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

Viewing 20 posts - 501 through 520 (of 645 total)
  • Profile photo of ScampScamp
    Member
    @scamp
    Join Date: 2008
    Post Count: 297
    ErikH wrote:
    Well… Rudd does speak fluent Mandarin, doesn't he?

    Back onto topic, I found the following article on housing prices quite interesting: http://www.realestate.com.au/doc/review/july08/housing-prices.htm

    Thanks , very interesting reading. It's nothing new but it's the first time banks agree that the housing market is overvalued. I posted this on GPHC.

    Profile photo of ScampScamp
    Member
    @scamp
    Join Date: 2008
    Post Count: 297

    Ah yes, the rental prices would go up was the excuse many investors use on this forum. After which I said no they won't because people who can't sell their house will put it up for rent instead ?… This would actually drive rental prices AND house prices down ? here you go :

    http://www.news.com.au/business/money/story/0,25479,24076249-5013951,00.html

    Quote:

    Mr Christopher’s research, which is based on online rental listings and data from the Australian Bureau of Statistics, indicates that compared to last year most cities are showing a rise in available rental properties.

    “In Melbourne and Sydney, it seems the downturn in the real estate market is actually providing more rental properties as vendors withdraw their property for sale and rent it instead,” he said.

    Mr Christopher said Sydney had over 19,500 vacant rental properties in June, up 9000 on the same time the previous year, while Melbourne had 9450 vacant properties up 1800. (See a full capital city breakdown below).

    Profile photo of James_JohnsonJames_Johnson
    Member
    @james_johnson
    Join Date: 2005
    Post Count: 86

    http://www.theage.com.au/opinion/boom-and-bust–20080805-3qgt.html

    Boom and bust …

    "Australian Property Monitors' prediction is that national house and unit prices will fall by 10% over the coming year."

    Illustration: Dyson

    Illustration: Dyson

    Houses are going to become more affordable, but is that a good thing?

    I'VE always been taken by the catchcry of the great American con man Bernie Cornfeld: do you sincerely want to be rich? Most of us would like to be rich, but only a very few of us — and certainly not me — sincerely want to be rich.

    To be fair dinkum about getting rich you have to be prepared to make the sacrifices involved: to find an occupation that's lucrative rather than satisfying, to give up your leisure and neglect family and friends as you work day and night to amass and reinvest your fortune. Above all, you need to want to be rich for the sake of being rich, not for the sake of being a big spender.

    No, most of us don't want to be rich that badly. But let me ask you a question: were you pleased to hear the latest news that house prices are falling nationwide?

    If you weren't, I suspect you don't sincerely care about the deterioration in housing affordability — as most of us imagine we do care.

    Most of us care about the plight of first-home buyers only to the extent of believing the Government should do something about it. Were it to do something that adversely affected the interests of us existing home owners, however, it would quickly feel our wrath.

    And since there isn't much governments could do to genuinely assist first-home buyers that wouldn't disadvantage us, the pollies share our lack of sincerity on the subject.

    But the politicians do have the advantage of the econocrats quietly advising them of something the rest of us keep forgetting: housing affordability moves in cycles.

    The affordability of home ownership is a product of three factors: the price of homes, the level of incomes and the level of interest rates. Whenever the property market booms, house prices rise a lot faster than incomes and so affordability worsens.

    Property booms generally start at a time when interest rates are low. They reach a peak at a time when the rest of the economy is booming and the authorities start worrying about mounting inflation pressure.

    That's when the central bank acts to cool things down by raising interest rates. Initially, that makes affordability even worse. This is the point where people, having been sitting back gleefully watching the value of their homes soar, start worrying about how their kids will ever afford a home of their own.

    Eventually, however, the authorities achieve — or, more usually, overachieve — the desired slowing in the economy. They then start cutting interest rates, which improves affordability.

    But by then the property boom has turned to bust, the banks are more reluctant to lend and many people, being uncertain about hanging onto their jobs, are reluctant to take on the onerous commitment of a mortgage.

    In the good old days, house prices would stay pretty steady for a few years, allowing people's incomes to catch up and thereby further improving affordability.

    It was this pattern that entrenched the popular conviction that house prices never fall — although they always used to fall in real terms as inflation rolled on.

    But that pattern ended with the severe recession of the early 1990s, which saw house prices actually falling, not just marking time.

    And now, according to the more reliable figures produced by Australian Property Monitors, we see house prices falling in the three months to June in all capitals bar Adelaide. In Melbourne they fell by 0.6%, in Sydney by 2.1%. In the mining boom towns of Brisbane and Perth they fell by 1.3% and 2.8%.

