This Character can't make up his mind.
http://www.news.com.au/business/money/story/0,28323,25378732-5013951,00.html
http://www.news.com.au/business/money/story/0,28323,25378732-5013951,00.html
Fhog May Be Extended
- Thread starter lostis
- Start date
Maybe it was one of those pre-budget 'leaks' to guage consumer (read voter) sentiment.
i was suprised yesterday when the media released what krudd was supposed to have said.........i would have thought the unions would have been pushing big time behind the scenes to keep the additional funds in place.
personally i hope its pulled and the market can get back to normal instead of being artificial.
the market cannot sustain current housing prices, it needs to slide and correct somewhat be it slowly to give entry to real investors once again.
investors wont return in droves unless there is value in their purchase...theres not a great deal of value currently in net returns in many areas still unless you are lucky enough to pick up a gem.
personally i hope its pulled and the market can get back to normal instead of being artificial.
the market cannot sustain current housing prices, it needs to slide and correct somewhat be it slowly to give entry to real investors once again.
investors wont return in droves unless there is value in their purchase...theres not a great deal of value currently in net returns in many areas still unless you are lucky enough to pick up a gem.
I'm sitting on the fence with this one.
Whilst I can see where most on SS are coming from in saying that investors won't return in big numbers until the frenzy is over, I know that most investors own just one property, and aren't all that clued on about what they're doing, plus, most also buy when the market is booming, the opposite of what experienced investors will do.
Who knows.
Whilst I can see where most on SS are coming from in saying that investors won't return in big numbers until the frenzy is over, I know that most investors own just one property, and aren't all that clued on about what they're doing, plus, most also buy when the market is booming, the opposite of what experienced investors will do.
Who knows.
Mr Rudd has played all the right cards so far,and imho there is no way the FHOG will be axed,they will just bring in something different and not not before the next election which is not that long away,every one i talk too think Mr Rudd is doing a good job,even with 60 billion in the gutter, which all of us will have pay for in one way or another..
imho willair..
imho willair..
What they should do & what they will do?
IMO the FHOB did stimulate the RE market - no doubt. It brought forward many budding FHBs into the market earlier than they could have saved a depposit - fine. They still had to prove serviceability which they did to get the loan. This was/is all good.
The downside was too much demand and too little supply and this pushed up prices by up to 10% in the lower quartile of prices wherever FHBs were active. Also from what I have observed many FHBs purchased property in a panic and did not do DD and have ended up with a less than optimal property. Also investors used this opportunity to dump their dog properties onto the market and did well to sell them at premium prices.
My view now is that the FHOB (boost) should be changed to support the construction of new property. There is no point in continuing to give free money to ppl to buy existing house stock which is already in short supply as this will continue to fuel price pressure. Much of the money used by FHB was not used to buy or construct new homes. The economy would be better served by leaving the FHOG of $7K in place but boosting that by another $7+K for the construction of new IMO. This flows onto all the tradies and manufacturers etc.
IMO the FHOB did stimulate the RE market - no doubt. It brought forward many budding FHBs into the market earlier than they could have saved a depposit - fine. They still had to prove serviceability which they did to get the loan. This was/is all good.
The downside was too much demand and too little supply and this pushed up prices by up to 10% in the lower quartile of prices wherever FHBs were active. Also from what I have observed many FHBs purchased property in a panic and did not do DD and have ended up with a less than optimal property. Also investors used this opportunity to dump their dog properties onto the market and did well to sell them at premium prices.
My view now is that the FHOB (boost) should be changed to support the construction of new property. There is no point in continuing to give free money to ppl to buy existing house stock which is already in short supply as this will continue to fuel price pressure. Much of the money used by FHB was not used to buy or construct new homes. The economy would be better served by leaving the FHOG of $7K in place but boosting that by another $7+K for the construction of new IMO. This flows onto all the tradies and manufacturers etc.
100% spot on...inflation when it kicks in is going to test FHB'ers repayments with interest rates rebounding to compensate for inflation..A way off yet but we may see a definite downturn when that happens.
My view now is that the FHOB (boost) should be changed to support the construction of new property. [/QUOTE]
Id commence building 3 or 4 new properties straight up if there was a "real" incentive to do so from the state and federal govt.....waive stamp duties, better tax incentives on new home buildings by anyone just now FHB'ers........
That would definitely kick the building market along and may ease the rent stress with prices at ridiculous levels....
Many investors are currently making an absolute killing with rents on property they own outright or purchased many years ago..its all cream! rightly earned by investing wisely!
Investment is long term, sit and hold usually reaps rewards..unfortunately i dont operate that way personally...i buy and sell depending on the market conditions..
Id also like to see the govt bring in legislation regarding employees who work overtime give tax breaks..also those casual employees who are holding down two jobs to pay the bills given breaks with tax..as it stands now they are taxed way to heavy....
mind you this wont be happening in the current economic climate.....definitely the reverse will be trust upon us...up the taxes for sure to try and recover some debt....
Sorry, I don't agree in seeing a downturn..but that's just me.
Sorry, I don't agree with rents being at "ridiculous levels" either. Rents have merely risen to get back to the 5.x% gross yield they always trend to. It is just part of the whole cycle.
