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

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    devo76 wrote:
    I dont think anyone is in denial in regards to oil and its longevity. Its just that most dont believe the world will come to a screaching holt in the near future. You appear to be one of those people living in fear of what lay ahead. Not caution,fear. Just as war and famine etc etc dominated the polls for whats going to kill us in the past.But dont let me stop you. Start chucking statistics up now as im sure you will. Maybe its time to start building a bunker and stock it with fuel. Mad Max becomes a reality. God help us all.

    I dont think ormeau is saying the world is coming to an end. My interpretation is that all you bly sky dreamers seem to blindly believe property prices will continue to sky rocket, and heaven forbid ANYONE who says property prices will fall. Yet none of you want to even consider the effect peak oil will have on the economy??? Sure it may not send us spiralling into a depresssion blah blah blah BUT is sure as hell could quite easily put us into a situation where property values will not only stagnate but will also fall.

    Why do you find it so hard to believe that people with massive mortgages (and there are lots these days-how many can afford cash for a typical $650-$700k house?) will be able to cover spiralling costs ontop of their already stretched budget??

    Try to keep it simple-house are ALREADY at record levels of unafordability, yet even when faced with spiralling inflation, fuel and food costs you think people will STILL be able to find even MORE money to support rising property prices?? It stagers beleif….where will

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    devo76 wrote:
    I dont think anyone is in denial in regards to oil and its longevity. Its just that most dont believe the world will come to a screaching holt in the near future. You appear to be one of those people living in fear of what lay ahead. Not caution,fear. Just as war and famine etc etc dominated the polls for whats going to kill us in the past.But dont let me stop you. Start chucking statistics up now as im sure you will. Maybe its time to start building a bunker and stock it with fuel. Mad Max becomes a reality. God help us all.

    I dont think ormeau is saying the world is coming to an end. My interpretation is that all you bly sky dreamers seem to blindly believe property prices will continue to sky rocket, and heaven forbid ANYONE who says property prices will fall. Yet none of you want to even consider the effect peak oil will have on the economy??? Sure it may not send us spiralling into a depresssion blah blah blah BUT is sure as hell could quite easily put us into a situation where property values will not only stagnate but will also fall.

    Why do you find it so hard to believe that people with massive mortgages (and there are lots these days-how many can afford cash for a typical $650-$700k house?) will be able to cover spiralling costs ontop of their already stretched budget??

    Try to keep it simple-house are ALREADY at record levels of unafordability, yet even when faced with spiralling inflation, fuel and food costs you think people will STILL be able to find even MORE money to support rising property prices?? It stagers beleif….

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    Dont worry, be HAPPY :)

    http://www.news.com.au/heraldsun/story/0,21985,23765169-5005961,00.html

    "Jobless queues to grow"

    "Growth is slowing at a time when inflation is rising, which will also put household under additional financial stress as living costs soar and some main breadwinners lose their jobs. "

    Hang on, wasnt this exactly what I was saying?? Maybe they dont know about the money tree the majority of the population hvae planted in their back yard??

    Profile photo of Peak OilPeak Oil
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    Sorry for the rant guys, and sorry if I have offended. I should not post on forums when drunk.

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    blogs wrote:
    ormeau wrote:
    WOW, your a fool. I hope for the sake of the Australian public that you are not a financial planner………

    Gee you really got him there-god knows how he could ever rubute such a witty and intelligent remark as that. The way you have justified and backed up your claim has without left scamp no option but to admit defeat and go home with his tail between his legs..

    lol you are the fool. Keep the comments coming, Ive been saving them to show my kids in years to come just how blindly ignorant people can be when overcome by greed and fear.

    Oh for God sake I hope they haven't let you breed!

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    APerry wrote:
    It's been settled, all economists should be fired on the spot. Scamp and Blogs are the only people worth listening to! 

    HAHA Classic! Honestly I would love to know what you guys (Blogs and Scamp) do and where you guys come from?? I have a sneaking suspicion you are the kind of people who keep coming up with excuses for not ever investing in anything just drag others down who are trying to get ahead in life.  If you both claim to know so much about the future why didn’t you both buy half a dozen properties in W.A 10 years ago or but $100,000 dollars worth of Midwest shares 2 years ago at 69c (currently worth $7.00)? I can guarantee you wouldn’t be sitting behind a computer screen now from some dimly lit office claiming to know something about the economy. You might be more like me and some of the other people on here who are feeling positive about the future due to doing our research and also understanding the basic rule of investing” There are always opportunities to make money in any economy you just have to get out there and find them” I wish you both the best of luck you will need it with your predictions!

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    Scuba37 wrote:
    Oh for God sake I hope they haven't let you breed!

