Booming property market
- Thread starter PEI
- Start date
see-change, I agree. People have ingnored this fact!
I have lived in such an area for the past 12 years, (outer suburbs of Melb) Its really only the last 2 to 3 years our ppty has increased in value. I guess the old saying that house prices double every 7 to 10 years is true, but if you had of asked me that 3 years ago it would of been a different story. Our PPOR has only really just caught up. If the bubble burst, I think our ppty will just flat line again at this price until the next boom, and so on, and so on.
How about Immigration!! Personally I think its a biggie. They say that about 1000 people per week move to Sydney, if one out of two families pump 250k into the market at some stage (even if borrowed funds), and assuming 4 people per family, thats an average of 31 million per week extra entering the market!!!
Sanchez
Sanchez
The house prices are catching up all right, not only has it catched up to what it suppose to be but it's going even more hardcore. With these prices, the market is going further than a standard catchup, it's going to "insane" levels. The only people who will be able to afford loan repayments soon are doctors and dentists.
This catchup this is like a little boy who hasn't been fed for days, now he wants to eat a good meal but wants to eat more than he can feed. What he ends up will be a stomach-ache (bust).
When that happens, people like me will go after the aftermath of his broken up food...
This catchup this is like a little boy who hasn't been fed for days, now he wants to eat a good meal but wants to eat more than he can feed. What he ends up will be a stomach-ache (bust).
When that happens, people like me will go after the aftermath of his broken up food...
Are you suggesting that in the past 5-7 years when housing prices were very affordable, no one was moving into Australia? Surely each year there is slight increases, that's with most cities around the world. That doesn't warrant a boom. This may be a small factor but I don't think it's the main one. Furthermore, our currency has skyrocketted recently, thus making it less affordable for oversea investors and rich immigrants who bring in their money.
Hi np2003,
I just have a few of questions regarding your last 2 posts, and wondering if you can help explain a couple of things...
Catching up to what? Not sure what you are referring to here...
What is it supposed to be? Again, what are you referring to? Where are prices supposed to be? Which market / particular part of the country are you referring to?
Can you explain what's "going hardcore"? And where is this happening?
What is an insane level? Obviously for a house to be sold at such a level, someone else must have bought it.. Im intrigued as to how you define this...
Hmmm... not sure where you got this one from... I know numerous people, both on this forum and otherwise, who are in the process of buying a minimum of a property every 6 months for both the past few and the next few years... and not one is either a doctor or a dentist... just wondering how you arrived at this statement...
Interesting analogy, if somewhat trite... dont most "boys" with a stomach ache simply rest until they are ready to eat again?
How many actively burst at the seams, rupturing a stomach lining and have to be rushed haemorraging to an emergency department? Isnt that more along the lines of your "bust" analogy? Wouldnt a simple stomach ache be more akin to a levelling out of hunger until the boy is ready to eat again?
I particularly liked this bit, if only because your logic so completely escapes me...
Can you tell me who "people like you" are? In no way do I mean to attack you personally, but I cant understand your perspective... from what Ive read previously:
(a) youre in your early 20's,
(b) you own NO investment properties,
(c) you earn an amount of money such that you refrained from listing your wage in a thread you started, asking other people to tell you what they earnt; and
(d) you just paid 47k for a car...
Im intrigued as to why people like you will be picking up the pieces from myself and numerous other I know who are putting in offers on property as we speak...
Best wishes,
Jamie
I just have a few of questions regarding your last 2 posts, and wondering if you can help explain a couple of things...
Catching up to what? Not sure what you are referring to here...
What is it supposed to be? Again, what are you referring to? Where are prices supposed to be? Which market / particular part of the country are you referring to?
Can you explain what's "going hardcore"? And where is this happening?
What is an insane level? Obviously for a house to be sold at such a level, someone else must have bought it.. Im intrigued as to how you define this...
Hmmm... not sure where you got this one from... I know numerous people, both on this forum and otherwise, who are in the process of buying a minimum of a property every 6 months for both the past few and the next few years... and not one is either a doctor or a dentist... just wondering how you arrived at this statement...
Interesting analogy, if somewhat trite... dont most "boys" with a stomach ache simply rest until they are ready to eat again?
How many actively burst at the seams, rupturing a stomach lining and have to be rushed haemorraging to an emergency department? Isnt that more along the lines of your "bust" analogy? Wouldnt a simple stomach ache be more akin to a levelling out of hunger until the boy is ready to eat again?
I particularly liked this bit, if only because your logic so completely escapes me...
