Some Mum and Dad investors can tolerate sideways movements in property, given the tax benefits of owning an IP.
So you have no problems with Mum/Dad investors gearing up at 20:1 to get into property, but God forbid they use some spare cash to pickup a couple of Gold bars for some protection against the mad policy some central banks are taking?But when people like Hobo Jo come here telling us that gold is what Mums and Dads need to "invest" in (because property is going to crash!) I really get upset.
At a 95% lend property has to only fall 5% for ALL capital to be wiped out. Canberra almost dropped by that in the 3 months to January and Melbourne, Sydney, Brisbane and Perth have all dropped around 2.5% over the 3 months to January (RPData stats). You want to talk about the risks, how about considering the risk that property buyers face today, years of having to make up the difference between the rent and costs shortfall while being exposed to the most overpriced housing market in the world... oh but how could I forget, paying money every week to hold a property means I get a tax benefit yipee!
I don't know where you are getting the idea that I'm pushing Mum & Dad investors into Gold. In all honesty I think Mum & Dad investors with little time of their own to investigate investment options should either leave it in cash or pay someone to invest for them (e.g. a balanced financial planner).
For those that do get into Gold, I would suggest they do so without borrowing... in comparison to the usual way property is bought (e.g. highly leveraged) unleveraged Gold is a relatively safe option (in my opinion, for the short to medium term). It's worth noting that Gold priced in AUD peaked at the same time in 1980 but didn't have as large a fall as priced in USD.
Hobo Jo, I don't mean to offend or insult you.
clueless people, just like Hobo Jo.
I've been here 5 years so far and have no plans to go anywhere. I imagine I'll still be here in another 5 when the property market is looking to have bottomed/is representing fair value again and I'm once again be a buyer...Very kind of you to warn us about the impending crash in property Hobo. Now we know, thanks to you, its time to move on.......