Buy now or hold off? No one knows of course but am hearing so many so hold off for 6 months as prices will REALLY drop.
Then I hear forcasted interest rates cuts which would push home prices up??
Am looking at unit in Collaroy in the northern beaches but still feel better value as a purchaser may be lying ahead yet you don’ want to miss out either.
It seems nowadays anyone wanting to invest – whether property or shares, faces a turmoil of frightening decisions! What’s left? Term deposits???kong71286Participant@kong71286Join Date: 2009Post Count: 261
- Australia is not one property market, but is made up of thousands, which are all moving in different directions or at the same speed. At given point of time, there are markets that are going backwards, markets that are flat-lining, markets that are growing moderately and some that are growing strongly. That means there are always opportunities in Australia to create wealth.
- Instead of asking "Is this a good time to buy real estate?" a better question would be "Where is it a good time to buy real estate in Australia?"
Well, the concerns you have are all fair. Times are becoming increasingly unpredictable. Today's knowledge could be tomorrow's foolishness. I think there's a lot of people out there who are willing to tell you, with a degree of certainty, what THEY believe is going to happen in the future. However, some will be wrong, and some will actually be half right. Ultimately you need to make your decision based on the information you have, be comfortable with your decision, and never to beat yourself up if the decision turns out to be the 'wrong' decision.
With property, I have read this countless times: Time in the market, not timing. So if you were asking for my opinion, I'd be telling you that now is a favourable time to buy, but expect competition still if you're looking to buy into quality property. Clearance rates are definitely down from a year ago. But if you look carefully, it's not surprising. Current sentiment and economic conditions play a role in reducing confidence and causing people to hold off buying. But also consider the relative lack of quality stock at reasonable asking prices and you can easily see why certain properties are just not selling.
When news is bad, that's usually a good time to buy. Didn't Warren Buffet blow a huge amount of money on a railway line at the time the GFC was in full swing? Most would have thought you would be insane to buy something like that in the middle of a recession. These guys succeed not only because they are gutsy, but also smart, investing against the mentality of the general herd.Jamie MooreParticipant@jamie-mJoin Date: 2010Post Count: 5,069QM wrote:Buy now or hold off? No one knows of course but am hearing so many so hold off for 6 months as prices will REALLY drop. Then I hear forcasted interest rates cuts which would push home prices up?? Am looking at unit in Collaroy in the northern beaches but still feel better value as a purchaser may be lying ahead yet you don' want to miss out either. It seems nowadays anyone wanting to invest – whether property or shares, faces a turmoil of frightening decisions! What's left? Term deposits???
Property (in my opinion) should be viewed as a long term asset. If you've decided that you want to invest in property – then perhaps get yourself in a position whereby you're ready to purchase and if you do decide to jump in – you'll be in a position to do so.
No one can predict the future – but some good due diligence goes a long way when looking to purchase an IP.
JamieNigel KibelParticipant@nigel-kibelJoin Date: 2005Post Count: 1,425
The great Industrialist Paul Getty once said I buy when every one else is selling.
There has never been a better time to buy, whether its here or in some parts of the United States
In Australia I believe the market is at the bottom. I am looking to buy development property in inner city Brisbane as i believe the market is under valued. Once you get a change of government some of the confidence will return.
In America i deal in Texas one of the best markets in America. I do not believe we will see any major change in the US until 2015. So there is plenty of time to establish your portfolio there. In Australia there is about 12 months to take advantage of current conditions.
I want to thank everyone for their feedback…it is food for thought. I am in a position, ready to buy and have been doing my research for some time now in different areas and regions.
One thing I have learned along this windy path is that I absolutely loathe real estate agents. They’re must think that we as purchasers, are fools.Angel 13Participant@angel-13Join Date: 2011Post Count: 20
Thanks for the great thread.
I'm certainly feeling more comfortable with the choices I'm about to make in this market.DerekMember@derekJoin Date: 2004Post Count: 3,544
It doesn't matter which asset you invest in no-one is going to ring a bell telling everyone the top/bottom has been reached.
Need to make informed decision based on research undertaken. As Jamie said having time up your sleeve is always advantageous. Consider time available, with your family situation, employment security, long term plans and end goals. The answers to these (and many other questions) really dictate what you should do.
