http://www.thebull.com.au/articles/a/30333-aussie-property-decline-mirrors-japan.html
While I think the comparison is greatly exaggerated, there are a few unavoidable truths in there…for me, though, the main reason to stay in Japan has and will always be the cash flow. Even if capital gains could be guaranteed (and they can't), the cash flow in Japan (x3-4 greater on average) just can't be beat.
Ziv Magen- Manager, Asia-Pacific
NTI – Global Real Estate
Ziv Nakajima-Magen | Nippon Tradings International (NTI)
http://www.nippontradings.com
Email Me | Phone MeZiv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property
I'm a bear for Australian property but even I have to admit that the article is seriously grasping at straws. I saw those exact same plots a few years ago when Aus prices were "trending" with the U.S prices post GFC and saying how we were also heading for "the cliff".
Hindsight shows us that didn't happen, we didn't follow the U.S down so now that has been debunked, they're saying we're following Japan? Look at the gradient differential at the intersect, its an even bigger stretch now.
One thing I believe is that once people start resorting to real graphs rather than nominal to get their point across they are employing a kind of scare tactic to make the numbers look worse and influence people. Unless you have your capital locked away in gold, your money is subject to inflation too, so presenting "real" graphs just distorts the picture to the downside.
That said, I believe capital gains in Australia will be limited for the next few years but we don't have 100 year mortgages like Japan had pre-pop. Not to mention their sharemarket crash…
Quite correct, no argument there. As I mentioned, it's mainly the cashflow that makes the difference in my view.its getting very difficult to obtain positively geared properties for the long term in Australia.
Ziv Nakajima-Magen | Nippon Tradings International (NTI)
http://www.nippontradings.com
Email Me | Phone MeZiv Nakajima-Magen - Partner & Executive Manager, Asia-Pacific @ NTI - Japan Real-Estate Investment Property
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