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I keep hearing that property doubles every 7 to 10 years however have not been able to get my head around it. It doesn't add up for me, especially if wages don't keep pace.
Does anyone have a history of house prices for capital cities for the last 100 years?
Thanks
the median price they refer to.
Lowell,
The 'doubling every 7 - 10 years' thing is usually a line trotted out by people wanting to flog you an investment property. And it's easy to do a graph or something that proves median prices have done this. But it doesn't mean a particular property you buy will double in 7-10 years. It could, of course, and many properties did double (and more) during the recent boom. But I don't think anybody is expecting that to happen again any time soon - I have a sneaking suspicion that my PPOR that I bought for $1m in 02 is not going to be worth $2m next year.
Scott
gees Scott that's underperformance! the one I bought in 02 for $650k is now worth $2m. can't really think fo a property that i have that hasn't at least doubled in that time.
I once read that the UK is the only country in the world that have 900+ years of records of land price. By memory the average growth was something like 10.2 pa. I guess that a lot of thing had happened in almost a millenium War, boom, bust, pandemics, you name it and still people need a place to live. Will that ever change?
You never have to repair rising damp on your BHP shares.
If land prices were $1 900 years ago, and doubled every 10 years, the cost of land would be.
If land prices were ($1), 900 years ago, and doubled every 10 years, the cost of land would be.
1497293092594469000000000000.00. Yep All those zeros are dollars.
If at 10.2%
91925301760630160000000000000000000000.00
Clearly that is not correct.
House prices have only doubled every 7-10 years for the last 30-40 years. During the period until the early 90's, there was high inflation, and they didn't double in "real terms". It's only been in the last 15 or so years, where house prices have massively increased in a low inflation environment have house prices increased in real terms, The main reason was ease of credit.
It happened worldwide, and it's unravelling as we speak.
See if first home buyers can pay 5.6 million dollars for a FHB house(todays 350,000) house in 40 years, when their wage is only 200-300 thousand.
Many people don’t understand compound interest, and the exponential function.
I keep hearing that property doubles every 7 to 10 years....
You never have to repair rising damp on your BHP shares.
That just as the stock market is no longer trading on fundamentals, property can act the same.
I keep hearing that property doubles every 7 to 10 years however have not been able to get my head around it. It doesn't add up for me, especially if wages don't keep pace.
Does anyone have a history of house prices for capital cities for the last 100 years?
Thanks