just wondering what this means Kenneth? Are you saying that because Australia is a religious country (which I am not so sure about) that God will prevent recession?
Will Australia's next property boom be the greatest boom we've ever seen?
- Thread starter Shadow
- Start date
just wondering what this means Kenneth? Are you saying that because Australia is a religious country (which I am not so sure about) that God will prevent recession?
Well , sounds like you've made it you lucky sh't.
But please - watch out for buses and the like when you leave the vegie patch and head for town . lt's times like those that we tend to walk straight infront of the damn things.
Cheers
l dunno l dunno.
Not crazy about the vibe on this thread despite the polls , graphs and anything else . l guess it lends to what l really feal regardless .
But to tell you the truth - well to start with do you read Martin Weiss.
l get his reports for the stock market . Pretty clued in guy l reckon, one of the most and .
His saying the US is going down , quickly.
Then the thing is , we've just been through and in places still are what l read as crazy times so there has to be a bang surely it's just a matter of when and is there room to cash in on what's left before hand ?
lt just seems here in Oz we have had allot of very unnatural times and rode all out unnaturally some very nasty storms smiling all the way .
Then there's our property prices , to me very unrealistic .
Don't know , feeling very uneasy about it all especially after Martins latest.
Umm , Cheers
PS , wish l knew how the stock market is going to respond to.
Not crazy about the vibe on this thread despite the polls , graphs and anything else . l guess it lends to what l really feal regardless .
But to tell you the truth - well to start with do you read Martin Weiss.
l get his reports for the stock market . Pretty clued in guy l reckon, one of the most and .
His saying the US is going down , quickly.
Then the thing is , we've just been through and in places still are what l read as crazy times so there has to be a bang surely it's just a matter of when and is there room to cash in on what's left before hand ?
lt just seems here in Oz we have had allot of very unnatural times and rode all out unnaturally some very nasty storms smiling all the way .
Then there's our property prices , to me very unrealistic .
Don't know , feeling very uneasy about it all especially after Martins latest.
Umm , Cheers
PS , wish l knew how the stock market is going to respond to.
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Hey all,
Prices stagnate or fall when supply exceeds demand right? Given that population is increasing in Oz capital cities the underlying demand is there.....
now say that access to credit starts to dry up, or servicability gets killed due to rate rises (ANZ just raised its variable rates 0.2 independantly), it could have a few impacts...
1) People who were going to borrow and buy a PPOR who now cant still need a roof over thier heads, putting more stress on rental market...upward pressure on rents
2) People who were maybe thinking of investing in property think "helll no, i cant service that debt, prices are too high already" less new rental stock on the market....upward pressure on rents
3) we may see a stagnation in house prices,especially if access to easy credit goes by the by, but my logic and gut feel is that rents will be the next big boom....followed by house prices once the pent up demand from delayed purchases is vented in a couple/few years time
Any thoughts?
Prices stagnate or fall when supply exceeds demand right? Given that population is increasing in Oz capital cities the underlying demand is there.....
now say that access to credit starts to dry up, or servicability gets killed due to rate rises (ANZ just raised its variable rates 0.2 independantly), it could have a few impacts...
1) People who were going to borrow and buy a PPOR who now cant still need a roof over thier heads, putting more stress on rental market...upward pressure on rents
2) People who were maybe thinking of investing in property think "helll no, i cant service that debt, prices are too high already" less new rental stock on the market....upward pressure on rents
3) we may see a stagnation in house prices,especially if access to easy credit goes by the by, but my logic and gut feel is that rents will be the next big boom....followed by house prices once the pent up demand from delayed purchases is vented in a couple/few years time
Any thoughts?
Or when demand falls. Underlying demand to purchase only translates to actual buying IF people can get financing. If the entry-level people can't get as much financing because unemployment is high, interest rates are high and/or bank criteria are tight, that decreases demand. If people can't buy, they rent. Undersupply doesn't automatically translate to higher prices.
Exactly. People can choose to rent or buy. If they can't buy because they can't get the loans for it, they'll rent instead. There is always a group that can get loans when lending is loose but can't get loans at all when it's tight. That fringe group is what powers the boom at the last stages.
Sounds about right. I'm also expecting stagnant or falling prices, but at the same time rising rents. Now, if you can hold through this period, the pent up demand will sow the seeds of the next boom.
However, in the short term you may well find that interest rates go up (inflation is a worry), and a stagnant market and tighter lending may mean it's difficult to refinance. Yields are still pretty low, though I expect them to increase via a combination of lower prices and higher rents.
The key is to make sure you have enough cashflow to get through this period.
Alex
hmmm.. so Americans, Malaysians, Japanese, Sinpaporeans et al must suffer because they are not "god fearing" nations... hence thy lord wont show any of them his benevolent mercy and let their property values stagnate for a long time....
what a load of tripe !
Well said NateDog, I agree. Increasing rents is one of the factors fueling the next big boom.
You should come over here to the GHPC Forum to help me out. I have been having this debate with those guys for a couple of days, but it's only one of me against 20 of them!
Any other Somersofters want to help me out...
Cheers,
Shadow.
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You simply cant stop at increasing rents.. if property prices are stagnant while rents have increased (as well as oil, food, energy bill etc), and labour market is tight due to low unemployment .. and labor govt is unwinding workplace relations as well as handing more power to unions .. guess what .. wages are likely to increase.. wat does this all means .. inflation .. and lots of it ..
im all for it ... then you can really forget about measly 0.25% increases .. maybe someone who invested in the 70s and 80s can tell us what happens then …
im all for it ... then you can really forget about measly 0.25% increases .. maybe someone who invested in the 70s and 80s can tell us what happens then …
Hey Alex,
After all this time of being on somersoft i still cant work out the proper way to quote peoples posts
"Undersupply doesn't automatically translate to higher prices."