    In the two cities where prices rose highest, the softening has been greatest. Over the year to June, prices rose by just 1.1% in Sydney and fell by 1.6% in Perth.

    The bigger they are the harder they fall. And since the past decade has seen by far the biggest property boom in memory, I won't be surprised to see prices fall back a fair way. Australian Property Monitors' prediction is that national house and unit prices will fall by 10% over the coming year.

    This, of course, would do wonders for housing affordability — more than the falls in interest rates we can expect in coming months — even if few first-home buyers are likely to take advantage of it until the economy turns back up.

    Still don't like the thought of falling house prices as the solution to affordability? Prices rose to such unprecedented levels relative to average incomes that only a significant fall in them could get affordability back on track.

    Falling house prices are, however, a two-edged sword. As home owners perceive their wealth to be diminishing, this can encourage them to cut back their spending, contributing to the downturn.

    And were the fall in prices to be too precipitous, it could give a lot of home owners — particularly those with big mortgages — a bad scare.

    I think people with negatively geared investment properties are particularly vulnerable. They've structured their investment to run at a cash loss in the hope that big capital gains will make it all worthwhile in the end. But when prices start falling, why hang on?

    Why not cut your losses and sell before prices fall further? Trouble is, the more investors who head for the exit, the more prices fall.

    It's possible owner-occupiers who bought at the peak of the boom may find themselves facing "negative equity" — owing more than their house is now worth. This is unlikely to induce them to sell up and crystallise their loss, however. Only

    if they lose their jobs and can't keep up their repayments are they likely to be forced out.

    I have a feeling the next few years aren't going to be terribly pleasant. Long before they're over, however, people will have stopped worrying about housing affordability.

    Ross Gittins is a senior columnist.

    Profile photo of ItalianDragonItalianDragon
    Member
    @italiandragon
    Join Date: 2008
    Post Count: 50
    Scamp wrote:
    ErikH wrote:
    Well… Rudd does speak fluent Mandarin, doesn't he?

    Back onto topic, I found the following article on housing prices quite interesting: http://www.realestate.com.au/doc/review/july08/housing-prices.htm

    Thanks , very interesting reading. It's nothing new but it's the first time banks agree that the housing market is overvalued. I posted this on GPHC.

    Hi Scamp, I tried to contact you by private message but it says you don`t accept messages.

    I`d love to have a chat with you, any way we can have it?

    Thanks

    Profile photo of MisterMister
    Member
    @mister
    Join Date: 2007
    Post Count: 112

    Here's a strange one.

    Why is the ANZ boss – might have been NAB ,  I mean who listens to  banks  but –  predicting the mother of all booms coming right now in a report yesterday ?
    Especially considering they are suppose to be resetting fixed rates in a few wks  time  !

    Cheers

    Profile photo of ummesterummester
    Member
    @ummester
    Join Date: 2008
    Post Count: 510
    Mister wrote:
    Here's a strange one.

    Why is the ANZ boss – might have been NAB ,  I mean who listens to  banks  but –  predicting the mother of all booms coming right now in a report yesterday ?
    Especially considering they are suppose to be resetting fixed rates in a few wks  time  !

    Cheers

    A cynic would answer – to grab some more customers before they put up interest rates again.

    An optimist would answer – because he is trying to save the market.

    Profile photo of MisterMister
    Member
    @mister
    Join Date: 2007
    Post Count: 112
    Mister wrote:
    Here's a strange one.

    Why is the ANZ boss – might have been NAB , I mean who listens to banks but – predicting the mother of all booms coming right now in a report yesterday ?
    Especially considering they are suppose to be resetting fixed rates in a few wks time !

    Cheers

    Another thing , actually two that I don't get.
    They're saying our migrant influx is more than it's ever been and that's causing the squeeze on housing demand and driving prices up . Well I will ad that investor lerks and perks that Howard created are also obviously taking up more houses than usual adding the amount of property investing guru influx and TV shows  .
    So call me slow but – wouldn't one assume you should stop the intake for a year or two and let the balance get back into thing's and remove the investor perks to give us the extra 20 or 30% in housing that we apparently need . How frk'n easy is that.