    Well the lack of opposable thumbs didnt stop your parents…

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    Scuba37 wrote:
    HAHA Classic! Honestly I would love to know what you guys (Blogs and Scamp) do and where you guys come from?? I have a sneaking suspicion you are the kind of people who keep coming up with excuses for not ever investing in anything just drag others down who are trying to get ahead in life.  If you both claim to know so much about the future why didn’t you both buy half a dozen properties in W.A 10 years ago or but $100,000 dollars worth of Midwest shares 2 years ago at 69c (currently worth $7.00)? I can guarantee you wouldn’t be sitting behind a computer screen now from some dimly lit office claiming to know something about the economy. You might be more like me and some of the other people on here who are feeling positive about the future due to doing our research and also understanding the basic rule of investing” There are always opportunities to make money in any economy you just have to get out there and find them” I wish you both the best of luck you will need it with your predictions!

    You would be surprised who and what many of the people on this site do!! Lets just say I base my research and beliefs on more than hope or realestate agent spin.  Try reading some of my posts einstein-Im sure you will feel embarrased and realised what a fool you are lol No Im not the type who is to 'scared' to invest, quite far from it actually. But Im not so stupid to invest in something at the peak of its cycle, especailly when everything is telling me its going to fall-maybe thats your speciality?

    Funny how you mention investing in shares-as a matter of fact just so you can sleep soundly you will see in my old posts I sold a few of my investment properties and put the money into the stock market. From just that move alone I can garauntee I have made more money in the last 3 months than you would have in the last ten years lol gee maybe I do know something about the future?? Nah I just dont have your silly 'buy property-its the only way to make money everything will be o.k' rose coloured glasses on…

    So you keep up the good work chump!! Im quite happy with how I have gone over the years, are you? Smart money moves where the highest returns are, why anyone would be buying properties now is beyond me? But you keep having feel good feelings about the future, Im sure thats how all the rich people in the world made their money ;)

    BTW, how much money have you made over the last few years? I would like to compare my bank balance from my 'dimly lit office' :)

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    I suppose I like to look at it this way-if Im wrong I will still be rich,  BUT if Im right  I will still be rich, but many here will be broke…so Im in a no loose situation…are you?

    Have a good day :)

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    blogs wrote:
    vicgirl wrote:

    Again another article in the paper on the weekend stating already properties at the top end of town are selling for $100k less than they were just 12 months ago-and we arnt even in 'financiall hardship' yet,

    Client unloaded a property at Palm Beach for 6.25M end of last year, best estimate for it now is 4.5M

    (Very unique property Olsens stayed there a while ago)

    Palm Beach is proably the pinacle of the top end discrectionary investment.

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    seank wrote:
    blogs wrote:
    seank wrote:

    Scamp have been spending too much time in those Holland cafes? Did you read the article properly?

    This relates to Public trustee houses, which can't be rented out and have nothing to do with the rental shortage.

    Ahhh Seank sure you read the article yourself? It isnt JUST about public trustee houses, it is also about properties that are vacant for other reasons. That asside you would also realise the article is saying "Every year about 1200 vacant houses fall into the hands of the Public Trustee" but due to red tape they cant get onto the market instantly. Also that "The number of unoccupied residential dwellings in Sydney counted by census workers in 2006 was 122,211, with the highest number found in the inner city" -not all of these were due to Trustee issues as you incorrectly pointed out. Read the article again in full maybe…

    I think you have missed the original arguement point which was -there is a shortage of RENTAL  and SELLABLE properties which is driving up demand., and rentals. Scamp replied with the above article, which indicates YES there are vacant houses for various reasons, however  they can't be rented or sold,  so in reality these numbers mean nothing in relation to supply……
    If you found the proper data on rental vancanies  I'm sure it would paint a different picture….

    The article also makes reference to houses held by developers waiting for the right time.

    Also I have observed more vacant property awaiting sale than ever before, think this is a current phenom

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    DOOM, BOOM, GLOOM, Where are we headed?

    From the 6 or so pages I have read here, no one knows. You can chuck figures around left, right and centre and will still be arguing once this issue has died down and everyone has found something new to whinge about.

    If we are seeing house prices down, shouldn’t that be a good time to buy and hold?  If they do go down further, ride out the trough and wait for the rise.  Ya gotta be better off in the end? 

    If you are worried about rising interest rates, fix your interest rate.

    And what if this IS the bottom of the trough and house prices rise again?

    If we are seeing rent prices going up and vacancy rates dropping, again, isn’t that time to buy? 
    No worries about find tenants.

    It is also the time to review your current rentals. 
    Can you add a clause to your leases the allow a rent review every 12 months if you have (or want) tenants on fixed rentals?

    Forget about oil, that’s basically a user pay system. You want to use it, you gotta pay for it. Yeah I know the high costs of fuel are apssed onto the consumer through other commodities  
    How many of you have considered the “other” resource that directly affects home rental.  Water,… Ahhh yes, do you pay for the water your tenants use? 

