I've been saying this for quite some time, and as recently as:
http://www.somersoft.com/forums/showpost.php?p=771989&postcount=21
Steve Keen's apartment +25% since he sold
- Thread starter Andrew_A
- Start date
I've been saying this for quite some time, and as recently as:
http://www.somersoft.com/forums/showpost.php?p=771989&postcount=21
Could even be 20 years right ?
Has anyone got a graph/stat/anecdotal experience to show a 40% drop in property in Aus ever over a 20 year window?
Please post it below.
Ta.
keen and other doomsday Prophets and their cult members follow a similar pattern. (see below)-sound familiar?
"Those who don’t believe won’t be surprised if nothing happens, but what happens to believers when the promised Armageddon doesn’t materialize?
Psychologist Leon Festinger examined this in the book "When Prophecy Fails," and found that in some cases the fact that the prophet was wrong has little effect. To understand why, it’s important to realize that the high-profile prophecy that captures the public’s attention is only a small part of that group’s belief system. Anyone can make a mistake, and one mistake or misstatement by a religious authority doesn’t necessarily undermine belief in other religious precepts or prophecies. Religious texts are notoriously open to widely varied interpretation, and faith in a leader’s credibility does not necessarily hinge upon one prediction (even if it’s a big one).
Often the prophet will insist that the general prediction was correct, and that the End Times are imminent, but that the specific day or year was off, and move the day forward.
In fact, Camping has already done that once; he previously claimed that the world would end in September 1994. "
B Radford - Discovery News
Naaah; don't you know; ya just got lucky!
Seriously; key phrase being; "acting on that opoortunity."
See, to me; the whole idea is the create/find the opportunity and to act.
What's the opportunity?
Hearing everyone saying don't buy and then buying anyway?
How many of us have heard acquaintances/colleagues/family/friends say stuff like "Oh; when the kids finish school...", or "When the interest rates go down a bit...", or "When the prices drop a bit...", or "I can't believe you aare buying there.."
And so on.
At the risk of being a greedy, rude bugger, I'm more interested in the performance of my own invested assets, as opposed to something that was once owned by a guy I've never met and don't care about.
They add another 2 years? Ha!
Now altogether . . . "Then I saw her face. Now I'm a believer, not a trace of doubt . . . in my mind."
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Not by any of the Residex Cap City Trading Indices listed here
http://www.residex.com.au/index.php..._indices_median_table&thestate=VIC&dwelling=H
Does Residex have a prime property index?
Admittedly, Residex say Sydney, Perth, and Brisbane are at the bottom of their cycle, but no clarfication of how long the cycle is this time.
hmmm... RPData have the following for Surry Hills, NSW, from May 2010 to Apr 2011:
Median House Price : -1.24%
Median Unit Price : -4.18%
just gotta purchase the Surry Hills Burb report or ask a broker for it
has the data...........
Got some verifiable first line data ( for us anyway) have a sales contract settling for a client on a property in Chippendale which is 12 % higher than the best expectation they had last year.
ta
rolf
has the data...........
Got some verifiable first line data ( for us anyway) have a sales contract settling for a client on a property in Chippendale which is 12 % higher than the best expectation they had last year.
ta
rolf
Falls in real house prices are not as rare as many people think.
The falls can happen over the better part of a decade, and are not necessarily a short sharp drop with a rapid rebound.
Refer to http://www.econ.mq.edu.au/research/2004/Abelson_9_04.pdf
Some examples from Table 2:
Real house prices in Melbourne fell by 21% between 1974 and 1982
Sydney had a 17% real drop between 1981 and 1985.
Perth's fall was 26% between 1970 and 1987 (although there was another boom and trough in between).
One difference now is that in those years inflation was around 10% or so, meaning that house prices could rise by (say) 5% but that was still a relative drop as everything else (including wages) rose faster.
Today, if houses grew by 5% less than inflation, that would mean some absolute drops. This would spook some and lower confidence, especially those whose strategies are based on high capital growth rates (eg agressive -ve gearing). Whereas those whose strategies will succeed with either zero or CPI-only growth rates will still do OK.
Those who buy what I call 'commodity houses' (ie a. affordable eg <$300k b. on good blocks in established areas c. below replacement value d. some improvement potential & e. yield >5%) in 2011 should succeed longer term provided they can meet the shortfall in the interim.
There will be difficulties for first homebuyers in these areas, but their place will be filled by others who perhaps can't afford $400k - well located affordable housing should always be in demand. The immediate prognosis for dearer areas (a $600k - $1m house is not a necessity but a luxury IMHO) may not be so promising however.
The falls can happen over the better part of a decade, and are not necessarily a short sharp drop with a rapid rebound.
Refer to http://www.econ.mq.edu.au/research/2004/Abelson_9_04.pdf
Some examples from Table 2:
Real house prices in Melbourne fell by 21% between 1974 and 1982
Sydney had a 17% real drop between 1981 and 1985.
Perth's fall was 26% between 1970 and 1987 (although there was another boom and trough in between).
One difference now is that in those years inflation was around 10% or so, meaning that house prices could rise by (say) 5% but that was still a relative drop as everything else (including wages) rose faster.
Today, if houses grew by 5% less than inflation, that would mean some absolute drops. This would spook some and lower confidence, especially those whose strategies are based on high capital growth rates (eg agressive -ve gearing). Whereas those whose strategies will succeed with either zero or CPI-only growth rates will still do OK.
