Property bubble ready to pop

[starter]

Western Sydney really need a correction. Lets wait and see when RBA hikes interest rate one or two times.

While Western Sydney prices got a very decent hike last year, the numbers aren't actually that bad with 6%+ yield still not that hard to achieve. A 50 bips rate rise shouldn't affect investors too much.

Also if you go on the last peak and when it occured then there should still be some room to go.

 

[devank]

Western Sydney really need a correction. Lets wait and see when RBA hikes interest rate one or two times.

I doubt it unless people start losing their jobs.

 

[impala67]

Sydney - The new normal ?!

Western Sydney really need a correction. Lets wait and see when RBA hikes interest rate one or two times.

Sydney prices seemed unsustainable, however when looking at figures from well known residential data providers - SQM Research it looks to be a supply and demand sort of thing?

National Stock On Market
Houses December 2013-current
Sydney 13,168
Melbourne 31,210
Perth 15,028

...it seems the current Western Sydney Prices may be the new normal?!
Do Sydney people have any comments. The house prices seem to make more sense when looking at the above, as Sydney-siders are priced out of other suburbs?!

 

[MTR]

http://media.smh.com.au/featured/property-bubble-ready-to-pop-5151999.html

Sometimes it is good to hear the other side of the coin. The thing I can gather from this is :
1) Buy below median price
2) Buy in states with lower median price (SA/ Brisbane)
3) Save some cash to buy in bubble prone state (sydney/melbourne/perth) when needed.

Should be able to profit irregardless of whether the crash comes if we do this?

As you can see, I'm still incline to invest in property after watching the video.

You buy when the market is rising, forget the median and the other stuff, so you buy in a market which is low in stock and plenty of demand, its simple, supply vs demand, this will dictate how the market will go.
If you are following a particular market, apply this rule

 

[punterncollect]

outside the square

I hear a lot of talk here & in the media about property in all the cap. cities as if there is no property to invest in anywhere else; where I live on mid north coast NSW the prices have not moved for 7 years so it is well overdue take note all you bargain hunters & mark my words it will go up as we always lag Sydney by 1-2 yrs on both rises & falls; so now is the time to snap up the IP with solid tenant & returns as the infrastructure machine rolls into town (highway & airport upgrades, universities opening full campuses & public hospital ($75M alone) improvements

 

[devank]

The house prices seem to make more sense when looking at the above, as Sydney-siders are priced out of other suburbs?!

Auburn median price for Units is $346,000
Granville median price for houses is $489,000

Both are sitting between two CBDs (Sydney & Parra). I wouldn't call that priced out.
What can you do if everyone wants to have a water view or big mansion ?

 

[impala67]

Auburn median price for Units is $346,000
Granville median price for houses is $489,000

Both are sitting between two CBDs (Sydney & Parra). I wouldn't call that priced out.
What can you do if everyone wants to have a water view or big mansion ?

Same thing down here in Melb...

 

[mrdobalina]

I live on mid north coast NSW the prices have not moved for 7 years

What town is this punterncollect?

 

[mrdobalina]

so you buy in a market which is low in stock and plenty of demand, its simple, supply vs demand, this will dictate how the market will go.
If you are following a particular market, apply this rule

This suggests that you buy in a sellers market. A contrarian investor would take the opposite approach...

 

[Ausprop]

This suggests that you buy in a sellers market. A contrarian investor would take the opposite approach...

the dilemma, catch a falling knife or the trend is your friend

 

[DaveM]

Western Sydney really need a correction. Lets wait and see when RBA hikes interest rate one or two times.

Care to elaborate on why western sydney in particular needs a correction?

 

[punterncollect]

What town is this punterncollect?

Port Macquarie

 

[bez23]

Port Macquarie

This post is related to affordability. If port Macquarie median price is much lower than sydney (< 200k) or higher median wage , it will have room to grow.

WHO recommendation for housing affordability is less than 5? gross income.

Good discussion though, keep the posts coming

 

[impala67]

Agree, regionals have plenty of room to move. With Sydney booming, one would think the NSW central coast and northern towns would have to pick up also. However, there are still many suburbs under the median in Sydney. I was reading yesterday (SQM Research figures) that Sydney's stock is the lowest since 2008 ! Looks like another strong year for them.

 

[bez23]

You buy when the market is rising, forget the median and the other stuff, so you buy in a market which is low in stock and plenty of demand, its simple, supply vs demand, this will dictate how the market will go.
If you are following a particular market, apply this rule

Supply and demand is good. But supply and demand + affordability based on the local area is better

 

[keithj]

A Look At Harry Dent's Track Record

...I continue with a review of Dent's track record. As you will see, similar to the other so-called experts promoted by the media, Dent's expertise lies more in marketing than in market forecasting.

 

[willair]

Mr-Dent has been around a long time,the one item he will play on this time is un-employment and focus on what is not said because the amount of Australian companies that are going belly-up all this year and next and transfer their business model overseas ,,so if you focus on analysing someone like Mr-Dent look at him not the message..

 

[bez23]

Nice find keithj. I agree with you but the reason I started this thread is not to promote dent or doom and gloom buy to see what other ss'ers are doing to manage the risk.

 

[mrdobalina]

Nice find keithj. I agree with you but the reason I started this thread is not to promote dent or doom and gloom buy to see what other ss'ers are doing to manage the risk.

I had a conversation with a colleague in 2004 about Dent's peak spending demographic theory. At that time, my friend thought, better put some risk management measures in place before 2007/08. A couple of years passed, he made some big investments in commercial and residential property. When the GFC hit, he got hammered a couple of mil. Now he is cautious to sit on the sidelines and see how it pans out in the next few years...

 

[MTR]

Moods change. If the mood changed to doom and gloom and economic ruin, I think those local and international cashed-up investors would decide to wait and see. It was only a few years ago Sydney was in the doldrums and had been for some years.

On the other hand, I have been trying to remember the last time mainstream housing prices "bubble burst" in Australian capital cities. There have been slow downs for a few years, but not catastrophic "bursts" that I am aware of.

Gold Coast 40 % drops, only just starting to recover.
Mandurah 40% drops, only just starting to recover after 6 years.