I read in the Courier Mail's What's your home worth?" section that our suburb's (North Gold Coast) prices have remained stable, but considering nothing is selling unless the vendors drop their prices, I believe the data isnt registering a drop because there are too little sales to impact the data. Anyone agree with this in their suburb
Dropping prices
- Thread starter fernfurn
- Start date
I wonder if Australia will see headlines like this one today in the UK. Nightmare or dream?
http://www.guardian.co.uk/business/2008/jun/09/housingmarket.houseprices
http://www.guardian.co.uk/business/2008/jun/09/housingmarket.houseprices
Joe
The media are running stories like the one above all the time so
there is a lot of fear in our markets today.
I can't comment on other cities but in Sydney we've seen many areas stagnate or come down to 2003 levels. That's a drop of 20% & more and if we also take into account an average of 3% inflation over 5 years, that's another 15% drop so in real terms we are down by 35% already.
In the meantime yields are improving, so opportunities are now starting to emerge.
I was looking on realestate.com.au the other day and it's not hard to find properties (particularly units) with yields up to 6%
Interest rates for investors are around 8.5% so if we consider the tax benefits then holding costs of such IP's will be very low.
To me low holding costs are important because if interest rates start to come down such IP's could easily become cashflow +ve.
I am not desperate to buy but I think it's time to selectively add to our Sydney portfolio.
Remember that when it takes 1 year to sell your house, you are now selling for the future price ( 1 year from now ). In other words, before you realize the houseprices have dropped, it's too late and you need to drop your asking price not by what everyone else is doing ( if you want to sell ) but at what everyone's selling -20%.
So , prepare for 50% price drops : The UK housing market is a lot healthier than Australia's housing market, so UK crash can only be shallower.
It's just that in the UK, people can't afford to work 3 jobs like in Australia.
And soon, when sickness and stress catch up with Aussies working 100 hours per week just to pay their mortgage interest, they will ask themselves "was it all worth it ?" and then commit suicide or get into crime, or drink themselves to death, or end up in the gutter, or maybe all of the above.
So , prepare for 50% price drops : The UK housing market is a lot healthier than Australia's housing market, so UK crash can only be shallower.
It's just that in the UK, people can't afford to work 3 jobs like in Australia.
And soon, when sickness and stress catch up with Aussies working 100 hours per week just to pay their mortgage interest, they will ask themselves "was it all worth it ?" and then commit suicide or get into crime, or drink themselves to death, or end up in the gutter, or maybe all of the above.
Hi all,
Scamp, in the famous words from the red head, please explain..
For the rest, you have got to be joking.
Again explain how hard it is for someone to afford this type of property???
http://www.realestate.com.au/cgi-bi...r=&cc=&c=65622080&s=vic&snf=ras&tm=1213023000
$189,000 for a 3 x 2 house is a no brainer. If you are talking about FHB purchasing something out of their league, then you may be right. But then again this has always held true.
bye
Scamp, in the famous words from the red head, please explain..
For the rest, you have got to be joking.
Again explain how hard it is for someone to afford this type of property???
http://www.realestate.com.au/cgi-bi...r=&cc=&c=65622080&s=vic&snf=ras&tm=1213023000
$189,000 for a 3 x 2 house is a no brainer. If you are talking about FHB purchasing something out of their league, then you may be right. But then again this has always held true.
bye
I wouldn't say that... have you checked the state of UK banks lately ? RBS just had the biggest rights issue in British history and the others are lining up and severely tightening their lending, in some cases completely withdrawing from the investor market.
And do you think Australian banks will be unaffected by the global crisis ?
( read : global ). When USA sneezes, Australia gets a cold.
And when China's economy plunges, Australia gets pneumonia.
Both are happening, it's just a matter of how deep the australian debt is.
The Reserve Bank has a LOT of leeway to stimulate the economy if it comes to that....
Imagine the effect of 3 or 4% rate cuts in the scenario you describe. That will go a long way towards getting things moving again.....
It is a buyers market - but only if you actually buy something! I'm not interested in doom and gloom just opportunities which are now out there.
Cheers,
Bazza
Sorry for Scamp
Why are you so down on the world, talking of 100 hour working weeks, 50% housing price drops, sickness, stress, "is it all worth it?", crime, drinking oneself to death, ending up in the gutter and committing suicide?
Why so sad and gloomy?
Have you thought of speaking to a psychologist to get some help?
Why are you so down on the world, talking of 100 hour working weeks, 50% housing price drops, sickness, stress, "is it all worth it?", crime, drinking oneself to death, ending up in the gutter and committing suicide?
Why so sad and gloomy?
Have you thought of speaking to a psychologist to get some help?
This person definitely needs help.
I think SS membership should become harder to get
because we have been invaded by sick GHPC members...
Hi skank,
You're GHPC user title says "Real Estate Developer"...
How's that going for you?
Regards,
JIT
Not true. You'll just get a stand off and stagnation.
Prices will only drop if people miss their repayments. This will only start to really happen if they lose their jobs, which is not the case right now. If we hit a recession, then sure.
Look, I just need this one property I am looking at, to drop by even half this amount and I would be laughing. Maybe I can hire the likes of Scamp, HG, YM et al to scare the crap out of the owner, to panic him and then he ca sell to me.
Fellas what do you charge?
Scamp....
Whoa Scamp - that's some really nasty stuff.
Why would you say that......oh, I guess I'm just playing into your hands because you are only after attention...not even any stats to back up your point.....
By the way, are you are still a kid in highschool who should be doing their homework rather than discussing investing on the net???
Whoa Scamp - that's some really nasty stuff.
Why would you say that......oh, I guess I'm just playing into your hands because you are only after attention...not even any stats to back up your point.....
By the way, are you are still a kid in highschool who should be doing their homework rather than discussing investing on the net???
Similar threads