Those who buy what I call 'commodity houses' (ie a. affordable eg <$300k b. on good blocks in established areas c. below replacement value d. some improvement potential & e. yield >5%) in 2011 should succeed longer term provided they can meet the shortfall in the interim.
There will be difficulties for first homebuyers in these areas, but their place will be filled by others who perhaps can't afford $400k - well located affordable housing should always be in demand. The immediate prognosis for dearer areas (a $600k - $1m house is not a necessity but a luxury IMHO) may not be so promising however.
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sorry evand but your demigod is still a muppet... nice to see how quick you come out running at any sign of some actual fact supporting Steve Keen.. unfortunately StefanA is wrong, dont know how he came to those figures so I have attached the screen shot to remove any doubt...
awwwww better luck next time evand im sure one day you will be right but for now you continue to be dead wrong and so is Keen.
awwwww better luck next time evand im sure one day you will be right but for now you continue to be dead wrong and so is Keen.
Thats just a touch less than 25% since he sold it.
Attachments
there's a Surry Hills link to the data above....divide the apr11 median by the may10 median, then subtract 1. ....or just check the rpdata charts of monthly medians at the link.
the figures you provide for Surry Hills show the median unit value for Apr11 is 491250 and May10 is 544000.... -9.7% growth.
Unless you can show a similar unit in the same block being sold more recently, I'm afraid looking at medians tells you nothing, infact worse than nothing, it is misleading.
The median price of units going up just tells you that a more expensive sector is being sold.
The median price of units going up just tells you that a more expensive sector is being sold.
StefanA you cannot simly select a particular month in the year that suits your view. As you can see median price jumps up and down between months given the number of sales for that month can have a large impact on the median. Its just just as easy to pick a month that shows a rise.
Why not pick the month of July 2010 as a starting point or why not pick the month of March 2011 as an ending point?? If you have March 2011 as the starting it shows a massive crash. However this is just perverting the stats.
Therefore what is normal practice is year to date and compared to the median price of the year before. If you report the median as everyone else does its a rise not a fall.
Why not pick the month of July 2010 as a starting point or why not pick the month of March 2011 as an ending point?? If you have March 2011 as the starting it shows a massive crash. However this is just perverting the stats.
Therefore what is normal practice is year to date and compared to the median price of the year before. If you report the median as everyone else does its a rise not a fall.
In order for this flawed logic to work all low prices, median priced properties would have not NOT sell at all. If they sell for lower prices it will bring down the median price. Median price is not an average.
It also assumes the type of dwelling being sold in Surry Hills changed dramatically from the point in time Keen sold. That is the day after only very expensive properties sold. Very unlikely.
No stat is ever perfect but to dismiss it completely as you just have is wrong. I will look at median price changes everytime before I go off "the vibe" which seems you prefer as an indicator of what a particular suburb is doing.
It also assumes the type of dwelling being sold in Surry Hills changed dramatically from the point in time Keen sold. That is the day after only very expensive properties sold. Very unlikely.
No stat is ever perfect but to dismiss it completely as you just have is wrong. I will look at median price changes everytime before I go off "the vibe" which seems you prefer as an indicator of what a particular suburb is doing.
Chalmers St, Surrey hills? anyone know what block, then look at 'on the house',
would still really need to know the condition, new kitchen etc.
Otherwise it's just speculation after all, and as mentioned before, he could have pretty much kept pace with his money on term deposit.
would still really need to know the condition, new kitchen etc.
Otherwise it's just speculation after all, and as mentioned before, he could have pretty much kept pace with his money on term deposit.
There's a lot to be said for Chalmers St, it's an arterial road into the city within spitting distance of the Redfern Block. Try taking a look at Bourke St or Richards Ave prices. They might just blow your socks off.
Interesting argument about "median". The whole "property doubles every 7 years" is based on median.
I have mentioned this many times but as there are always new members I'll retell the story: I bought my first house in '68. I had never heard the term but it was probably above median. I still own it today and if I hadn't spent money out of my pocket on refurbishing and repairs it would be a "doer-upperer" @ abt 50% of today's median. Well maintained it would STILL not be median.
20 years ago there were some cheep chit units in town but NOBODY lived in them. (OK nurses and apprentices) In the last 5-10 years there have been thousands come on stream with half a mil entry price. Every slum-lord with those crappy old units could only dream of getting "median" price, but it shows in the statistics. Currently there is heavy oversupply (flyin/flyout miners only need so many) and the median is plummeting again.
I never have to put a new roof on my BHP shares.
I have mentioned this many times but as there are always new members I'll retell the story: I bought my first house in '68. I had never heard the term but it was probably above median. I still own it today and if I hadn't spent money out of my pocket on refurbishing and repairs it would be a "doer-upperer" @ abt 50% of today's median. Well maintained it would STILL not be median.
20 years ago there were some cheep chit units in town but NOBODY
lived in them. (OK nurses and apprentices) In the last 5-10 years there have been thousands come on stream with half a mil entry price. Every slum-lord with those crappy old units could only dream of getting "median" price, but it shows in the statistics. Currently there is heavy oversupply (flyin/flyout miners only need so many) and the median is plummeting again. I never have to put a new roof on my BHP shares.
