We will defy history if the bubble doesn't burst

[devo76]

for the record i dont think they will be higher by 2020 we may even have a new currency by then ..

i posted on many threads here now and said what was going to happen how am i doing so far ..

this might sound like blowing my trumpet . you think but before anyone comments please follow where i have posted and check it out ..

gold now $1500 aussie an ounce

stocks down since i posted first about trend

lending freezing up as i said

housing is going south .

spending plummeting

the piigs would have an effect here more than people thought

p.s want a real giggle read professor neferous thread

i have come to this site to gauge public perception and perhaps pass some of what i have discovered is happening and perhaps save some people from big mistakes ..

i dont have anything to do with making money out of property like many posting here who make a living from it .

i have made money on property in the past and large sums (details in other posts)

i still own but country land .

so i have nothing to gain by being here enjoying the discussions going on and having my say also .. i have respected others since i have been here yet been called many things .

we are at a very interesting time in our development as a country and a big **** taking place on a world scale its been fasinating watching it play out so far . my humble opinion is we headed for times not many here have ever experienced .

Now i dont know you and i dont claim to be a wizard at predicting markets or trends but..
The thing is your posts follow a similar line to many before it.
You may be right but if your not i bet you will sail off into the sunset never to be seen again. Only to be replaced by a newbie preaching the same lines. Im not targeting you im just picking up on a theme that has become very apparent to me in a few short years here. things like

We will have a crash of( Blah blah) size on the (blah blah). Here is a ( blah blah) graph showing how im right. Look at this artical from the (blah blah) confirming what i say. You will all loose money. Its different etc etc.
You may be right or you may be wrong.

I think people tend to bite when they see that same pattern form in posts.
Like i said i am not a whiz at this i just learn as much as i can from both sides.

Im tired. 14hour day. Im going home

 

[devo76]

Are you suggesting I live in poverty for a decade paying half my pension into a neg geared prop on the grounds that "Someday I'll be rich!!!!!"?

You guys are like Jehova's Witnesses. You try to tell people twice your age what to believe.

In that example. hell no. why would you.
But what about a property that costs you nothing. Will make a small profit in years to come and also has a good chance of making a gain in value in years to come. Why wouldnt you have a go.
If you have one foot in the grave ( not talking about anyone perticular )then sure your window is a bit smaller to make things work. But what about everyone else.

 

[WinstonWolfe]

Are you suggesting I live in poverty for a decade paying half my pension into a neg geared prop on the grounds that "Someday I'll be rich!!!!!"?

You guys are like Jehova's Witnesses. You try to tell people twice your age what to believe.

Now seriously SF, bugger whether property is going to be more in 20 years.....how about the gold price in AUD being more in 2 weeks???

 

[Ausprop]

Now seriously SF, bugger whether property is going to be more in 20 years.....how about the gold price in AUD being more in 2 weeks???

or less? and vs. 3 weeks? this is a whole new ball game

 

[urbanprospector]

Now i dont know you and i dont claim to be a wizard at predicting markets or trends but..
The thing is your posts follow a similar line to many before it.
You may be right but if your not i bet you will sail off into the sunset never to be seen again. Only to be replaced by a newbie preaching the same lines. Im not targeting you im just picking up on a theme that has become very apparent to me in a few short years here. things like

We will have a crash of( Blah blah) size on the (blah blah). Here is a ( blah blah) graph showing how im right. Look at this artical from the (blah blah) confirming what i say. You will all loose money. Its different etc etc.
You may be right or you may be wrong.

I think people tend to bite when they see that same pattern form in posts.
Like i said i am not a whiz at this i just learn as much as i can from both sides.

Im tired. 14hour day. Im going home

did you follow my posts i have given details of what i done over the years also i can give you a link to the other place i chat if you like .only reason i been here a short time is the fact i came across this doing research .

14 hour day ..i do remember them and longer .
in the uk country where wages where nothing paying a mortgage ''
i restored a 600 y/o house there also ..

i am australian born in perth but was married to a pom i met in the shents public bar .

like i said i have nothing to gain from being here apart from perhaps some more knowlege and the interesting discussion ..

cant see trend changing from what a posted before if i have reason to think things will i will post .

this week will be the telling one dow below 10 000 and dropping

silver may pull back but the dropping aussie dollar to limit the drops gold bullish in aussie should take out old high . trying to work out where i think it will peak this run ..
expect markets to get more volatile as very uneasy times

 

[WinstonWolfe]

or less? and vs. 3 weeks? this is a whole new ball game

true, but I can make money when it is going up or down. I can use stop losses to limit the downside. I can short it for a week and simultaneously long it for a year. I can leverage the same ratio as property. I can do an inverse algo pair trade with gold and palladium. It's a nice break from dealing with builders who want to finance their next 4WD on the back of my risk.

