Property prices falling?!?!?!?

[essence]

I am not surprised when this kind of statement comes from illeterate journos brainwashed by "economists" who have vested interest in share market dreading investors exodus to property market, but PLEASE - ON PROPERTY INVESTMENT FORUM?

Read somewher what "median price" is. Then answer yourself following questions:

1. When property market revives, do buyers snap most expensive properties first or do they seek bargains?

2. What happens to median price when bargains are snapped?

3. When share market crashes, is there any demand for property in the highest price bracket?

4. What happens to the median price when high priced property does not sell?

PEOPLE!!!!! WAKE UP!!!!

Median price drop - this is exactly what happens at the start of each and every property boom.

Yeah, yeah - I know - I am not talking about WA and QLD - there will be a while until all distortion of resource bubble will be absorbed.

 

[buzzlightyear]

Essence, what you are on about? But would like to know what you are on.

Is head still spinning from the RBA rate reduction today?

 

[sparky23]

Mine is and I think what I'm on is a natural high right now!

 

[essence]

Essence, what you are on about? But would like to know what you are on.

Is head still spinning from the RBA rate reduction today?

Are you dizzy because your doom/gloom theories have less and less substance?

As to RBA - if they had any brains they would have reduced rates by AT LEAST 1.5%. For that .5% they failed to reduce today and 0.75% they have failed to reduce in January they are going to pay dearly. If earlier I thought that rates will be 0 by the end of the year, now it looks more like September.

One more thing - agents report that number of inspections and offers submitted in Sydney increased 4-5 fold (for properties under $600K - anything dearer does not exist for me).

 

[Hoffy]

Are you dizzy because your doom/gloom theories have less and less substance?

As to RBA - if they had any brains they would have reduced rates by AT LEAST 1.5%. For that .5% they failed to reduce today and 0.75% they have failed to reduce in January they are going to pay dearly. If earlier I thought that rates will be 0 by the end of the year, now it looks more like September.

One more thing - agents report that number of inspections and offers submitted in Sydney increased 4-5 fold (for properties under $600K - anything dearer does not exist for me).

So you are predicting official cash rates of 0% this year? That's even quicker than Steven Keen thinks!

But then you thought unemployment peaked before Xmas, yet the government is now predicting 7% unemployment.

 

[sash]

I think you are saying that the median price is affect because in a recession the lower end does well thus pulling down the median price. This is the first sign of the bottom of the market. If this is the case I agree!!

I agree about WA being a disaster and Qld (well most of it except Brissie). I expect to hear some "yelping" from some of our WA friends.

I
Read somewher what "median price" is. Then answer yourself following questions:

1. When property market revives, do buyers snap most expensive properties first or do they seek bargains?

2. What happens to median price when bargains are snapped?

3. When share market crashes, is there any demand for property in the highest price bracket?

4. What happens to the median price when high priced property does not sell?

PEOPLE!!!!! WAKE UP!!!!

Median price drop - this is exactly what happens at the start of each and every property boom.

Yeah, yeah - I know - I am not talking about WA and QLD - there will be a while until all distortion of resource bubble will be absorbed.

 

[yorke]

So you are predicting official cash rates of 0% this year? That's even quicker than Steven Keen thinks!

But then you thought unemployment peaked before Xmas, yet the government is now predicting 7% unemployment.

Probably because the increase in immigration numbers, http://business.smh.com.au/business/record-number-of-poms-moving-to-australia-20090203-7vzb.html which should also push up demand for houses and rentals.
Wasn't about 7% unemployment what we had during the last property boom ?
Who cares when the bottom of the rates cycle is, they've dropped the rates today and they'll probably do so again next month and the month after. Its good news for existing home owners and property investors. Aren't you excited ?

 

[Hoffy]

Probably because the increase in immigration numbers, http://business.smh.com.au/business/record-number-of-poms-moving-to-australia-20090203-7vzb.html which should also push up demand for houses and rentals.
Wasn't about 7% unemployment what we had during the last property boom ?
Who cares when the bottom of the rates cycle is, they've dropped the rates today and they'll probably do so again next month and the month after. Its good news for existing home owners and property investors. Aren't you excited ?

I'm happy that my repayments will be cheaper. But high unemployment and recession doesn't excite me in the context of the property market.

 

[essence]

So you are predicting official cash rates of 0% this year? That's even quicker than Steven Keen thinks!

But then you thought unemployment peaked before Xmas, yet the government is now predicting 7% unemployment.

Please do not confuse Gift of God with a meat pie.

I said that 0.1% increase in unemployment before Christmas - favourite time for employers to shed staff effectively killed doomer/gloomer myth about mass layoffs.

Government says 7% by the end of 2010 (unfortunately you have to be able to read to get this). In other words, it is 2.5% increase over 2 years, or 1.25% creep a year. Far cry from doom and gloom. This is more like getting rid of dead wood in companies.

