Australian house prices should rise over 2011-2012

Then, he says, that remaining 13% can be attributed to financial regulation and less-quantifiable examples including changes in tax conditions and "the overall impact of deregulation which moves from a system of rationed credit... to one that uses debt facilities to use credit"


watchu talkin about Willis?

all I can hear is *I really can't explain why prices won't fall at least 13% but I am employed by ANZ* credit rationing and financial stability and the role of the reserve bank with all time high affordability due to broader availability of debt facilities and all time low interest rates. Who cares about debt when credit isn't being rationed anymore (apparantly:confused:)
 
watchu talkin about Willis?

all I can hear is *I really can't explain why prices won't fall at least 13% but I am employed by ANZ* credit rationing and financial stability and the role of the reserve bank with all time high affordability due to broader availability of debt facilities and all time low interest rates. Who cares about debt when credit isn't being rationed anymore (apparantly:confused:)
Not a great article but i guess it's not feasible for them to cover the whole 14 page report. The report talks about the difficulty in using various economic modelling to explain house prices, which we know has been the 'new black' in recent times. The 13% overvaluation model in the report includes various structural factors such as deregulation, global credit growth, etc. The report does not say that property will or will not go down 13%. It does say that people supposing that property will 'revert to the mean' is, as I have said for some time, a wish rather than reality. Econometric factors are necessarily quantifiable and the factors affecting propert prices are not. The inputs are multi-factorial and changeable and, MOST importantly, property is not purely an investment play. Even the best econometric model can not explain the behaviour and aspirations of human beings. Especially in the over 70% of purchases that are PPORs.
 

his final paragraph:
To me, the most disappointing aspect of the ANZ's commentary is that it builds upon the common misconception that house prices in Australia are a one way bet - that the only way is up. In turn, this type of commentary invites greater investor speculation and encourages first-time buyers to leverage-up and purchase a home before they 'miss out'. But with house prices already severely overvalued by every measure, and Australian households amongst the most indebted in the world, you have got to ask yourself whether such encouragement is warranted and in the national interest?

* Historical data says that the "common misconception" is in fact true.
* How does commentary from banks or anyone in particular influence house prices...? Really...?
* house prices severly overvalued by every measure....by only some "unconventional economists" but not by the RBA and other data providers.
* in the national interest...LOL... our saviour...c'mon...really..:rolleyes:

I've said it before, the market is the market is the market and no-one or group can influence it's direction....it's a conglomerate of supply and demand from all and sunder who participate at any one time and people will buy when it suits them and sell likewise. On the edges you will always have people paying too much (or god forbid too little) for property depending on their level of DD or heartstrings factor.

This guys thinks it's all a conspiracy totally designed and setup by a certain few for their own greater good....you've got to be kidding me...get over it and don't try to make the market, it will not happen, it's way bigger than you or anyone in particular.
 
his final paragraph:

* Historical data says that the "common misconception" is in fact true.
* How does commentary from banks or anyone in particular influence house prices...? Really...?
* house prices severly overvalued by every measure....by only some "unconventional economists" but not by the RBA and other data providers.
* in the national interest...LOL... our saviour...c'mon...really..:rolleyes:

I've said it before, the market is the market is the market and no-one or group can influence it's direction....it's a conglomerate of supply and demand from all and sunder who participate at any one time and people will buy when it suits them and sell likewise. On the edges you will always have people paying too much (or god forbid too little) for property depending on their level of DD or heartstrings factor.

This guys thinks it's all a conspiracy totally designed and setup by a certain few for their own greater good....you've got to be kidding me...get over it and don't try to make the market, it will not happen, it's way bigger than you or anyone in particular.

I find it highly ironic you have supply and demand in your signature...
Basically 90% of the people on this board have a vested interest to stick their head in the sand...our market is not different, govt manipulation and tweaking will eventually be corrected by Mr Market, im happy being liquid placing my funds in investments that make sense.

- If your basing your view on the market based on historical prices I say good luck to you...
- RBA and other authorities have a biased viewpoint where they have to remain positive, banks and the system are very vulnerable to a significant housing correction
 
see below...

I find it highly ironic you have supply and demand in your signature...so ironic in fact that there is currently a large demand over small supply...or don't you believe that...? Would you like me to change my sig then...?

- If your basing your view on the market based on historical prices I say good luck to you... Im basing that historical prices are correct, are you basing it on hist prices being a lie...?
- RBA and other authorities have a biased viewpoint where they have to remain positive, banks and the system are very vulnerable to a significant housing correction...yes that's right...you're spot on...!
And you have a biased viewpoint because you want lower prices...are you not displaying a vested interest too...?

Maybe we should create a poll on how many posters on here have their heads in the sand...I don't believe your figures of 90%...:D
 
..oh, forgot about this one...

im happy being liquid placing my funds in investments that make sense.

so what are your investments that make sense pls...?

My investments (IP's) make perfectly good sense to me, I'm sorry if you don't understand.

Maybe you could have a good look around on here, delve a fair bit deeper into the many success stories here for the record and gain some 'sense' into property investing....just a suggestion, many here are happy to help.
 
Arrrgghh, not again?

Yes, we know that you are superior to all the Average Joes, whitegoodman.
In theory, it should work in practice. In practice, not necessarily so.
 
The 13% overvaluation model in the report includes various structural factors such as deregulation, global credit growth, etc.

I have no idea whether property will go up down or sideways, but I find it hard to let go of this 13% thing... it is such a vague lot of gobbledegook. Deregulation meaning... loose lending standards? Global credit growth... um... huh? are they agreeing that there is a credit bubble?

Oh well presumably the report goes into more detail and some comfort is provided there.
 
..oh, forgot about this one...



so what are your investments that make sense pls...?

My investments (IP's) make perfectly good sense to me, I'm sorry if you don't understand.

Maybe you could have a good look around on here, delve a fair bit deeper into the many success stories here for the record and gain some 'sense' into property investing....just a suggestion, many here are happy to help.

:) you make me smile
 
I have no idea whether property will go up down or sideways, but I find it hard to let go of this 13% thing... it is such a vague lot of gobbledegook. Deregulation meaning... loose lending standards? Global credit growth... um... huh? are they agreeing that there is a credit bubble?

Oh well presumably the report goes into more detail and some comfort is provided there.
You're right; the article makes this v. unclear. It's easier to understand in the report, and the significance of the 13% is that this is as high a figure as they could come up with trying to model 'overvaluation' of the market based on econometric factors. As opposed to the 40%+ or whatever that some people come up with based on income alone. I can't find a link to the full report but I can email it if anyone's interested.
 
This arguement has so many different angles you can look at it from. Its quite facinating.

Probably one thing that i did take away from the article is to make sure i've got enough funds in the bank to cover repayments on loans if costs are to rise sharply and stay their for awhile.

Hopefully we can make others see the importance of having a safety net
 

Err, do you mean me, DB? If so i have no idea what you mean, nor how the article you posted is relevant to the ANZ report which, coincidentally, does not make a case for a rise in house prices. :confused:
In fact, neither have I attempted to make such a case. I have no idea what will happen & my guess is the same as most - flat to slight decline. In fact I am more negative in recent times given that the international cost of funds is blowing out again. I note the risk of bank IR increases independent of the RBA is still a real possibility.
 
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