By: guy.longshank1
16/11/2009
4:26 pm Yahoo! Profile:
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Though certain properties in certain areas shall maintain value despite the pending economic collapse, many shall not.
For most people, the threat of realising a significant loss is real.
Are you confident that your retirement nest egg, (your home) is really the most reliable form of nest egg to hold? |
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By: jennyxuanwu
16/11/2009
7:47 am Yahoo! Profile:
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Hi jay,
Yes from what I know housing prices are coming down at top end of the market |
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By: jaymarcel
16/11/2009
7:41 am Yahoo! Profile:
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Hi Almurrie, You have hit the nail on the head there mate.
Jenny thanks for the link, he is correct up until one bit, house prices are still going up but he mentions them currently coming down. |
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By: almurrie1@y7mail.com
15/11/2009
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Ferret
Have you noticed normal house prices ARE about 3 times average wage. Unfortunately people want more that the standard 3 bed, and pay extra for it. The land the house is put on is a different matter. That's why it is called real estate. Real estate is about the land cost, the house part stays relatively the same with inflation. The land however goes up a lot when it is desirable to have, eg. big city close to the centre.
Al |
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By: jennyxuanwu
14/11/2009
8:55 pm Yahoo! Profile:
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Hello everyone!!
This is an American professor's insight on our "BULL" Australian property market.
http://www.theage.com.au/business/fall-in-housing- starts-to-impact-prices-20091110-i7qk.html
Sleep easy. |
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By: ralph.montegue
14/11/2009
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| Dear, dear lasty49.. I hope you will not mind my saying. But really! I would stay away from an YUM CHA that was prepared in the P. R. of China. Locally prepared YUM CHA is not only much tastier, it is also prepared in a much more hygenic manner. Communist YUM CHA may be your undoing my good fellow. |
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By: ferratuss
13/11/2009
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| house prices=3xave wage as rule in aus-now 9x ave wage due to lack of supply it,s a big fat bubble that has all levels of gov. collecting heaps while supporting their mates to boot.realestate is the economy and it props up goverments with20th century revenue streams and when it goes wrong as it will hello ireland iceland and latvia |
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By: mentawaisurf
13/11/2009
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The scene is set for a home construction boom after a record number of Australians rushed to take advantage of the First Home Owners Boost in September before the scheme was wound back from October.
In September more than 49,000 Australians took out mortgages for purposes other than refinancing, a seasonally adjusted record...
http://www.theage.com.au/business/boom-in-new-home s-on-the-way-20091109-i5d7.html
'Lambs to the slaughter' Meaning; In an unconcerned manner - unaware of any impending catastrophe.
All the FHOB (first-home owners bribe) has done is spark a short-sighted buying mania that has raised Australia's mortgage debt level to a new record high. |
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By: lasty49
13/11/2009
10:53 am Yahoo! Profile:
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Communistevil,
Its going to be very difficult for me giving up Yum Cha. |
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By: communistevil
13/11/2009
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Now is the time to acknowledge the dangers associated with our entertaining the idea of doijng business witht he evil and corrupt government fo the P. R. of China.
Recent as yet unconfirmed reports indicate that the P. R of China has been investing heavily in the property market so as to help inflate the property bubble which we all se growing at an ever increasingly alarming rate.
With fists full of USD, this cash rich COMMUNIST giant is now manipulating the property market here with only one clear intention in mind.
To help create a bubble and then burst it so as to destroy our economy and way of life.
"Ridiculous! Makes no sense!! C'mon. Why would they even think of doing such a thing?" I hear some ask.
The reason is all too clear to those who will STOP & THINK!
The evil & corrupt government of that communist state will create an economic disaster here of such proportions so as to benefit from it!
Yes!Benefit!
For when the disaster which we all know will soon occur doesindeed come to pass, ONLY they shall be cash rich and ready to pick up the pieces at bargain basement prices. And ONLY they shall be in the WINNERS corner.
They will ahve control. And we shall be at their mercy!
SAY NO TO DOING BUSINESS with the P. R. of China. STOP them from investing in our industries and prevent them from buying more property than they already own.
Alarm! Alarm!! |
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By: s_step000
11/11/2009
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"No if borrowed bulk of money as rent would go into interest & principal + owners additional contributions"
Return is defined on profit/capital outlay. Say you buy a house 500k. Say if you borrow 80% of total cost and all rents plus 3% pa of your capital go to interest payment and other expenses.
The original capital return of 60% still becomes 150% (since you lever by 4 times and spend extra 3%pa of your capital). This is even better than paying cash since your outlay is smaller. |
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By: pegasus2203
10/11/2009
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HI all!!