 

[devo76]

Look I honestly haven't followed you too much but you do seem to have your finger on the pulse a bit . I guess you could say I follow the law of averages. Lots of things could happen both good and bad. I'll plan for the middle. And the fact that I have a 20 Year investing window. There's plenty of room for error. Who's right or wrong. Probably both of us and neither of us. As you say time will tell

did you follow my posts i have given details of what i done over the years also i can give you a link to the other place i chat if you like .only reason i been here a short time is the fact i came across this doing research .

14 hour day ..i do remember them and longer .
in the uk country where wages where nothing paying a mortgage ''
i restored a 600 y/o house there also ..

i am australian born in perth but was married to a pom i met in the shents public bar .

like i said i have nothing to gain from being here apart from perhaps some more knowlege and the interesting discussion ..

cant see trend changing from what a posted before if i have reason to think things will i will post .

this week will be the telling one dow below 10 000 and dropping

silver may pull back but the dropping aussie dollar to limit the drops gold bullish in aussie should take out old high . trying to work out where i think it will peak this run ..
expect markets to get more volatile as very uneasy times

 

[urbanprospector]

Look I honestly haven't followed you too much but you do seem to have your finger on the pulse a bit . I guess you could say I follow the law of averages. Lots of things could happen both good and bad. I'll plan for the middle. And the fact that I have a 20 Year investing window. There's plenty of room for error. Who's right or wrong. Probably both of us and neither of us. As you say time will tell

how old are you im 42 ... .. hey and wish you the best of luck .. when you have just check over my posts ..

but don't discount some wise advise ..is a few here worked it out ..
we appear bad now as going against the general feel .. i doing dam well

 

[devo76]

how old are you im 42 ... .. hey and wish you the best of luck .. when you have just check over my posts ..

but don't discount some wise advise ..is a few here worked it out ..
we appear bad now as going against the general feel .. i doing dam well

I'm 32 mate. Young enough to do stupid things but old enough to regret them the next day.
I do take everything on board and i will give advice when I feel I am in the position to do so. Still learning for the most part at this stage.

 

[BV]

Are you suggesting I live in poverty for a decade paying half my pension into a neg geared prop on the grounds that "Someday I'll be rich!!!!!"?

Not me mate, I doubt that we'll see property prices going up by much more than the CPI for the next 5 years.

You guys are like Jehova's Witnesses

haha
Personally I'm not trying to tell you anything.
I'm just saying that people live longer these days.
It doesn't mean that our seniors should start investing in property, they should be reducing risk instead.

 

[Sunfish]

I'm 32 mate. Young enough to do stupid things but old enough to regret them the next day.
I do take everything on board and i will give advice when I feel I am in the position to do so. Still learning for the most part at this stage.

You are not qualified to give advice. There is no surer way to get people's back up than to give gratuitous advice.

Give an opinion by all means when someone asks, but I have not asked.

 

[Piston Broke]

I can only apply my “bush” economics and say:

• 1 Residential property price is all about supply and demand
• 2 As people have to live somewhere

My experience tells me:
1. Does not apply in a manipulated market.
2. This does not mean they actively do some thing about.


[off topic]

"Those with the money end up with experience, and those with experience end up with the money" - Harvey Mackay

Yeah! It was Harvey M in "Swim with the sharks" lesson 35.
New I'd seen it somewhere. Great Book btw.

 

[BayView]

A general question for the bulls: Did you see the GFC coming and did you recognise the US property bubble for what it was?

If you didn't, why do you think you are better informed now?

I would say that the majority of the world didn't see it coming, otherwise it probably never would have happened.

What did happen of course is the majority of the world carried on like there was never going to be another bad day, and they wouldn't lose any money. And, this was from some of the brightest (supposedly) financial minds around the globe.

A very similar series of attitudes and mindsets were the norm leading up to the '29 crash.

There were a few though who always think that a bad day is just around the corner and plan accordingly.

What great joy for them there is if it doesn't happen.

For me personally, I didn't see it coming, but we weren't greatly affected other than to make the finance for the workshop harder to secure.

The GFC simply confirmed my view that the worst can happen, so expect it, and plan to avoid it.

 

[Hdb]

A general question for the bulls: Did you see the GFC coming and did you recognise the US property bubble for what it was?

If you didn't, why do you think you are better informed now?

Did you see the GFC coming. If you did why did you buy an IP just as the s... hit the fan in 2007.

 

[.toe]

The point of how much fcf we have left to service debt is something I have tried to clarify for some time.

WW I wonder if this helps...