This is not mentioning that when the last boom started in 1996 unemployment rate was 8.7%. When boom got second boost after FHOG unemployment was at 7.5%. I leave it to you to figure out interest rates back then.

And please do not compare me with Steve Keen. He is typical "not have" who is desperate for a company in his own misery. I feel sorry for people he is brainwashing.

 

[essence]

I think you are saying that the median price is affect because in a recession the lower end does well thus pulling down the median price. This is the first sign of the bottom of the market. If this is the case I agree!!

I agree about WA being a disaster and Qld (well most of it except Brissie). I expect to hear some "yelping" from some of our WA friends.

This is fundamental rule of property investment - never buy above median. This is what crowds of smart buyers are doing right now.

Median starts creeping when bargains are snapped by smart people and not so smart move into higher price bracket.

After this boom gets evident to everyone and stampede begins. Herd of silly people with silly money start to buy prestige properties (symptoms of inferiority complex - look at me how great I am).

When people who were predicting housing crash start buying - this is sure sign that market peaked.

 

[Hoffy]

I said that 0.1% increase in unemployment before Christmas - favourite time for employers to shed staff effectively killed doomer/gloomer myth about mass layoffs.

It's just a pity there has been so many mythical layoffs in the 6 weeks since Xmas.

 

[troyhunt]

1. When property market revives, do buyers snap most expensive properties first or do they seek bargains?

2. What happens to median price when bargains are snapped?

3. When share market crashes, is there any demand for property in the highest price bracket?

4. What happens to the median price when high priced property does not sell?

PEOPLE!!!!! WAKE UP!!!!

Median price drop - this is exactly what happens at the start of each and every property boom.

These are very good points and illustrate the importance of relying on median quartile prices where available. There is often a hidden story within the "suburb medians" we usually see.

 

[yorke]

I'm happy that my repayments will be cheaper. But high unemployment and recession doesn't excite me in the context of the property market.

What do you define as high unemployment ? Not that long ago a 7% unemployment rate was considered very low and 6% almost impossible. The predicted recession could turn out to be like the predictions of 12%+ interest rates we had a few months ago or the 40%+ property crash. The truth is that economists only make headlines if they come out with bearish predictions, the more outlandish the prediction the closer to the front page they get.

It's just a pity there has been so many mythical layoffs in the 6 weeks since Xmas.

In percentage terms the numbers are insignificant and a low AUD will more then make up for these losses in coming months. And while we waiting for that to happen, http://www.superlaugh.com/1/behappy.htm

cheers

 

[Hoffy]

What do you define as high unemployment ? Not that long ago a 7% unemployment rate was considered very low and 6% almost impossible. The predicted recession could turn out to be like the predictions of 12%+ interest rates we had a few months ago or the 40%+ property crash. The truth is that economists only make headlines if they come out with bearish predictions, the more outlandish the prediction the closer to the front page they get.


In percentage terms the numbers are insignificant and a low AUD will more then make up for these losses in coming months. And while we waiting for that to happen, http://www.superlaugh.com/1/behappy.htm

cheers

That would be why the government has just plunged us into a $35Bn deficit - because there was no risk of high unemployment or a looming recession?

 

[Chatto]

umm the guy that wrote that song topped himself

 

[warmed_cockles]

Are you dizzy because your doom/gloom theories have less and less substance?

As to RBA - if they had any brains they would have reduced rates by AT LEAST 1.5%. For that .5% they failed to reduce today and 0.75% they have failed to reduce in January they are going to pay dearly.

These two thoughts are incongruous.

 

[warmed_cockles]

umm the guy that wrote that song topped himself

Nah, he didn't.

 

[sash]

Mate...I like the way you think! Outside of the box very refreshing!

I also buy under the median....my target is usually 30% under!

Agree about higher priced property...in some parts of Perth and Sydney they are down 40%!

The stampede is a couple months away as the punters are now more worried about their jobs....employment is the lagging indicator...so the trick is to buy before this gets positive sentiment in the press.

I have a view Comm Prop. tanking...do you concur?

This is fundamental rule of property investment - never buy above median. This is what crowds of smart buyers are doing right now.

Median starts creeping when bargains are snapped by smart people and not so smart move into higher price bracket.

After this boom gets evident to everyone and stampede begins. Herd of silly people with silly money start to buy prestige properties (symptoms of inferiority complex - look at me how great I am).

When people who were predicting housing crash start buying - this is sure sign that market peaked.

 

[yorke]

That would be why the government has just plunged us into a $35Bn deficit - because there was no risk of high unemployment or a looming recession?

They spent to make sure it wouldn't happen. And about that looming recession, most economists haven't noticed but its been with us for the last few months and by the time they do it will be all over.

 

[Hoffy]

They spent to make sure it wouldn't happen. And about that looming recession, most economists haven't noticed but its been with us for the last few months and by the time they do it will be all over.

They blew $10bn before Xmas to make sure it wouldn't happen too. You have a high level of confidence in the govt. to manage this situation.