Michael Yardney's 2009 Predictions

[Mindmaster]

Pulled a 2009 copy of Michael Yardney's "How to grow a Multi-million dollar property portfolio - in your spare time" off the shelf last night for a reread and found his predictions made that year very interesting.

In 2009 he predicted that a property boom was about to start that "...only occures 3 or 4 times in your adult life." and that "...the next property cycle promises to be the biggest property boom in Australia's history."

3 years later in 2012 no such cycle has occured and in general there has been a drop in property prices.

If you bought expensive negatively geared inner city properties in 2009 with the plan to ride the boom, you'd be in a very painful position now.

I'm not knocking Michael, just reflecting on the benefits of hindsight and the risks associated with certain strategies that are heavily reliant on CG.

 

[Rolf Latham]

3 years later in 2012 no such cycle has occured and in general there has been a drop in property prices.

3 years is a very short time for a cycle that normally runs 7 to 15 years ............hence the note of 3 to 4 cycles per lifetime.

Just working with a new client who has 9 years of working life left, and covering off that the smaller the time period you have available to hold any growth investment, the greater the risk.

Id guess at 15 years the risk is small, and at 25 its done and dusted, but 3.........

ta
rolf

 

[matto_]

did yardney claim the boom would have started or been and done in the three years.

Again benefit of hindsight, in five years you may look back on mid 2012 and think if only I had listened to my re reading of those predictions.

 

[devank]

'Mother of all booms' echoes in my ears every time I hear his name

 

[Graemsay]

Making a call that property was about to boom at a time when the credit markets were freezing, and markets in other, comparable countries were collapsing strikes me as either brave or foolish.

Possible reasons for this claim could be:

• Governments pumped liquidity into the financial system, which leads to asset price inflation...
• ... Or general inflation, which would have deflated debts.
• Property prices would have slumped to being cheap by historical standards, presenting a rare buying opportunity.
• Yardney had a book to sell.

The second point has been made as a reason to buy in the US, particularly as it's possible to get a 25 year fix at a record low rate. But inflation hasn't manifested itself to the extent that some were predicting.

I'd like to know what Yardney's arguments were. I suspect that the fourth point comes into it somewhere.

 

[kum yin lau]

Hi, he was right about Melbourne in the time period mentioned.

KY

 

[Piston Broke]

And father of BS. He has no clue what he's talking about other than marketing his services.
But he won't come here and argue his "arguments" because they have no base in reality.

 

[sash]

He there to make money.....so do your own due diligence.

Buying expensive negatively geared properties is silly!

Pulled a 2009 copy of Michael Yardney's "How to grow a Multi-million dollar property portfolio - in your spare time" off the shelf last night for a reread and found his predictions made that year very interesting.

In 2009 he predicted that a property boom was about to start that "...only occures 3 or 4 times in your adult life." and that "...the next property cycle promises to be the biggest property boom in Australia's history."

3 years later in 2012 no such cycle has occured and in general there has been a drop in property prices.

If you bought expensive negatively geared inner city properties in 2009 with the plan to ride the boom, you'd be in a very painful position now.

I'm not knocking Michael, just reflecting on the benefits of hindsight and the risks associated with certain strategies that are heavily reliant on CG.

 

[natedog]

I thought the book was published in 2006?

Like KY says, Melbourne had a mini boom since then....still not the mother of all booms.....might need a few more years for that to occurr,

Nathan

 

[Fifth]

His schtick is blue chip speculative property. Saying, 'the next boom might come tomorrow or it might not happen for another 15 years, but in the meantime consider unglamorous cf+ properties' doesn't fit in with his strategy.

He's selling books so of course his predictions will nicely compliment his chosen strategy.

 

[Player]

Hi, he was right about Melbourne in the time period mentioned.

KY

Hi KY,

He was correct only for a third of the time period mentioned.

Melbourne was white hot in 2009 and early 2010. The rodeo then finished. It doesn't take Einstein to forecast a bull market when Melbourne prices were going insane.

It won't be yipee kayay in Melbourne for a while yet...........not for those utilising the BHP (Buy Hope Pray) strategy. Unless folks are manufacturing growth with reno's or subdivisions and the like, (most of) Melbourne has softened and will be sideways for a while IMHO.

 

[ok180]

And father of BS.

LOL

Property guru got it wrong? Shock! Horror.

Seriously, the guy "sells" services. There is no advantage to him what so ever to predict anything other than a boom.

 

[buster]

His schtick is blue chip speculative property. Saying, 'the next boom might come tomorrow or it might not happen for another 15 years, but in the meantime consider unglamorous cf+ properties' doesn't fit in with his strategy.

He's selling books so of course his predictions will nicely compliment his chosen strategy.

He is pumping up prices in areas where he owns property, as he relies on ever increasing prices to compensate for his poor yeilds and high holding costs, by creating demand and encouraging others to overpay and gets a commision as a bonus. Without this his stack of cards will fall down. The books are a tool to create this demand, what he makes from them would be insignificant compared to what he can make from increasing the value of his property portfolio.

 

[Fifth]

He is pumping up prices in areas where he owns property, as he relies on ever increasing prices to compensate for his poor yeilds and high holding costs, by creating demand and encouraging others to overpay and gets a commision as a bonus. Without this his stack of cards will fall down. The books are a tool to create this demand, what he makes from them would be insignificant compared to what he can make from increasing the value of his property portfolio.

Great post. You're right, the books are just a cog in the machine. Between all of his interests, is there *any* reason to trust the guy?

 

[Rolf Latham]

It won't be yipee kayay in Melbourne for a while yet.

True, much more like Kumbah Yah ( sic)

ta
rolf

 

[Ausprop]

given where this topic of discussion has evolved to previously on this forum we should just lock this thread and move on, it is too divisive

 

[Piston Broke]

given where this topic of discussion has evolved to previously on this forum we should just lock this thread and move on, it is too divisive

Get out of the kitchen if it's too hot and you can't handle it.

 

[HiEquity]

given where this topic of discussion has evolved to previously on this forum we should just lock this thread and move on, it is too divisive

Seconded. I don't believe the owners of this forum want to be dragged down into legal threats again... and I can't see any other way for this thread to end.

 

[Fifth]

So we shouldn't discuss one of Australia's premier property gurus on an Australian property investment forum for fear of the topic touching upon some personal matters... righteo.

 

[Aaron_C]

Yardney and any other person should be able to take criticism, good and bad. They are just opinions, after all.