Focus on the journey and not the property.QM wrote:One thing I have learned along this windy path is that I absolutely loathe real estate agents. They're must think that we as purchasers, are fools.
Woh…wait up there. Not saying you should treat RE agents as your friends, because they are after all, working for the vendor and looking after their own hip pocket. However you'd do well to find yourself at the top of their 'interested parties' list by being forefront with them in expressing interest in buying properties with specific characteristics. That way, if they do see one, they can notify you before it actually hits the market. At that stage, you can still do your research as to whether it's a good buy, but the point is to get a chance to buy a property (if the numbers stack up) before it starts to attract huge attention after being advertised.
I've never personally bought a property before it hit the market, but have definitely in the past registered such interest with various agents. Key thing is to be a serious buyer with the knowledge of exactly what you want to buy (and let the agent know this), keep your price range secret, and be ready to launch on the deal when it presents itself.EPI_DenMember@epi_denJoin Date: 2010Post Count: 71
There's some good advice here, such as "it's not timing, it's time in the market". Remember property investing is a long-term thing.
The Aussie market is made up of lots of little markets, so look at your little markets. Some of them are unpredictable but at the moment there are a few markets which are very steady and stable. This might be because of the uncertainty which is causing other markets to fluctuate, or it might be for other reasons. Regardless, you can find sales data for areas such as Springvale, Sunshine and Broadmeadows (three separate areas) in Melbourne which all seem to have had pretty consistent prices for a few months.
Part of knowing this can be helped by getting to know Real Estate agents, who aren't necessarily the most popular people, but they are a wealth of information. Granted, they work for the vendor, but they understand that every vendor needs a buyer, and sometimes it's not worth putting in heaps of effort to get another $5k when all they'll get for that is about $100… Let the Real Estate Agent know what you're looking for and the agent might be able to pass on some pretty good deals. Less work for him/her means a better per-hour commission!
This local knowledge is better obtained from a Real Estate Agent than from tables of figures as some of these tables can mislead (unintentionally) if there are several different markets working in the same location.
Hope this helps, and good luck for your investing!
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Thanks again all for your valuable comments!
BTW, already have done suggestions made concerning expressing interets etc with RE agents but through several experiences we’ve had, the dealings have been negative and almost arrogant where they think they’re doing you a favour.. They’re not selling as much as they’s like. That’s a fact.
Thanks again!APOLOParticipant@apoloJoin Date: 2008Post Count: 33
Its now or never ,if you are not in a position to buy now then think twisedesiluckyMember@desiluckyJoin Date: 2011Post Count: 34
Given the current market condition, I won't invest in property markets right now……… Primary reason for my fact is based is on GFC mark 2.. Given the govt bail outs happening this year,,, mid 2012 we will be seeing worst time in property and stock markets according to me…. Bailing out this troubled economies is big problem, since the problem is only being taken away from its current solution……… I think when the time comes to repay this debt, with US and EU economies,,, this will be sending a great shock wave in fin world…………. If you have money with good deposit, you are better off holding that money in fd or bank accounts………… This shock wave will be the best time to jump into the markets,,,,Look at current state of NSW govt,, they are starting cost cutting by making people redudent,,, same with Big 4 banks,,, sending jobs offshore,,,, all this people along with exiting baby boomers will create a huge cash flow issues in market…….. Lastly the financial meltdown will give a kick start to drowning economies of world…………………………….. Tell me if you have any logic defending my understanding above………..
Hold on to ur horse,,,,, right now, mate,, and njoy the cash rate,,,,,,,,QM wrote:Thanks again all for your valuable comments! BTW, already have done suggestions made concerning expressing interets etc with RE agents but through several experiences we've had, the dealings have been negative and almost arrogant where they think they're doing you a favour.. They're not selling as much as they's like. That's a fact. Thanks again!
As with any industry, there's good and bad ones I suppose. A while ago I went to an OFI to check out a house my parents might be interested in moving into for retirement. I was pretty tired then with listed prices being far below eventual selling prices. So I asked this agent something along the lines of, 'How much do you reckon this house is worth' or 'How much do you believe this house would sell for' or 'What are some of the figures from interested parties at the moment'?