Can you tell me who "people like you" are? In no way do I mean to attack you personally, but I cant understand your perspective... from what Ive read previously:
(a) youre in your early 20's,
(b) you own NO investment properties,
(c) you earn an amount of money such that you refrained from listing your wage in a thread you started, asking other people to tell you what they earnt; and
(d) you just paid 47k for a car...
Im intrigued as to why people like you will be picking up the pieces from myself and numerous other I know who are putting in offers on property as we speak...
Best wishes,
Jamie
Hi all,
I agree with Jamie. I believe there will be good buys to be found no matter what the rest of Australia (esp the media) are harping about real estate at any particular time. I dont believe there is a market analogy with property as there is with shares, and for this reason disagree that property prices can be compared with previous trends. You never know what someone might be prepared to pay for a property.
What Im getting at is, things increase in value by their ability to be bought. At the moment property is very easy to buy. All you need is a full time job and an internet connection and you can buy property almost anywhere in Australia. And if you have some equity its even easier - and majority of households do.
-Just my 3c (it just went up)
Dave
I agree with Jamie. I believe there will be good buys to be found no matter what the rest of Australia (esp the media) are harping about real estate at any particular time. I dont believe there is a market analogy with property as there is with shares, and for this reason disagree that property prices can be compared with previous trends. You never know what someone might be prepared to pay for a property.
What Im getting at is, things increase in value by their ability to be bought. At the moment property is very easy to buy. All you need is a full time job and an internet connection and you can buy property almost anywhere in Australia. And if you have some equity its even easier - and majority of households do.
-Just my 3c (it just went up
)Dave
Yes I agree with everything that has been said on the subject. I'd just like to say that my wife and I are baby boomers and like all of the other baby boomers out there we really did not have a plan up until about four years ago. It seemed to us we were not going to have anything for retirement except our own house and so we bought a couple of ips. I must admit the bug didn't really hit us until about four months ago when we realized what property can do for us. So we started reading as many books and joing forums like this to learn from other people. I glad we did, but one thing we do know is that we wished we had started when we were young. It is true that most of us baby boomers are panniking about retirement and that panic is still going to happen for a while yet when all of us realize time is running out to accumulate wealth. To you young people I would say to save money at all costs and invest asap. The compounding that occurs once you start is absolutly incredible. In a few short years we now have 6 ips and climbing. Good luck everyone.
NP 2003
It's a big factor in Sydney when we are running out of land. I am not suggesting that that no-one moved into Australia in the last 5-7 years, but it didn't make as much of an impact when there was more supply.
Immigrants don't necessarily have to bring big bucks with them, but they still need somewhere to live - whether they rent and provide demand for rental housing or buy, they are still taking up supply.
Sanchez
Agree with all of the above and wish to add another one: Greed. Or, put another way, fear of missing out.
As the boom has continued, people have seen $40K properties become $150K properties, $200K properties become $400K properties etc.
They get excited at the prospect of earning what could be the equivalent of several years of income due to capital growth, jump in and buy property at any price thinking the present growth will continue no matter what, determined to get their share of the "cream" like everyone else is.
As the boom has continued, people have seen $40K properties become $150K properties, $200K properties become $400K properties etc.
They get excited at the prospect of earning what could be the equivalent of several years of income due to capital growth, jump in and buy property at any price thinking the present growth will continue no matter what, determined to get their share of the "cream" like everyone else is.
You're right, Im in my 20's have no IPs, infact my knowledge of investment is fairly limited. The only thing I have going for me is my business which I plan to devote all my time and energy until the housing market dies down (when there is a boom there is a bust). AFter that time I will be jumping into investment properties full-time, at the moment I am here just to gather information and research.
I have a few friends who have various properties, two or three of them own a few hundred million dollars owth of commerical properties and about 20-30 IPs. They have told me that they not buying any properties at the present moment and are holding out at this period.
Like I said I'm a newbie with no IPs, but when I have friends who have $300-$400 million worth of properties telling me its a bad idea to buy at the moment, then I surely will follow them.
At the present moment, no-one know's what's going on in this industry. There have been all sorts of predictions which have been wrong. There is so many conflicting issues which don't add up. The only thing I plan to do at the moment is buy a piece of land, build a house and just rent out my current one.
I have a few friends who have various properties, two or three of them own a few hundred million dollars owth of commerical properties and about 20-30 IPs. They have told me that they not buying any properties at the present moment and are holding out at this period.
Like I said I'm a newbie with no IPs, but when I have friends who have $300-$400 million worth of properties telling me its a bad idea to buy at the moment, then I surely will follow them.
