Again, starting new thread - because two previous were about "predictions".
I have made my predictions few months ago, so I am just going to summarise.
http://www.news.com.au/business/money/story/0,28323,24896398-14327,00.html
http://www.homepriceguide.com.au/saturday_auction_results/sydney.pdf
http://www.news.com.au/business/story/0,27753,24897459-462,00.html
What these three links have in common?
Ok, the only useful info in the first one - nearly 70% of Australian public expects property boom.
Second - auction clearance rate in Sydney hit 71%. It is at a boom level.
Third - sucker's rally on the sharemarket comes to an end.
Funny thing about public perception is that if public thinks that there is GOING TO BE a property boom - it means boom is already here.
There is a simple reason why I write to this forum - I ran out of cash buying 21 properties between October and now. I monitor railway corridors in a triangle Penrith-Wyong-Wollongong and now I would like to share some observations with you.
There is nothing overly creative in what I do - buy solid rundown property, give 3-4 days makeover, rent it out, then go to bank and mortgage itfor the full purchase price.
Three months ago I was aiming for 8% post-makeover return. Two months ago - for 7%. Last month I was forced to settle for 6%.
Spoke to dozens of agents - all state the same - many willing buyers, vendors reluctant to list and reluctant to negotiate.
Agents' behaviour dramatically changed over the last few weeks. There is full set of the symptoms of "boom syndrome":
- Half of the agents have their phones on voice mail and do not bother return calls, emails, etc
- Agents refuse submit offers to vendors
- Agents talk you out of particular properties (Want it for themselves?)
- You get gazumped (practice not seen for a long while)
- Many listings in windows or Internet are bogus (Oh, we did not have a time to remove it - was sold three weeks ago)
What I have seen the last week - I never seen before.
- Two agents faled to show up for an appointment.
- One agent did not bother to come to an advertised open house. 11 people tried to ring her out of her cosy hole to no avail.
But the most amazing - I have seen 20 people strong investment club looking for properties. If such lousy people who form investment clubs are out for property - what else would I say?
Few months ago some people on this forum were spitting at me fo rpredicting the property boom.
I have a news for you. There are still properties at the same price range that I have bought mine, but with substantial difference. If average reno spend on those I bought was $3-5K, the ones that left require $70-80K spend to make them livable.
In other words, I have got 21 property that did not cost me a cent to own and never will be. And you did not.
And in unlikely event you wake up right now, you will be about
$1.5 MMMMIIIIILLLIIIOOONNNNN dollars worse off.
Almost forgot - please do not bugger me with what happens in WA, QLD or in Sydneys "effluent" suburbs. They are not driven by normal market forces but resource bubble. Unfortunately these areas will have to go down before they go up.
I have made my predictions few months ago, so I am just going to summarise.
http://www.news.com.au/business/money/story/0,28323,24896398-14327,00.html
http://www.homepriceguide.com.au/saturday_auction_results/sydney.pdf
http://www.news.com.au/business/story/0,27753,24897459-462,00.html
What these three links have in common?
Ok, the only useful info in the first one - nearly 70% of Australian public expects property boom.
Second - auction clearance rate in Sydney hit 71%. It is at a boom level.
Third - sucker's rally on the sharemarket comes to an end.
Funny thing about public perception is that if public thinks that there is GOING TO BE a property boom - it means boom is already here.
There is a simple reason why I write to this forum - I ran out of cash buying 21 properties between October and now. I monitor railway corridors in a triangle Penrith-Wyong-Wollongong and now I would like to share some observations with you.
There is nothing overly creative in what I do - buy solid rundown property, give 3-4 days makeover, rent it out, then go to bank and mortgage itfor the full purchase price.
Three months ago I was aiming for 8% post-makeover return. Two months ago - for 7%. Last month I was forced to settle for 6%.
Spoke to dozens of agents - all state the same - many willing buyers, vendors reluctant to list and reluctant to negotiate.
Agents' behaviour dramatically changed over the last few weeks. There is full set of the symptoms of "boom syndrome":
- Half of the agents have their phones on voice mail and do not bother return calls, emails, etc
- Agents refuse submit offers to vendors
- Agents talk you out of particular properties (Want it for themselves?)
- You get gazumped (practice not seen for a long while)
- Many listings in windows or Internet are bogus (Oh, we did not have a time to remove it - was sold three weeks ago)
What I have seen the last week - I never seen before.
- Two agents faled to show up for an appointment.
- One agent did not bother to come to an advertised open house. 11 people tried to ring her out of her cosy hole to no avail.
But the most amazing - I have seen 20 people strong investment club looking for properties. If such lousy people who form investment clubs are out for property - what else would I say?
Few months ago some people on this forum were spitting at me fo rpredicting the property boom.
I have a news for you. There are still properties at the same price range that I have bought mine, but with substantial difference. If average reno spend on those I bought was $3-5K, the ones that left require $70-80K spend to make them livable.
In other words, I have got 21 property that did not cost me a cent to own and never will be. And you did not.
And in unlikely event you wake up right now, you will be about
$1.5 MMMMIIIIILLLIIIOOONNNNN dollars worse off.
Almost forgot - please do not bugger me with what happens in WA, QLD or in Sydneys "effluent" suburbs. They are not driven by normal market forces but resource bubble. Unfortunately these areas will have to go down before they go up.