Income After Repayments


Housing Affordability Index doesn't take into account variations in interest rates, this does. In 2007 Income after repayments was at its highest point, since then prices were flat through 08/09 and booming in 09/10, but interest rates have been very low. So I presume Income after repayments would still be high even now.

Not to forget the average interest rate of 1980-1990 was 14%, lately the average is below 7%.

 

[BV]

i sold when many bought .high demand then ..i know i did the right thing
then i bought gold and silver.

Timing your market is not a bad thing.

Regarding the Perth market, I was never convinced that such high prices were justified. Its the same with Darwin now, its a matter of time before the correction or stagnation comes.

Even in the more popular Sydney,Melbourne, Brisbane markets we don't have to be rocket scientists to work out that a property selling for 1.5mil is overpriced and over time its price will come back or will stagnate.

With down to earth properties yielding 6 and 7% in our cities, altough people say these are very sensitive to interest rates I dissagree because of the bigger market base. These are still the most affordable so if A Smith can't afford a property, B Smith will and there is plenty of B and C Smiths around.

Good choice with the gold but you were lucky in a way that money is running to safety. If Europe wasn't in trouble things would have been much different.

 

[BV]

But to the question: There is almost no chance of a rise, in Townsville (no point telling me about Melbourne), probable scenario is 5 to 10% drop with a real possibility of more than 20

I agree, I remember some of your posts back in 06/07 being very upbeat about FNQ, but the times changed, the GFC came people got burned and the speculators are out of the picture so the same growth isn't there anymore

I'll ask again: Did you foresee the GFC and did you recognise the US property bubble for what it was?

I don't know if anyone could have predicted the extend of the GFC.
I certainly saw the dark clouds coming and I was one of the first who moved our super to safety.

I still haven't recovered from the shock btw. I certainly came out of my rock a few times, tested the waters, did some spontaneous buys and seeing that the storm isn't going away I immediately crawled back under my rock.

 

[Sunfish]

Did you see the GFC coming.

Yes I did see it coming. If you care to check the posts of "Thommo" you can confirm this. I was also talking about peak oil ( "Aceyducey" was warning us too) in '05. Allied to peak oil I predicted the "resources super cycle" with a special mention of uranium and gold/silver as standouts. (Uranium DID take off soon after).

The point I'm making is that you guys seem qualified to tell me what property prices will do in the next ten years when none of you could see that the housing bubble in the US was a ticking time bomb and that Greenspan's reckless spending had to fail.

 

[Graemsay]

There were a couple of questions posted earlier today about the future direction of the market. Being a bearish D&G merchant I thought that I'd throw in my opinion.

Do you believe [properties] will be worth less in the year 2020 ?

I'm assuming that inflation over the long term sits within the RBA's 2-3% target, and wages grow at an average of 3.5%, which is roughly what I got from eyeballing this chart.

The dotted line represents Australia as a whole.

If house prices track wages over the long term (and I know that several posters will disagree with me on this) then over the next decade I'd expect them to rise by around 40%.

However some commentators reckon that Australian properties are overpriced by 40%, which would require wages rise by 66.7% to bring them back in line.

If my assumptions (above) are correct and there is a market correction then it's possible that house prices would be at about 85% of current levels in 2020, and would take until 2025 to return to today's values.

Do you believe rents will be the same or less in 2020 ?

I'd expect rents to rise with wages, so in 2020 I'd expect them to be 40% higher than they are now.

 

[devo76]

There were a couple of questions posted earlier today about the future direction of the market. Being a bearish D&G merchant I thought that I'd throw in my opinion.



I'm assuming that inflation over the long term sits within the RBA's 2-3% target, and wages grow at an average of 3.5%, which is roughly what I got from eyeballing this chart.

The dotted line represents Australia as a whole.

If house prices track wages over the long term (and I know that several posters will disagree with me on this) then over the next decade I'd expect them to rise by around 40%.

However some commentators reckon that Australian properties are overpriced by 40%, which would require wages rise by 66.7% to bring them back in line.

If my assumptions (above) are correct and there is a market correction then it's possible that house prices would be at about 85% of current levels in 2020, and would take until 2025 to return to today's values.



I'd expect rents to rise with wages, so in 2020 I'd expect them to be 40% higher than they are now.

So over the next decade there would be a slight chance of negative equity but a good chance that its positively geared anyway.
This may not be a great example of an investment to most on here but to the average punter who blows all the spare cash they have, This would be a good forced saving system for their retirement/kids schooling or anything else that might pop up. Also at that point with no growth, you would be expecting something just around the corner. If you had the luxury of time you would hold a bit longer and continue enjoying the rent.

Like i said. Not a great result but not a bad risk for the average person with plenty of working life left.

PS. This is not advice.... Its my take on things thats all.