I got a terrible response. The agent pulled out a pen from his pocket and said 'How much do you think I have in my pocket, and how much do you think I'm willing to pay for this pen?' What a crock. He must have looked at my face and thought I were an 18 year old kid pulling his leg. I was very insulted and have decided never to talk to him again. He still has my email address so I do get market updates from time to time, but that's pretty much where it's gonna stop. I wish him all the best with his career.
On the other hand, there are nice ones out there, like the one I bought my first home from. And there's others who maybe were not so nice before but are having to be very nice now because the market is quiet. I've had long phone calls with a couple of agents, just having a nice chat about the market in general and some suburbs here and there. One of them thanked me for spending the time on the phone. Agents are human after all, despite their flashy cars and all.
From all my research I'm with you on your logic.
Attended the 3 day Harry Dent seminar – and the opinion was expressed as the same.
So not investing in RE -brings the question around to what one does with the cash in the meantime..DerekMember@derekJoin Date: 2004Post Count: 3,544
Whatever Harry Dent said was good.
The guy was brought to Australia for a series of speaking engagments and sell hi new book. There is absolutley no doubt in my mind that the negative messages generated by Dent's publicists were purely about book sales.
Mark Bouris has a lot to say about Harry Dent in this articlehttp://tinyurl.com/3sz69vg
No doubt Mark's comments will be considered as 'vested interests' and Dents given more credibility because they are negative.
For the record and in my opnion I believe property prices will remain stagnant in many markets across Australia for a while longer – the key is finding those areas where rent returns and capital profits can be made even in todays market.
Thank you Derek. Great reading. I agree – the next step is how to find these properties and where…bjsaustParticipant@bjsaustJoin Date: 2009Post Count: 141
My general feeling is there's no rush. Whatever's going to happen in the market, I find any kind of significant rise in the next two years to be very unlikely. That said, there's no reason not to buy the right property at the right price for the right reasons now. My main "advice" would be to not get too leveraged right now. I would have trouble sleeping right now if I wasn't comfortable with my levels of reserve in serviceability.
A lot of property spruikers make the claim (as fact usually) that now is the greatest time in ages to buy property. Whilst I don't really agree, what I really don't like is the implicit assumption with such a claim that its only a small window of opportunity and people need to act right now.
Point to note on the last few responses, its very hard to get any information from unbiased parties. Not surprising I guess, as if someone didn't have a vested interest in property then their opinions probably aren't worth much anyway. However I get a little tired of being bombarded with emails from from people/companies who clearly have a vested interest in promoting a positive outlook for property. I don't know about you guys, but I'm yet to get an invitation to an event where I'll have the opportunity to spend 4 figures on finding out why now (now being any time I've gotten an email) is a bad time to buy property? Or "market research" from a property valuation service claiming that property prices are likely to drop, so I'd be wasting money buying their valuation reports just now?
At the end of the day, noone is going to tell you the right answer, and if they do its more likely to be just luck. You need to monitor the market, be aware of the larger global market forces and make some educated guesses.
For instance, that article linked above talks about how the emerging nations are driving global GDP and somehow (I didn't read the details just browsed) this is good for Australian property (presumably because we sell them commodities). However, I can't help but ask myself how much of the GDP of those emerging nations is driven by consumerism of the first world countries? If theres economic collapse in the first world countries, just how much demand for commodities will still exist in the emerging economies? I don't know the answer, but I know its not all as black and white as a lot of commentators would have us believe.
Thanks bjsaust – agree; no rush but remain active in researching the market for property for the right price…when it happens.
Yeah, listening to all these companies and "pros" does become confusing and disheartening – especially when one is trying to remain open-minded and become educated… as so many of the responses received for this post, have stated.
Derek- couldn't open link for article from M. Bouris.
Cheers!CatalystParticipant@catalystJoin Date: 2008Post Count: 1,404bjsaust wrote:My general feeling is there's no rush. Whatever's going to happen in the market, I find any kind of significant rise in the next two years to be very unlikely.
What!! You believe ALL of Australia will have no significant rise in the next 2 years? Won't happen. Guarantee it.
Sure some areas will under perform. I believe some may go backwards. But some areas will make gains (and some great ones at that).
And you can always make your money on the way in. That way you don't need top gamble on CG.