    The second thing is here we are on the news last night ohrrr grocery prices this and that , there's nothing the Gov can do.
    What a load of BS ,  Howard allowed a monopoly in our super market ownership that is the only real reason on the planet we pay close double what countries like US pay for food and everything else – and we don't even complain about it .
    So why is it Rudd can't just reverse that monopoly , which I believe he is actually quietly doing , I should hope so. Tell you what , allow some competition and you just watch grocery prices 1/2 or close and how easy is that , same with fuel , they pay $1.50 a gall in Burma but in the lucky country we pay 6-$7 for that same gallon . My winge is -. What the !!!!!
    Coles reckons it will cost the 20,000,000 to incorperate the new price watch thing – isn't it funny how  the other guys did it for free and didn't even complain and still offer the cheapest groceries in the country .

    Ahh , cheers

    Profile photo of ummesterummester
    Member
    @ummester
    Join Date: 2008
    Post Count: 510

    If unemployment rises too much migration influx will be adjusted.

    Rudd can't change all of Howards implementations immediately.

    Profile photo of blogsblogs
    Participant
    @blogs
    Join Date: 2005
    Post Count: 418
    Mister wrote:
    Mister wrote:
    Here's a strange one.

    Why is the ANZ boss – might have been NAB , I mean who listens to banks but – predicting the mother of all booms coming right now in a report yesterday ?
    Especially considering they are suppose to be resetting fixed rates in a few wks time !

    Cheers

    Another thing , actually two that I don't get.
    They're saying our migrant influx is more than it's ever been and that's causing the squeeze on housing demand and driving prices up . Well I will ad that investor lerks and perks that Howard created are also obviously taking up more houses than usual adding the amount of property investing guru influx and TV shows  .
    So call me slow but – wouldn't one assume you should stop the intake for a year or two and let the balance get back into thing's and remove the investor perks to give us the extra 20 or 30% in housing that we apparently need . How frk'n easy is that.

    The second thing is here we are on the news last night ohrrr grocery prices this and that , there's nothing the Gov can do.
    What a load of BS ,  Howard allowed a monopoly in our super market ownership that is the only real reason on the planet we pay close double what countries like US pay for food and everything else – and we don't even complain about it .
    So why is it Rudd can't just reverse that monopoly , which I believe he is actually quietly doing , I should hope so. Tell you what , allow some competition and you just watch grocery prices 1/2 or close and how easy is that , same with fuel , they pay $1.50 a gall in Burma but in the lucky country we pay 6-$7 for that same gallon . My winge is -. What the !!!!!
    Coles reckons it will cost the 20,000,000 to incorperate the new price watch thing – isn't it funny how  the other guys did it for free and didn't even complain and still offer the cheapest groceries in the country .

    Ahh , cheers

    Mister there are so many things wrog with what you have said I dont know where to start. Not very bright are you….

    Profile photo of ummesterummester
    Member
    @ummester
    Join Date: 2008
    Post Count: 510
    blogs wrote:
    Mister there are so many things wrog with what you have said I dont know where to start. Not very bright are you….

    It's the voice of the average people Blogs – bright or not they have had it with where capitalism has taken Australia.

    Profile photo of superhoopssuperhoops
    Member
    @superhoops
    Join Date: 2008
    Post Count: 15
    blogs wrote:

    Mister there are so many things wrog with what you have said I dont know where to start. Not very bright are you….

    Rather patronising comment don't you think. 

    Profile photo of MisterMister
    Member
    @mister
    Join Date: 2007
    Post Count: 112
    blogs wrote:
    Mister wrote:
    Mister wrote:
    Here's a strange one.

    Why is the ANZ boss – might have been NAB , I mean who listens to banks but – predicting the mother of all booms coming right now in a report yesterday ?
    Especially considering they are suppose to be resetting fixed rates in a few wks time !

    Cheers

    Ahh , cheers

    Mister there are so many things wrog with what you have said I dont know where to start. Not very bright are you….

    Actually Bloggs , or whatever you call yourself , 125 and very good passes in everything I have ever taken on beg to differ on that one .
    I may not bother to word myself in some poppas manner trying to impress faceless people but does that impress you , who the hell are you anyway . I can guarantee you one thing – I can spell wrog !
    Funny thing about just who is bright in the world and who is not .
    Like the two million dollar 2 year study they have just completed to conclude what – oh that's right . Old growth big trees use allot more air and so clean much better than regrowth so we better stop cutting them down.
    The state of the country – in depth is just as obvious yet the very people we count on to bring us the real situation are even blinder than that and the money people seem to have even bigger blinkers on .

    OK simple terms .
    Are you one of the geniuses that believe Howard created and left us with a good and strong economy and a healthy country?. You will be because people think this year – last year or next year is an economy – they don't think about 20 yrs or 50 or the 10 yrs of neglect or where creating one thing may lead us for years to come , just like trees !
    To answer that one we do need to actually think about just where it actually leads the country  .
    And some of the biggest minds in the country can't see that one even yet .
    It runs a little bit deeper than the two million you made last year or the private health insurance that gets you your heart surgery.

