Is the tide turning on negative press?

T

Tom-B

Maybe it's just me, but I'm noticing a lot less D&G commentary from the media over the past 2-3 weeks. Maybe it's just the Xmas spirit?

Speaking to a few friends and colleagues that are keen investors, they are certainly calling an inflationary adjusted flat or slight tick upwards for 2012 - particularly in areas of lower socio-ec and high migrant %.

Sentiment drives this market, and if unemployment remains steady, rates stay where they are or go lower, and the reduction in press negativity - 2012 could be interesting to watch.

.....Ofcourse Europe could go to hell, and take the financial market, jobs and sentiment with it.

Will be one to watch. I'm staying on the sidelines for now, but have been busy stashing cash for the past 12 months in the event the right opportunity comes along!
 
Must be on holiday!

Depends who you believe. If you believe in the baby boomers/demographic theory of their inevitable reduced spending into retirement and slowed economy, we may yet see some further stagnation or falls.

There could be brief resurgence followed by a greater fall. Population could be key, resources industry could also prop us up if its boom filters through the rest of the economy.

All in all, there's opportunities out there to seize and the next few years could present the best buying opportunities in a long time to come.

Keep the savings account ticking over and pounce in 2013-14.

VP
 
Couple of decades please! Or better yet scare most people away forever so I can buy all the properties!
 
I'm still standing by my prediction of several years of stagnation in many parts of the Australian market. I think we could well be in a similar situation to the 1990s.
 
VYBerlinaV8 said:
I'm still standing by my prediction of several years of stagnation in many parts of the Australian market. I think we could well be in a similar situation to the 1990s.
Click to expand...

This is my (and most of my friends that I've spoken to who have been investing inproperty for a few years) prediction too.

I also see yields improving over that time, albeit slowly.
 
There's an old piece of investing wisdom that says when the last bear turns bull then the market top has been reached... :)

That said, it is possible that the market has made a sharp change. The graph below illustrates recent directions in UK property prices.

Nationwide2.jpg


There weren't the same falls in Oz as there were in the UK during 2008. The turnaround was probably due to interest rates being slashed to 0.5%, and remaining there ever since, and the RBA hasn't done the same.
 
Wether you like it or not, the press play a big role in price growth. So if you're one who said 'stay negative forever' then your equity might just stay the same.. Good luck with your investing then! Investors rely on the masses to drive prices higher.

The masses actually listen to the media, they don't know any better and it's their only way of looking in-to the property market which in-turn drives the masses who in-turn drive the price growth, and deflation in our property market. They commonly buy high, and sell low. The couple ofinvestors who have been buying aren't enogh to drive prices higher. It can't always be good though but I really think we're due for some positive action soon, it's been a long time.
 
I 2009,

You hit the nail on the head there.

The masses drive prices higher. What if the masses are of retirement age and past their peak in spending and driving the economy? Who's going to make up for this difference to keep assets peaking and growing in the biggest asset bubbles in the history of civilization?

Cheers,

VP
 
Never got that argument. There are people born all the time, people dying all the time. People retiring all the time. People receiving property and money from wills all the time. Never understood the 'baby boomer' thing. there are the same amount of people retiring each year, in fact, there are more people retiring each year. They all buy property and all need somewhere to live. People talk about the age segments as if there were people born in one year and no baby's for another 15 years. There were actually more people being born each year and continue to be per year, not per 15 years.
 
No, the point is that because more and more people are retiring, they are no longer working. Since bank lending is predicated on people having income to service a loan, this may imply that housing prices will face drops. That's the assumption anyway.
 
investor2009 said:
Never got that argument. There are people born all the time, people dying all the time. People retiring all the time. People receiving property and money from wills all the time. Never understood the 'baby boomer' thing. there are the same amount of people retiring each year, in fact, there are more people retiring each year. They all buy property and all need somewhere to live. People talk about the age segments as if there were people born in one year and no baby's for another 15 years. There were actually more people being born each year and continue to be per year, not per 15 years.
Click to expand...


Demographics...how do they work?
 
The up and coming generations driving the economy will do the job in replacing the baby boomers. A current belief of certain economists, Dent (US) and Keen (Aus) from studying demographics (too complicated for me to understand) is that there will be a lag of 10-13 years before the economic growth of these up and coming generations will match the decline in production from the baby boomers.

I don't know how this applies to Australia in the property market with factors such as scope for ever increasing migration, a generally better rated banking system and am booming resources sector.

Very simplified, yes. Its' not a bad thing. It's simply cyclical and being aware of such things can prepare you to more efficiently stress-test your investment strategies.

This shoudn't be taken as advice coming from a very inexperienced Property Investor as I am. It's being aware of possible trends to prepare for great buying opportunities that may arise in the next few years.

VP
 
ABS don't lie do they?

http://www.abs.gov.au/ausstats/[email protected]&prodno=3101.0&issue=Jun 2011&num=&view=

-People peak in spending around 46-50 years old.

-Roughly 60% of the Property market is controlled by owners who have one or two properties: a PPOR and roughly 7% OF these have one investment property.

-90% of these baby boomers will retire under the poverty line according to the amount of their super (2006 stats).

-How will they fund their retirement? Downsize PPOR's? If 90% of them have to find retirement income this way, what is going to happen to the value of property values over the next 10-15 years whilst the economy catches up?

Please keep in mind other than the ABS population by age statistics, the other estimations are just that, estimations based on second hand information. I could be way off, so take it or look into it as you see fit.

Chers,

VP
 
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