House prices boom
Rents fall to 3-4% yield based on the increased prices
Rents gradually increase over time while house prices stay flat
Rents grow and overshoot their 5% trend level
You see adverts saying "Why rent when you can buy for same money?"
People buy
House prices boom
The cycle starts again..........no different this time IMO.
Well Yes - well said. But it will always be that way if you compare rental yield to purchase price of a long time ago.
Yes, unfortunately your buy & sell strategy is a trading strategy not an investment strategy.
I agree. I'd even go as far to say that I'd like to see PAYG tax eliminated altogether in favour of a higher GST on consumption of everything with compensation payments increased for those on welfare. That way you could earn your socks off & save (novel idea) and only pay tax as you spend. But this is a bit off topic.
I wander if there will be a first investor buyer grant. There was some talk of that. That would be cool if that came in! I could use the $7 K as half of my deposit. Anyone have any links to where this was discussed before?
I'm sure if you read that somewhere it would have been a joke.
Otherwise I'll have some cash to buy some Lihir thanks
no im sure i did, anyway gotta go in a minute, lunch over. will do a search tonight
hi propertyunity
lordable idea and was the reason that the uk got vat( same as our gst) the idea was to bring in vat and increase it with a decrease in income tax
sounds as yours does to be great
well whats wrong with it
they increase the vat or gst and just forget to reduce income tax
or they do it in two stages gst up and then the next lot come in spend the spare cash and then it has to go up again.
polys have a problem they just can't reduce a tax if its there it has one way and one way only and thats up
the fhog is here to stay as long a mr rudd wishs to have that hes a great guy thing
and yes we will all pay for it but it the same with any party
if you start drinking at 4 in the arvo at about 10 you will shout anyone a drink and thats where we are now
by 1.0 in the morning your out of cash
thats about 1.5 to 2 years from now
and then 3,00 you wake up( about 3 years from now) and say oh my god what did I do last night or in mr rudd case people will say oh my god did we waste that much money
and we will have one hell of a hang over
I am looking forward to july
because I see a wave comming after the funds report and the fhog will be the only thing that will be a well we still have this
lordable idea and was the reason that the uk got vat( same as our gst) the idea was to bring in vat and increase it with a decrease in income tax
sounds as yours does to be great
well whats wrong with it
they increase the vat or gst and just forget to reduce income tax
or they do it in two stages gst up and then the next lot come in spend the spare cash and then it has to go up again.
polys have a problem they just can't reduce a tax if its there it has one way and one way only and thats up
the fhog is here to stay as long a mr rudd wishs to have that hes a great guy thing
and yes we will all pay for it but it the same with any party
if you start drinking at 4 in the arvo at about 10 you will shout anyone a drink and thats where we are now
by 1.0 in the morning your out of cash
thats about 1.5 to 2 years from now
and then 3,00 you wake up( about 3 years from now) and say oh my god what did I do last night or in mr rudd case people will say oh my god did we waste that much money
and we will have one hell of a hang over
I am looking forward to july
because I see a wave comming after the funds report and the fhog will be the only thing that will be a well we still have this
You are of course quite correct GR. Look what happened when they introduced the gst and then 'forgot' to reduce all the other state taxes and stamp duties that were supposed to be removed over the years following.
Yes, and that's the other probelm with any tax, icluding the gst. Once in place, as it is, when the govt. needs more cash, you just go to the gst and rachet it up a notch. Actually, that was my main opposition to it back in 2000 - the fact that successive govts can just increase it as needed.
I am really surprised that the GST rate has remained at 10% for this long - maybe I shouldn't talk too loudly.
You are of course quite correct GR. Look what happened when they introduced the gst and then 'forgot' to reduce all the other state taxes and stamp duties that were supposed to be removed over the years following.
Yes, and that's the other probelm with any tax, icluding the gst. Once in place, as it is, when the govt. needs more cash, you just go to the gst and rachet it up a notch. Actually, that was my main opposition to it back in 2000 - the fact that successive govts can just increase it as needed.
I am really surprised that the GST rate has remained at 10% for this long - maybe I shouldn't talk too loudly.
An increase in the GST needs to be endorsed by all the States as well as the Commonwealth. The fact that it has not been increased since its introduction is a good indication that the statutory criteria to increase the GST is very problematic for any Federal government. In fact, it was far easier to raise indirect taxes under the previous model.
Another reason why the government wants you to continually spend your so-called 'bonus'
I did not know this - not my area of expertise at all
But if it is as you say, then I would have thought that with Labor Govts all round, both state & federal, it would be an easier task. (Do we still have all state Labour govts?)It might be less "problematic" when we get out the other side of the GFC and see the massive debt (wisely
limited to $200B by K Rudd according to the news this week) that has to be repaid - or at least serviced I did not know this - not my area of expertise at all
Libs/Nat in WA only.
It might be less "problematic" when we get out the other side of the GFC and see the massive debt (wisely
Now they're talking about increasing this 'borrowing limit' to $300 billion! It won't be just our children and grandchildren who'll be paying for this, but our great-grandchildren, too!
Cheers
LynnH
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