    Have a nice day genius

    Profile photo of ummesterummester
    Member
    @ummester
    Join Date: 2008
    Post Count: 510
    Mister wrote:
    I can guarantee you one thing – I can spell wrog !

    I am not a nasty person – honestly…. but that is frakin' hilarious!!!

    Profile photo of harbharb
    Member
    @harb
    Join Date: 2006
    Post Count: 324
    Scamp wrote:
    Do you think I am an idiot ? many things will be different ( take the weather for instance ).

    Now why would I think that about you ? That's not a very nice thing to say. After all you've done your research and you know the weather is different. BTW, did you know the distance between Hobart in the South and the top of Cape York is more then the distance between Holland and Egypt and as such we have different weather between North and South?

    Quote:
    Sydney is the world's most unaffordable city. And from what I heard, people in Sydney aren't earning what people in Los Angeles ( Hollywood ? ) earn. It's unsustainable.

    Sydney is the world's most unaffordable city, unaffordable to whom exactly ? I haven't seen any stampede on TV so the majority must still be able to afford to live there . Besides, its all relative to your wealth, income and prospects … if you think Sydney is unaffordable for you then it would be silly to buy there, wouldn't it ? There are always affordable alternatives somewhere else, like Tumbarumba for eg.

    http://www.realestate.com.au/cgi-bin/rsearch?a=o&id=105087144&f=10&p=10&t=res&ty=&fmt=&header=&cc=&c=14751278&s=nsw&snf=rbs&tm=1218012048

    Then again, for someone arriving in OZ with no money or job prospects a house in Tumbarumba would be also look unaffordable, at least in the beginning. Would you say that's because the house was overpriced or only unaffordable?

    Quote:
    Been there, done that. It's just a matter of time before the jobs come back. I've seen it happen in USA , Europe, and soon in Australia too.

    I'm sure you have, I only wanted to bring to your attention that currently the IT guys here are unaffordable and unsustainable. I suspect when they have a wages drop of 50% or more then some businesses will reconsider and if they found it affordable maybe bring back some jobs. But until that time comes they will continue to rent IT guys from India. Why pay silly money for someone to pick his nose and surf the web when for a fraction of that you get someone who comes up with the results ? Don't answer that, it was a rhetorical question.

    Quote:
    On top of this, the houseprices aren't going up for the next 3 years at least.

    Is this prediction coming from the same guy who gave the last tip about 2 more rate rises before Xmas ? Man, If I was you I'd go find him, beat him up real good and get my money back.
    But hey, I see you you're still dreaming so I don't want to wake you up. Enjoy your dreams while they last Scamp.

    Profile photo of MisterMister
    Member
    @mister
    Join Date: 2007
    Post Count: 112
    ummester wrote:
    Mister wrote:
    Here's a strange one.

    Cheers

    A cynic would answer – to grab some more customers before they put up interest rates again.

    An optimist would answer – because he is trying to save the market.

    Why thank you ummester .

    Nice to hear someone doesn't mind lowering themselves to give an opinion to the likes of me , I'm not very bright youknow ! .
    I don't believe not doing so would be  ' wrog '  exactly but ,  woops.

    Cheers

    Profile photo of ummesterummester
    Member
    @ummester
    Join Date: 2008
    Post Count: 510
    harb wrote:
    Sydney is the world's most unaffordable city, unaffordable to whom exactly ? I haven't seen any stampede on TV so the majority must still be able to afford to live there . Besides, its all relative to your wealth, income and prospects … if you think Sydney is unaffordable for you then it would be silly to buy there, wouldn't it ?

    No, I am not Scamp so don't get confused but your misunderstanding of the situation has compelled me to respond. Sydney is unaffordable to average Australians.

    http://www.livenews.com.au/Articles/2008/06/02/Teachers_nurses_cant_afford_to_live_in_Sydney

    http://www.news.com.au/dailytelegraph/story/0,22049,23793786-5017224,00.html

    http://www.abc.net.au/news/stories/2008/06/02/2261916.htm

    http://money.ninemsn.com.au/article.aspx?id=573065

    I wonder what all the property investors in Sydney are going to do when all they are left with are the homeless, residents of government housing and themselves?

    harb wrote:
    Is this prediction coming from the same guy who gave the last tip about 2 more rate rises before Xmas ? Man, If I was you I'd go find him, beat him up real good and get my money back.
    But hey, I see you you're still dreaming so I don't want to wake you up. Enjoy your dreams while they last Scamp.

