I always thought people actually SEEK OUT a BA when they have made a decision to buy. I don't think BAs stand on street corners trying to coax people into buying a house
Why all the D&G on this forum now ?!
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I always thought people actually SEEK OUT a BA when they have made a decision to buy. I don't think BAs stand on street corners trying to coax people into buying a house
I always thought people actually SEEK OUT a BA when they have made a decision to buy. I don't think BAs stand on street corners trying to coax people into buying a house
LOL! Me neither, but it would be fun to watch.
Any of the Buyers Agents out there care to try it so we could have a laugh?
I always thought people actually SEEK OUT a BA when they have made a decision to buy. I don't think BAs stand on street corners trying to coax people into buying a house
No, though some play the media extremely well!
Don't misquote me. I have no idea what prices will do into the future. All anyone can say is what they have done in the past, which is, as you've said, doubled every 7 - 10 years.
I do not subscribe to the "it is different, this time" theory and I am more inclined to believe, going forward, that things will keep on doing what they have always done. Only time will tell.
The figures show what the figures show. I am not responsible for CG
I just report the numbers.Just remember it cuts both ways bluestorm. There are many BAs I know, including ourselves, that will not take on clients that we assess to have unrealistic expectations, or want to place demands on us that we don't accept, or who we feel we can't really get along with. No-one needs the aggro.
As a BA, and I'm sure there are other BAs that do this too, I find myself talking clients out of purchasing a property, just as many times as I would encourage them to buy one.
That's just silly. How do you think BAs make a living in a flat or falling market?
What would a BA "talk up" then?That has to be true of almost every profession.
If I get a root canal at the dentist and I ask him if he recommend that I also get the tooth capped, will he say "no"?
If I take my car to a mechanic.................oh I think I'll just leave it at that
It is up to the individual client to make the end decision, in the full knowledge of the inherent bias that comes from asking a professional in ANY specific industry for advice.
See ya.
Who is misquoting you Propertunity. Maybe you should read through your previous posts. This is exactly what you are saying.
There are factors that have lead to the doubling of prices every 7-10yrs (or 3-4x in 15-20yrs). To extrapolate that growth out indefinately is nonsense. Foremost has been the easier access to credit.
Don't misquote me. I have no idea what prices will do into the future. All anyone can say is what they have done in the past, which is, as you've said, doubled every 7 - 10 years.
I do not subscribe to the "it is different, this time" theory and I am more inclined to believe, going forward, that things will keep on doing what they have always done. Only time will tell.
The figures show what the figures show. I am not responsible for CG
I'm sure this topic has been covered a lot on this forum, but are there any threads that prove that property doubles every 7-10 years over a longer term, say 100-200 years.
I have always been of the understanding that on average, throughout the would, property values have increased roughly in line with inflation.
If you look at price gains over the last 30-40 years in Australia its easy to ignore
a) 2 periods of very high inflation
b) a period of 16 years uninterupted economic growth
c) one major property boom where price to income ratios doubled in a short space of time, helped along by banks who lent at ever increasing volumes.
These 3 things alone could cause even the most sane person to believe that prices double every 7-10 years without fail when in reality it takes some significant events for that to have happened which may not be likely in the next 30-40 years.
Or is this doubling thing an event only peculiar to Australia?
Just read this after posting mine. Some of those "factors that have lead to doubling" were mentioned in my post.
There are a few more.
I am starting to think that the perma bulls honestly believe there will be a neverending number of unique factors that will cause property prices to double every 7-10 years in Australia.
Indeed.
And that Australia is different, and prices always go up. So these neverending number of unique factors will only every have a positive effect on Australia property.
As you mention b) a period of 16 years uninterupted economic growth. This means that there is now a whole generation of people who have never experienced a recession or harder times. With easy credit, their mindset it that the gravy train will continue neverendingly.
And also means there will be many people who negligently attribute their last 20 years of experience on a period when this occurred.
I refer you to a previous post I made on the subject:
http://www.somersoft.com/forums/showpost.php?p=713690&postcount=7
So in your view are we at the point where your tiler would normally buy then?
Propertunity, your graphs (last 20yrs) remind me of the "global warming" crowd, who pick a nice start date (1980) for global warming, extrapolate, and say this is the way it will always be, an upward trend.
Prices, from 1926.
http://wealthruproperty.com/Blog/wp-content/uploads/2010/05/Australianhouseprices_thumb.gif
Rises post war during baby boomer times, and again in the current period. Less than impressive at other times.
I believe we'll be in one of the less than impressive times, and prices will come back 20-30% to trend. (poor FHO ;-) ). Your $800K Sydney LGA median will be more like $550-600K.
While it may be true to say both stock and property have both done roughly 11.5%/yr growth over the last 150yrs, you would have to agree that is not steady. The sharp spike the past 15-20yrs in property, has seen a move that way ahead of historic trend. Why the property bulls don't see a possibility of a 20-30% or 40% correction to trend, I don't understand (it's happened many times before in both property and stock). I very much believe we'll see it again, with what is slowly developing around the world, and am develeraging accordingly.
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Wow, so it looks like its very possible for house prices to suffer a 10-20 year period with no real gains.
At least when this happened in the past , investors were still getting a realistic yield. Imagine no price gains with the yields on offer at present for even 10 years!
EXCEPT that I am not saying that is the way it will always be.
I said no-one knows.You need to do what you need to do based on your own beliefs.
Obviously, I and a number of others, believe something different.
It is perfectly OK in any market for the participants to hold different views. To use a share market analyogy, the people selling BHP hold a different view to those buying BHP.
Nothing unusual about that.
Can you link this? I don't recall having seen it.
I don't know what graph you are looking at,
but in SYD to describe the 6 year period between 2003 to 2008, which is nearly 1/2 of the last 15 years, as a "sharp spike" is ummmm, mistaken IMO.Sorry, I'll correct myself. That would be 11.5% total return historic trend over the past 100-150yrs (growth + yield), not growth alone.
Yep. What do you think all the negatively geared investors will do if at best they have a flat decade, but more likely some drop in prices back to historic trend.
The huge spike the past 20yrs takes us well above that historic trend. Eventually, despite what the bulls say, both stock and property revert to trend.
Prices on another time scale (back to 1890), but showing much the same story as the first. Boom post war, 1970, and huge spike currently. Apart from that it's at best kept pace with CPI.
http://www.debtdeflation.com/blogs/wp-content/uploads/2009/03/IMG0077_13110796.PNG
There are non. Because house prices do not double every 7-10yrs.
Prices generally historically keep pace with CPI. The 11%/yr total return compounded (or growth + yield) , is probably where the bulls pull this figure out (for doubling every 7-10yrs), and then attribute it to only price growth (not total return), because we have been way off historic trend the past 20yrs, and "prices" have doubled every 7yrs.
Total return from housing.
http://www.aireview.com.au/images/dynamic/20101125/graph07.jpg
I'm expecting 2010-2020 to be a return to historic trend, with either 1) no growth, and prices eaten away by higher inflation 2) a price correction of 20-30% over the next few years.
Scenario 2 is more likely, as no flat growth at best would kill a lot of negatively geared investors who would eventually sell. So a correction of 20-30% is more likely in the short -mid term.
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