At the present moment, no-one know's what's going on in this industry. There have been all sorts of predictions which have been wrong. There is so many conflicting issues which don't add up. The only thing I plan to do at the moment is buy a piece of land, build a house and just rent out my current one.
yes, yes, yes to all of the above and from a personal point of view, the reason for moving out of shares into investment property is that I am sickened by the obscene salaries of CEOs of companies that I had shares in...eg. CBA...Mr Murray gets a whopping bonus for cutting 3700 jobs. AMP pays 13 million to get rid of George Trumball...all of this was money belonging to ME and fellow shareholders. No thanks! you can have the share market, give me good old bricks and mortar.
The one rule of investing I have learnt from my parents, who are now elderly and living off the income from several investment properties....buy real estate and HANG ONTO IT!!
The one rule of investing I have learnt from my parents, who are now elderly and living off the income from several investment properties....buy real estate and HANG ONTO IT!!
Hi np2003
Just a thought.
Did your friends with "$300-$400 million worth of properties" tell you in the last few years that it was a good time to buy properties, or did they just do there own thing at the time. ?
Also, your quote - "(when there is a boom there is a bust)" Whos quote is that? Is it related to properties, or stock exchange
jahn
Just a thought.
Did your friends with "$300-$400 million worth of properties" tell you in the last few years that it was a good time to buy properties, or did they just do there own thing at the time. ?
Also, your quote - "(when there is a boom there is a bust)" Whos quote is that? Is it related to properties, or stock exchange
jahn
I seem to recall reading at some time on this forum that if you find the right property for your investment aims, then any time is a good time to buy.
For the lets-hop-on-the-bandwagon 'investor' type, of which there are probably more around at the moment than ever, this is probably not the best time to buy. But hey! If they have plenty of cash sitting idle and they buy in an area with historically good CG, then this, IMHO, is just as good a time to buy as any - and HANG ON TO IT
Desto.
For the lets-hop-on-the-bandwagon 'investor' type, of which there are probably more around at the moment than ever, this is probably not the best time to buy. But hey! If they have plenty of cash sitting idle and they buy in an area with historically good CG, then this, IMHO, is just as good a time to buy as any - and HANG ON TO IT
Desto.
Hi XbenX
I'm a bit slow on replies due to distractions, but I'll have a go at explaining my previous post.
"Hrmmm - Jahn - have a look at some long term growth charts for the property market. Like other markets the property market is cyclical and follows a boom/bust pattern."
Agree with above, but not to the same degree as Stock market. Yes there are and always will be areas, types of property that suffer, but with the long term growth charts that I have seen, there does not appear to be the "bust" part of the cycle that can be seen in stock market.
I don't wear rosie coloured glasses either but many, many people were caught in the collapses of the likes of HIH, Worldcom, etc.
Iwas thinking along the lines of 'correction' generally applylng to property, rather than 'bust'. ( I know the people caught in Melbourne by the developer who went bust, wouldn't agree with that)
BTW Went to "Perisher" for 1 week, 1 month ago and am still getting over it. (These addictions are easy to form and hard to shake,
jahn
I'm a bit slow on replies due to distractions, but I'll have a go at explaining my previous post.
"Hrmmm - Jahn - have a look at some long term growth charts for the property market. Like other markets the property market is cyclical and follows a boom/bust pattern."
Agree with above, but not to the same degree as Stock market. Yes there are and always will be areas, types of property that suffer, but with the long term growth charts that I have seen, there does not appear to be the "bust" part of the cycle that can be seen in stock market.
I don't wear rosie coloured glasses either
but many, many people were caught in the collapses of the likes of HIH, Worldcom, etc.Iwas thinking along the lines of 'correction' generally applylng to property, rather than 'bust'. ( I know the people caught in Melbourne by the developer who went bust, wouldn't agree with that)
BTW Went to "Perisher" for 1 week, 1 month ago and am still getting over it. (These addictions are easy to form and hard to shake,
jahn
o/t as usual
Its hard to get over it =)
Its even harder for me now - my first weekend in Sydney in a long time - my season was cut two weeks short by a nasty hospital visit.
Fortunately with a bit of surgery and a bit of added metal, 12 weeks and ill be typing with two hands again
Ill no doubt have the itch by then again just in time for a BC adventurer.
Its hard to get over it =)
Its even harder for me now - my first weekend in Sydney in a long time - my season was cut two weeks short by a nasty hospital visit.
Fortunately with a bit of surgery and a bit of added metal, 12 weeks and ill be typing with two hands again
Ill no doubt have the itch by then again just in time for a BC adventurer.