    It's not Xmas yet…. don't count those chickens.

    Profile photo of ScampScamp
    Member
    @scamp
    Join Date: 2008
    Post Count: 297
    ItalianDragon wrote:
    Scamp wrote:
    ErikH wrote:
    Well… Rudd does speak fluent Mandarin, doesn't he?

    Back onto topic, I found the following article on housing prices quite interesting: http://www.realestate.com.au/doc/review/july08/housing-prices.htm

    Thanks , very interesting reading. It's nothing new but it's the first time banks agree that the housing market is overvalued. I posted this on GPHC.

    Hi Scamp, I tried to contact you by private message but it says you don`t accept messages.

    I`d love to have a chat with you, any way we can have it?

    Thanks

    I'll enable private messages.

    Profile photo of ummesterummester
    Member
    @ummester
    Join Date: 2008
    Post Count: 510
    Mister wrote:
    Why thank you ummester .

    Nice to hear someone doesn't mind lowering themselves to give an opinion to the likes of me , I'm not very bright youknow ! .
    I don't believe not doing so would be  ' wrog '  exactly but ,  woops.

    Cheers

    That's cool Mister,

    I also find some of the things you are concerned about with Australia of late upsetting and believe they have to improve with a correction in property prices. Time will tell.

    Check out this comment some-one (not me) posted on News.com.au the other day.

    'If you want more babies – get house prices down If you want more volunteers – get house prices down If you want less divorces – get house prices down If you want to be better prepared for retirement – get house prices down If you want more time with your kids – get house prices down If you want your kids to have a better future – get house prices down If you want more entrepreneurs – get house prices down If you want to make paid maternity leave unecessary – get house prices down If you want to afford green policies – get house prices down So why the heck have successive governments done nothing about getting house prices down?

    Posted by: Gen X of Sydney 3:52pm today
    Comment 185 of 187'

    It about sums it up. The mood in the country is changing, I may not know finance as well as some but I am okay at keeping my finger on the pulse of the public mood. It will change but the process is going to get hard before it gets better.

    Profile photo of ScampScamp
    Member
    @scamp
    Join Date: 2008
    Post Count: 297
    harb wrote:
    Is this prediction coming from the same guy who gave the last tip about 2 more rate rises before Xmas ?

    We have had 1 rate rise already, and it's still 4 months till Xmas. Plenty of time for another rate rise.
    Be happy if you don't see the other rate rise with current inflation levels. Then again, I guess the economic climate was SO bad that even I was an optimist to think there was enough leverage left for that ( what should have been a correct ) rate rise. Apparently things are going worse than I though. If a few rate rises bring Australia's economy to a complete halt ( which is what spruikers are saying now ), then I was being too optimistic.

    Profile photo of harbharb
    Member
    @harb
    Join Date: 2006
    Post Count: 324
    ummester wrote:
    [
    No, I am not Scamp so don't get confused but your misunderstanding of the situation has compelled me to respond. Sydney is unaffordable to average Australians.

    "Nurses, teachers and emergency department workers in Sydney are being forced to buy houses long distances away from their jobs."

    Wow, I'm really sorry for them if they are forced to buy houses. What happened, the rents in the CBD are too high for them ?

    "Of the country's top 10 most unaffordable areas, Sydney has six. With a $2 million-plus median house price, Mosman is Australia's least affordable place. The median house price there is 32 times a police officer's annual earnings – and 40 times for a nurse."

    Wow again, the average nurse or policeman is priced out of that $2M median house in Mosman. That could explain any corruption happening in the NSW police force, they all want to live in Mosman. No wonder the median price is so high over there and would also explain why someone would need a 40 years Easypay Home loan from the "Police and Nurses Credit Society ".

    "On that formula, key workers such as nurses, firefighters, teachers and police officers are effectively shut out of 93 per cent of local government areas in Sydney, meaning they cannot live in many of the communities they serve."

    93% of local government area , that sounds like a lot. Sounds to me like they have to use public transport or a car to get to work. That's tough, I really feel for them.

    "According to research released this week, more than 80 percent of capital city council areas are too expensive for key workers to buy a house, forcing them to move away and face a hefty commute to work."

    So they are shut out of 93% but only 80% are too expensive ? How does that work out ?
    Sounds to me like they've started working on the next pay rise.

Viewing 20 posts - 501 through 520 (of 645 total)

You must be logged in to reply to this topic. If you don't have an account, you can register here.