?? Just wait till the reality bites and a few properties hit the markets. You comment is shortsighted-the fact that there are so many 'armchair expert' property investors attests to the over supply of housing, just wait till they have to selll to see how the supply/demand eqaution works out…

    Profile photo of kum yin laukum yin lau
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    @kum-yin-lau
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    Hi, I vote we bar Scamp from this forum until he says he's walked around the suburbs for a month at least. Otherwise, garbage should remain where he is.

    I know these people. Vera & husband have son Justin aged 35 who should have his own home but procrastinated & had just recently moved back into parents' home. Daughter C is 24 & still living at home.

    Cathy & husband have 2 sons, older one bought own unit, younger one [28] still renting.

    Martina & husband built own house in Morphett Vale 3 years ago, 2 sons then 14 & 11.

    Mihael Loh's 3 children [40s] have all their own homes + 8 growing teenagers, the oldest is 17.

    Let's fast forward 7 years. We have 3 couples from 52 – 70, ALL living in their own homes. Then we have 6 aged 35-42 and 8 aged 18-30 approx.

    We need 14 houses just for this small group of people I know.

    If I offer you $50K for your house, does it mean your house is worth $50K? Nonsense!

    Scamp, I'm a fool responding to your nonsense but I will PAY you ten thousand if you can get a 60% discount on the asking price.

    KY

    Profile photo of units4meunits4me
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    @units4me
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    Easy to say in hindsight, woulda shoulda bought or sold this or that, but the point is about the situation we are in RIGHT NOW.

    Is property going to go up, down or sideways? You make your choices and wear the consequences, good or bad. That's investing. With so much at stake you must think carefully before diving in.

    We can't wind the clock backwards or forwards.

    Profile photo of phana007phana007
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    I've been eyeing an area in Queensland for a while now. "Woodridge" Houses are 279,000 a week ago; I even had a letter in the mail from a Woodridge realestate agent ELDERS stating prices have dropped 10 – 15 % So sellers should be realistic about their asking price.

    But I had a look online today 15 / 5 /2008 An the average new listing has shot up to 310,000 an some realestates are calling these houses a bargin.

    I've looked back to the houses which are 279,000 an they still haven't sold! So I hit the pavement an asked around to find out the average house is taking about 60 days or more to sell. Quote "No ones walking through the door at the moment" MYAGENT realty said.

    Do you believe some realestates are artificially inflating the prices?

    Profile photo of seankseank
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    @seank
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    I'm all for, and encourage different points of view, however I think you should post once only then move on, another  post has been generated of similar content already. If you want to repeat posts on "doom and gloom" there is a forum for this and its called the global house price crash forum.  No-one will win this argument, if we do have a crash you get your pat on the back, if we don't we make more money.  As an investor I'm also cautious and waiting , however I think some of the above comments are complete rubbish, and just as damaging as someone saying "prices will keep rising".
    My final comment on this post.

    Profile photo of Alistair PerryAlistair Perry
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    blogs wrote:
    APerry wrote:
    "Australia doesn't have a shortage : it's got a massive oversupply."

    Absolute and utter garbage!

    lol y areckon?? Just wait till the reality bites and a few properties hit the markets. You comment is shortsighted-the fact that there are so many 'armchair expert' property investors attests to the over supply of housing, just wait till they have to selll to see how the supply/demand eqaution works out…

    It's fact that there is a shortage of housing, why do you think rents are rising in most markets?

    With regards to mortgage stress, I spoke to a guy from Pepper Home Loans yesterday (a non conforming lender, for those who don't know) he told me that only about 30% of defaults on their books were caused by people not being able to afford their interest repayments, most were because they have lost their job or have become unable to work for some reason. It is also notable that only around half the dwellings in Australia actually have a mortgage on them.

    I think you will find that mortgage stress is largely concentrated in areas where there are large numbers of new home buyers. There will be relatively few forced sales in established suburbs.

    Regards
    Alistair

    Profile photo of gmh454gmh454
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    @gmh454
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    phana007 wrote:

    No ones walking through the door at the moment" MYAGENT realty said.

    Do you believe some realestates are artificially inflating the prices?

    You always need at least one over priced house on your books.

    It scares people when thay look in the window, and then you sell the cheaper stuff off it…

    straight selling tool

    Profile photo of gmh454gmh454
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    @gmh454
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    APerry wrote:

    There will be relatively few forced sales in established suburbs.

    Regards
    Alistair

    Sydney
    Kellyville drops from 850 to 550 wipes out builders as completed houses are now cheaper than house & land

    Adjoining suburbs Castle Hill and Cherrybrook drop from 850 to 720

    Pennant Hills drops down and so it rolls.

    Why buy a townhouse in Baulkham Hills from a builder for 480 when you can buy a three bedroom house with Db garage in same suburb for 450,

    just rolls inwards in concentric circles

    Profile photo of gmh454gmh454
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    @gmh454
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    APerry wrote:
    [why do you think rents are rising in most markets?

    I think part of the factor is the new wave investor is passing on interest rate rises. In the past most property investors were not so highly leveraged and wanted 52 weeks of rental income with minimal letting costs. Rents often only rose when the place went vacant.

    These days the investor raises it and hopes the significant costs and inconvienence of a move will lock his tennant in.

    When many of these speculators get pushed pass their tipping point and the resetting of rates that will happen to many this year and next will push a substantial amount of property onto the market to be sold at “market”

    I am keeping my hand in my pockets till then

    Have most of my property investors looking like they are living on lemons right now, not a happy bunch, some life changing stories there.

    Profile photo of thecrestthecrest
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    @thecrest
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    Don't be loudly irresponsible Scamp, if you don't know how to invest in the current market, then either DON'T, or learn how by joining the RESULTS program. I did, because I want to learn how.   
    The market is there all the time and is always full of opportunity.       
    Hope you find some, that is, if you want some.   
    cheers
    thecrest

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    Profile photo of John H LewisJohn H Lewis
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    With the recent down turn in the share market i beleive people will start looking more closely at realestate, as a more stable investment i have property in Gunnedah Muswellbrook and newcastle and have a zero vacancy rate, and rents have gone up 30% minimun in the last twelve months,we certainly have shortage of housing in these areas.
                                                                                                                        

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