    It’s now a “user pay” system so why not pass that onto your tenants so they pay for what they use, just like the power and the gas? 

    If things are so Doom and Gloom in the area you are focussing on, look outside the square a bit. 

    I’m in what is rapidly become one of the biggest growth centres in eastern Australia, the Albury Wodonga region.   I have two homes here.  One is in the suburb of Lavington and one in the suburb of West Albury. 

    The Lavington home (4 Bedroom) was bringing $300 per week rent (I live here now) and is on the market for $287,000 http://www.albury-home-sales.com/LNames.html and the West Albury home (4 Bedroom) was bring $350 per week (now vacant to sell) and is now on the market for $329,000 http://www.albury-home-sales.com/WANames.htm . 

    Why am I selling them then? 
    To retire, tour and REST. 
    I don’t really want to be bothered with investment homes anymore as I have a super scheme that will look after me and set me free to do the things I want to do.

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    Good for you Pouncer.  I wish I could retire!  10 years time maybe!

    Great posts, interesting reading.  Shame it took personal attacks and insults to get people tapping on the keyboard!

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    Wow.  That was quite a read.  Well, tell the truth, I only got to the bits were the bears were going to fight the bulls in the pub car park.  Maybe each side should chose a champion and let them have at it? 

    Anyway, for those of you who have the time to read six pages of opinions, here's my two dallars worth. 

    Firstly, those of you who try and time the market will invariably fail.  Just look at the performance of indexed stock investments versus the performance of the fund managers over the long term.  Indexed wins out 99% of the time. 

    Secondly, if you are serious about property then you need to be in it for the long haul.  However, even long term investors still need to take a position on market conditions and align your portfolio and buying/selling activities to that position.  If, for example, you believe that interest rates are going to rise another 2 to 3% in a relatively short period and that a10%+ price correction is going to happen within 18 months,  then start thinking about reducing your LVR's, off loading your lemons and fixing your rates.  Whatever you believe, act on it.

    Thirdly, please don't throw the baby out with the bath water.  I hope that no one on these forums buys on emotion or sells on a whim.  We are supposed to buy bargains or sell based on facts and figures.  Right now is the time to be buying your profits up front – not relying on hefty capital gains (although those will return in due course).  Down turning markets mean there are unfortunately property owners who need to sell quickly at below market values.  My advice is to get yourself in the position to buy otherwise you'll be attending the sales with nothing in your back pocket.  And that will, when you look back in five years time, be a very frustrating memory.

    All the best

    Andy

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    Andy,

    Nice comments. My basic argument is that things are gunna get worse before they get better, so unless you come across a bargain I would be suring up capital and waiting patiantly. Basic risk reward-the odds are that prices will stagnate if not drop more than prices rising. Thats a good enough risk analysis for me to sit out for the time being. If I was to buy know only to see my property stagnate or drop I would be saying to myself 'o.k why did you buy, what factors told you prices would be increassing' and at the mo everything is telling me the opposite. Good luck to all-courage is needed in life no matter what you do…

    And I have enjoyed the fisty cuffs, car park at 10:30, winner takes all ;)

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    yes it all comes back to financial education … 12,562 bankrupts in the last 12 months in NSW alone … yep worse to come … D

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    Jolly good show its a shame you couldn't help them

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    WHY DOES PROPERTY EXPERT AND PROPERTY GURU MICHEAL YARDNEY THINK NOW IS A WONDERFUL TIME TO BUY REAL ESTATE? That is what he keeps saying in his emails to me.

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    Rhys_Roberts wrote:
    WHY DOES PROPERTY EXPERT AND PROPERTY GURU MICHEAL YARDNEY THINK NOW IS A WONDERFUL TIME TO BUY REAL ESTATE? That is what he keeps saying in his emails to me.

    Has he ever told you NOT to buy??

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    blogs wrote:
    Andy,

    Nice comments. My basic argument is that things are gunna get worse before they get better, so unless you come across a bargain I would be suring up capital and waiting patiantly. Basic risk reward-the odds are that prices will stagnate if not drop more than prices rising. Thats a good enough risk analysis for me to sit out for the time being. If I was to buy know only to see my property stagnate or drop I would be saying to myself 'o.k why did you buy, what factors told you prices would be increassing' and at the mo everything is telling me the opposite. Good luck to all-courage is needed in life no matter what you do…

    And I have enjoyed the fisty cuffs, car park at 10:30, winner takes all ;)

    I'm looking to get my first step into property investing, and I too think property prices will drop even further. I base this on the flow on effects of the credit crunch, current inflation levels to force the RBA to raise interest rates.

    My question is, how far will prices drop and for how long? What tell-tale signs can you look at?

    The only thing i can think of are interest rates dropping, but by then I believe it's too late.

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