Sydney Silliness Warnings 2015

[charlieandkath]

Is Sydney now starting to get too hot? Could it get hotter and then hotter again? With the experience of the investors on this forum I would like to hear of the warning signs of getting close to or past the peak and if they are starting to appear. I personally believe we have another 35% growth this cycle.

Warning signs such as are people starting to buy property and then put back on the market straight away. Sydney cabbies telling you to buy property. What were some other signs from 2003/2004? I remember everyone was watching the property auction show on TV with Michael Caton. Because I don't live in Sydney there is no guage of any of the above for me at the moment.

What are your thoughts?

 

[charlieandkath]

To add to above we are seriously thinking of buying once more in Sydney. This would be a very short term trade while the hype is on. For example - buy a unit in eastern suburbs for say 600,000, spend 50,000 on kitchen and bathroom renovation and then put back on market in one year for 850,000 plus. Make sure sell when the market goes that 10% over where it should. Hard to tell I know but is it worth a crack?

 

[D.T.]

I personally believe we have another 35% growth this cycle.

There's been about 35% so far this cycle and you're suggesting it can go for double that?

 

[Phar Lap]

Would be interesting to see what the "Sydney" median was 7-10 years ago compared to today.

Im sure some data hounds here can furnish an answer.

 

[Biz]

Is Sydney now starting to get too hot?

To add to above we are seriously thinking of buying once more in Sydney. This would be a very short term trade while the hype is on. For example - buy a unit in eastern suburbs for say 600,000, spend 50,000 on kitchen and bathroom renovation and then put back on market in one year for 850,000 plus. Make sure sell when the market goes that 10% over where it should. Hard to tell I know but is it worth a crack?

You just answered your own question.

 

[Phar Lap]

I can think of better ways for such short term gain without as much transactional liability.
Do I think it's nearly finished, You bet.

 

[Ace in the Hole]

I can think of better ways for such short term gain without as much transactional liability.

Please share.

 

[sanj]

There's been about 35% so far this cycle and you're suggesting it can go for double that?

I don't see it happening personally and if it does I think the pullback will be significant. median prices over $1.25 m would be terrible for the city

 

[Phar Lap]

Please share.

Depending upon the time value.(obviously I'm thinking very short term)

Why wouldnt you wack it all down on blue chip share ?

The risk of getting caught in the Syd market with the scenario the OP posted in their 2nd post is high, IMO. Unless of course they have plenty of LVR to ride out when the musiuc stops, but it was a generic question so hence my answer.

 

[MTR]

Is Sydney now starting to get too hot? Could it get hotter and then hotter again? With the experience of the investors on this forum I would like to hear of the warning signs of getting close to or past the peak and if they are starting to appear. I personally believe we have another 35% growth thi

Warning signs such as are people starting to buy property and then put back on the market straight away. Sydney cabbies telling you to buy property. What were some other signs from 2003/2004? I remember everyone was watching the property auction show on TV with Michael Caton. Because I don't live in Sydney there is no guage of any of the above for me at the moment.

What are your thoughts?

All the above signs of property fever, fear of missing the boat, some buy at peak because they need convincing that it is actually rising then they jump in.... ouch.

Who knows what will happen, that is the problem, we are all just guessing.

However, what do we know?? Syd property market has been rising since late 2012?? at least 2 years. Most cycles/booms go for 18 months - 2 years. Only property boom I saw go for much longer was Perth 2001-2006, however this was very different, the mining boom drove commercial and resi market to dizzy heights. It was a big mother

So, are you feeling lucky??

What's the fall back position if the market tanks in the middle of your reno??

When markets go bust they fall back in price and then the buyers fall away rapidly. Investors who have over committed throw their properties on the market, suddenly there is too much stock, so we have oversupply.... double ouch.....

Can you hold if you have to? Will it hurt, as you may need to hold it for the next property cycle. Have you also considered interest rates - eventually they will rise, more pain. Successful property investing has alot to do with managing debt and mitigating risk, I have seen many investors go backwards, because they get caught up with the notion that property prices will continue to rise, emotion gets in the way of logic unfortunately.


MTR

 

[Phar Lap]

So, are you feeling lucky??

Thats the gist of it.

 

[cadence]

if you have the financial capacity to put a deposit down now, i say do it.

there are too many wealthy people in Australia who will continue to have capacity to buy in Sydney and there are enough foreign purchasers propping up the prices for OTP brand new purchases (which will help drive up the older stock).

 

[Phar Lap]

there are too many wealthy people in Australia who will continue to have capacity to buy in Sydney and there are enough foreign purchasers propping up the prices for OTP brand new purchases (which will help drive up the older stock).

Correct.

The market is the market. Money is trying to find a return.
It will get it where it wants to.

 

[charlieandkath]

Warning signs such as are people starting to buy property and then put back on the market straight away. Sydney cabbies telling you to buy property. What were some other signs from 2003/2004? I remember everyone was watching the property auction show on TV with Michael Caton. Because I don't live in Sydney there is no guage of any of the above for me at the moment.

So none of these warning signs are in Sydney yet? Hmmm - interesting. The herd is yet to act.

 

[Biz]

The herd is yet to act.

Lol ok

NO ICEBERG!

 

[hugh72]

Is the market entering a euphoric state in Sydney yet?

 

[oc1]

Is the market entering a euphoric state in Sydney yet?

Looking at some of the discussion here lately I would say yes.

 

[charlieandkath]

Is the market entering a euphoric state in Sydney yet?

This is what I'm trying to establish and then guage how far along the euphoric state curve are we. If we are just at the start of this curve what can we expect? Will it play out like the 2003/2004 boom? What are the signs? Are there any significant warning signs to watch for? Long term experienced investors - what do you think? Trying to bait see - change for an answer.

 

[WattleIdo]

You just answered your own question.

If you look back at the mini-poll that was done by Richard Feynman a week or two ago, you'll see that there weren't many thinking it would go over another 10%. Keeping in mind that of the 5 or 6 votes for over 25%, 1 was charlie and the other was kath.
It's probably gone up another 5% this weekend! That's in the west. What's the east doing?

 

[charlieandkath]

If you look back at the mini-poll that was done by Richard Feynman a week or two ago, you'll see that there weren't many thinking it would go over another 10%. Keeping in mind that of the 5 or 6 votes for over 25%, 1 was charlie and the other was kath.
It's probably gone up another 5% this weekend! That's in the west. What's the east doing?

We didn't vote twice.

East has been slow off the mark I reckon. Inner west was going nuts for years whilst the east didn't move at all. East definitely been moving for 2 years though.