Agreed not straight away if finance is tight etc, but like you mention later in your post it does lead to pent up demand....to possibly fuel a bigger boom later on....
and with rising rents the pain of holding IPs should lessen with time....something you also mentioned.
In relation to falling prices i guess the beauty of the Australian property market is the fact that approx 70% of owners purchased because they wanted a roof over thier heads to call thier own, not mainly as an investment...people who already own a home wont sell unless they have to, they will continue to pay the mortgage pay thier bills and not give a second thought to whether comparable homes in thier suburb are selling for more or less than they were in the past.
They will take the pain of higher mortgage costs on the chin...as long as they can.....
and if they cant (job loss, interest rates go too high divorce etc.)...they may sell and realise a loss...but they still need to live somewhere....pressure on rents again.
Cheers,
After all this time of being on somersoft i still cant work out the proper way to quote peoples posts
"Undersupply doesn't automatically translate to higher prices."
Agreed not straight away if finance is tight etc, but like you mention later in your post it does lead to pent up demand....to possibly fuel a bigger boom later on....
and with rising rents the pain of holding IPs should lessen with time....something you also mentioned.
In relation to falling prices i guess the beauty of the Australian property market is the fact that approx 70% of owners purchased because they wanted a roof over thier heads to call thier own
, not mainly as an investment...people who already own a home wont sell unless they have to, they will continue to pay the mortgage pay thier bills and not give a second thought to whether comparable homes in thier suburb are selling for more or less than they were in the past.They will take the pain of higher mortgage costs on the chin...as long as they can.....
and if they cant (job loss, interest rates go too high divorce etc.)...they may sell and realise a loss...but they still need to live somewhere....pressure on rents again.
Cheers,
i actually went over to GHPC and had a look at the link you had earlier in this thread....i did feel like helping you out
You were holding your own quite well i thought....
can someone help me...ive worked out how to quote a whole post....but not bits and pieces...
Cheers,
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When you borrow to buy property, inflation isn't always a bad thing. Say property prices go up at the rate of inflation. The 'real' value of your property stays the same but the 'real' value of your mortgage is decreasing.
Alex
I was pondering this for a long time and looking for an answer. I had thought as you do but apparently, an allowance for inflation is built into the interest rate.
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Dear Ausprop,
1. Who can effectively control the future nor know the future today?
2. It has been said, " Man may plan, but ultimately it is God who will".
3. Australia was "lucky" enough to have previously escaped relatively unscathed during the last 1997 Asian Financial Crises, 2000 Dotcom Market Crash, 2003 SAR Crises etc.
4.While I am aware that some of the members would disagree with this statement and/or my own views, however, I also believe that each one of us have our own different sets of beliefs.
5. Thus, to each his/her own.
Cheers,
Kenneth KOH
i actually went over to GHPC and had a look at the link you had earlier in this thread....i did feel like helping you out
You were holding your own quite well i thought....
can someone help me...ive worked out how to quote a whole post....but not bits and pieces...
Cheers,
Hey natedog.
Look if l can quote a whole post believe me anyone can . But it is pretty swoosh the way people pick bits out isn't it - can't do that one either !
Cheers
*****************hmmm.. so Americans, Malaysians, Japanese, Sinpaporeans et al must suffer because they are not "god fearing" nations... hence thy lord wont show any of them his benevolent mercy and let their property values stagnate for a long time....
what a load of tripe !
Dear Harris,
1. You have inferred and make your own invalid sweeping "conclusions" for yourself, which I did not say in my previous post;- though the level of human greed in a particular society has been used and put forward to be one of the fundamental key factors used to explain the different levels of housing boom/bust in the various countries.
2. Among the many theories that were previously offered to me as to why the Australian housing markets are fundamentally different from other Asian housing markets, was that, in general, Australians are not as "greedy" as their Asian counterparts ( or/and their American counterparts? for that matter).
3. Thus, the Australians are less likely to drive up the local housing markets to the same "un-realistically" high levels as their Asian ( and American?) counterparts, such as those have been reported in the various housing markets in Asia.
4. Consequently, this has resulted in a deeper and prolonged housing busts in Asia subsequently, as compared to those that have previously occurred in Australia, to date.
5. While I believe that this observation may be true to a certain extent, it has still not adequately explained why Australia has yet to experience its own "biggest" historical housing boom/bust on record, at this point in time.
6. Not has it adequately explained why Australia was/is such a "lucky" country so as to be able to continually enjoy its prolonged economic prosperity for the last 16 years.
7. Do you have a better argument to adequately explain Australia's present unique economic achievement, to date?
Cheers,
Kenneth KOH
Yes - you pay for it in the interest rate. There is always somebody on the other side of a transaction so there is very rarely a free lunch.
The best targets for a free lunch is the government - they steal it from the wider public and give it to you! Individuals and companies though are harder to rob!
You have to cut and paste the quote tags to the bits you want to quote separately ... like this ....
Hi Alex,
true .. and it works exceptionally well when the asset price is rising (whether its shares, property, commodity, bonds, farm or whatever).. and as you mentioned even if they only rise at rate of inflation.
although if asset prices stagnate or fall (even if its a little bit), and inflation is increasing then this strategy doesnt work very well..
e.g. compare a scenario if a person bought in outer syd/melb in 03, vs one that is buying now...i.e. prices dropping a few percent for last 4 years, inflation increasing around 3% (personally i think it would be even more), cash rate and bond rates above 5% on average over that period .. even if u say cashflow is neutral over that period its becomes a massive difference..
anyways, dont mean to hijack the thread.. you guys continue the discussion
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