RBA and treasury agree on one thing:build housing
Is this the end of people rediculously expecting that housing prices will keep going up forever?
http://au.pfinance.yahoo.com/b/michael-pascoe/524/ rba-and-treasury-agree-build-housing |
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By: hdmausguy
10/11/2009
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| step - Of course we are'nt adding in costs like rates,repairs,insurance,l ost income through vacancy, agents fees (if you use one). If you had $420k would it be a better deal to take the average dividend of shares in the commonwealth bank for example, @7 -8%pa plus any capital gain? Certainly no contest when it comes time involved with the investment. Minimal with the CBA shares, lots more with a house etc. According to jay and others here, these investment houses are run at a controlled loss on borrowed money taking advantage of negative gearing. This allows taxation offsets on their other positive income. |
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By: hdmausguy
10/11/2009
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| step - good point. Yes 160% return if paid cash up front for house. No if borrowed bulk of money as rent would go into interest & principal + owners additional contributions. |
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By: s_step000
10/11/2009
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"Say the present owner bought the house now for $420k renting it for $380pw and in 15 years found that house values had slowed and his gain was only 60%. "
Out of curiosity. Is the gain of "60%" include the rental return? In general the rental yield is about 5% pa. This rental return itself give you about 100% return in 15 years. Combine with capital gain become 160% return. |
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By: jaymarcel
10/11/2009
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It's a tricky one as somethings cause inflation to go up & somethings go up due to inflation, there is a bit of a chicken/egg arguement here.
One thing I will agree with you is rent as a rule is tied to property prices but as we know things are changing & with property becoming more & more out of reach this could cause a further rise in rents, even if property prices reach their affordable limit. |
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By: hdmausguy
10/11/2009
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| jay - I would imagine that rents would be tied into property prices yes/no? Take a rented house in my street in the suburbs west of Parramatta(central west metro Sydney) Mostly these 3br fibro/clad houses rent in the $360 - $380pw range. Recent sales around $420K. Similar 3br houses in low or negative growth country towns rent for $150 - $160pw & many sell for $180k or less? So surely the value of the house is the main factor in the price the property owner charges for the rent. Using the house in my st. as an example. Say the present owner bought the house now for $420k renting it for $380pw and in 15 years found that house values had slowed and his gain was only 60%. His rental income was then $610pw. General inflation had gone up by 100%. Over the previous 15 years should he have been increasing his rents in line with inflation so that he would then be receiving $760pw? |
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By: jaymarcel
10/11/2009
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hdmausguy, I would say no, but I'm sure a few would have a go at using that method of calculation.
Don't forget rents would have gone up with inflation too, wouldn't they? |
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By: tesseract91
10/11/2009
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House prices to drop 40-50% ???
I don't know what this guy is smoking but I wish that he would share it with the rest of the class! |
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By: lasty49
10/11/2009
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hdmausguy,
It depends if wages have kept up with inflation and what actually is the driving component of the inflation.
The cost of utilities and grocery prices have increased yet inflation has fallen.
Ask a pensioner are they seeing any relief from deflation? |
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By: stevebwilson1
10/11/2009
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There is a place for dreams.
There is a place for reality.
The facts speak for themselves.
Though stimulus measures introduced worldwide have indeed managed to prevent a more destructive economic collapse than might have otherwise ocurred to date.These same "STIMULUS" measutres have FAILED to stimulate a REAL RECOVERY.
And so, it is only a matter of time until the market conditions adjust to a level which may be supported by the real economy.
Such an adjustment shall occur as the measures implemented by government are withdrawn and the economy like a new born is left to stand on its own two feet.
What a shame it is that those two feet are not strong enough to support the weight of the economy!
EXPECT HOUSE PRICES to DROP dramatically.
It is inevitable. |
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By: hdmausguy
10/11/2009
11:54 am Yahoo! Profile:
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| I'm not into economics but if say in 15 years time inflation has risen 100% & properties have gone up 60% in that same time period,does that mean property values have effectively fallen 40% ? |
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By: hdmausguy
10/11/2009
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| Two references to property in Australia. Elite traders send me a weekly market wrap sheet. Part of their blurb was a reference to failed property group City Pacific. 12 months ago they had an office block on the market for $15 million which has just been sold for $9.5 million. It then mentioned "Plenty more of these time bombs waiting to go off"? & "Commercial Real Estate market in Australia is just as sick as America's'. On 2UE radio they made a brief reference from THE ECONOMIST that property prices in Australia would decline 40% over the next 15 years? I could'nt find the article as THE ECONOMIST is a subscription outlet? |
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By: sly.guy_nsw1
7/11/2009
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Robert Prechter Warns
Take a look!
Good night.
Hopefully, your dreams will be sweet..... |
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By: billy_tiut
6/11/2009
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I would like to add here, I agree that the house price will not fall, reason is simple -> getting a finance in Australia is quite hard.
I had a finance approval and let me tell you the way that you need to convince the lender and get the loan is really hard. There are so many paperwork and they even check your credit rating, for instance if you once get unemployed and get the money from Centerlink you will not get approved even you already back to normal and get the job, because centerlink bring down your credit rating.
Just looking at that, it will be unlikely the house price will fall. It will go up at a slower pace, because remember Australia a resource driven country and we are tight to China and India now which is good.
And we are in oil and gas boom rather than mining boom and my friend look at Chevron Gorgon project, that field alone has life of 50 years, it will add more prosperity into Australia and WA in particular. Plus Uranium and massive NWS gas project by Woodside, INPEX, and Shell.
I believe Australia is very unique because it's a western country but have more Asian influence. |
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