Will Australia's next property boom be the greatest boom we've ever seen?

[BayView]

I find it amazing that neither San Fran or L.A are in that list. Those two places are joke what you get for a million dollars. Just a very ordinary house.

I guess if you look at the prices in terms of expense related to income, then that's probably why; there are a lot of very high income earners in these two cities, but I don't think it is refelctive; I reckon that the amount of income for the high earners is SOO high that it distorts the real average.

This is probably the case with Sydney too I reckon; a good number of exhorbitent wages distort what the majority are earning, making it appear higher, thus making it appear houses cheaper.

Methinks the list is not very accurate.

 

[blaster]

Yep l tend to go with the few above here actually , and the LA /Sydney stuff.
l think to with Sydney to , allot of interstaters relate the harbour , opera house and that whole scene , with living in Sydney . But the truth is on an average budget they won't be able to get near it and the traffics so bad it's hardley worth driving to from outer suburbs where it's just as ordinary as most other places . So with all that plus the actual house prices then the high cost of living in Sydney , lots of disappointments in the long run.
And then say Brissy was real value 7 yrs ago but now it's no better than anywhere else so people might start thinking they may as well have stayed home where ever that is and it's bloody hot.

FHB's charts pretty cool though wouldn't you say . l mean if that was stock l'd be thinking the best has well been and gone now for a long time to come but if you buy at the lows of each ripple you can still do well - ha ha. Now there's an analysis for ya
Cheers

 

[Shadow]

I've called you on this nonsense so many times .... that top 20 list has nothing to do with house prices yet you choose to make the connection because it suits you.

YM,

Do you believe that the 20 most expensive countries in the world have cheaper house prices than Australia. Do you really think house prices in London, Paris, Rome, Moscow and Manhattan are lower than those in Australia? I can tell you that they are not. These countries are a lot more expensive than Australia, in terms of both general cost of living, and house prices.

Cheers,

Shadow.

 

[blaster]

PS
Wonder if we can get an upto this minute chart of say the last 50 yrs of each city or specific areas , probly tell us everything we need . Then again charts can also do anything to can't they so maybe not.

Cheers
Blaster

 

[FHB]

FHB's charts pretty cool though wouldn't you say . l mean if that was stock l'd be thinking the best has well been and gone now for a long time to come but if you buy at the lows of each ripple you can still do well - ha ha. Now there's an analysis for ya
Cheers

No guarantees in those projections though, all we can do is look at the probabilities and compare it to what has happened int he past. There may be factors that prevent history repeating. In theory sustained periods of low inflation should constrain house price growth, as we've seen recently, things don't always happen as you'd expect.

I've got more graphs to come.....

 

[FHB]

Back onto Shadow's theory of Sydney outperforming in the near future, looking at these graphs I can see how prices could rise there, particularly if commodities drop off and people and money flow back to Sydney.....

These are median housing costs as a percentage of income, by city. Home owning costs are based on 100% loan for a median house, renting is based on the average 3br house rent. We can probably pick holes in the chosen criteria, but it does provide some indication as to how close we are to peaks in affordability, on a city by city basis.

This chart was provided by Foundation, he has been known to make mistakes on the rare occasion, but he does provide some useful stuff.


Same chart with real dollars instead of percentage of income:

It seems to me Sydney and Melbourne can go higher, Darwin and Perth seem to be reaching their limits, not surprising really. It also shows rents have been dropping in real terms, renters should be able to afford more.

 

[blaster]

Great stuff FHB appreciated , l'll take all the charts l can get.
My fav' and main indicater for stock and it's done me really well so l very much relate , big believer.
Mind you, there has been a few shockers amongst them though that really hurt, to be expected though .

Actually though speaking of projections and a closer look ,if we take it right through it does read like property still has 08 and early 09 left. Although definitely at the caution point though going either for very quick turnover or a long term hold and l think that roughly matches with what Yardney has said , interesting !

Cheers

 

[asdf]

Logically 500k x 10% pr yr for 10 yrs . What a million and a 1/2 bucks for a weather board in some shitty suburb !

You are probably right for those suburbs you have described but there is a massive chronic shortage of stock in the $1-$1.5M mark. Anything decent hitting the market is snapped up on the first inspection with buyers willing to pay massive premiums. Household wage growth at the middle to top end is going through the roof. Guys pulling in $250k - $1M p.a won't bat an eyelid to 0.50% interest rate increases. There is simply not enough houses for sale so theres only one way prices can go. Baby boomers are not falling off the perch any time soon and with the advent of products such as reverse mortgages, they will probably stay in the family home until they pass. They can play with their grandkids on their quarter acre blocks cos their kids are still living in the cities so why move away to a tree or sea change location.

Until we consumers change the way we live and move away from the capital cities with the easy transient lifesyles, inner city and beachside suburbs will benefit from the greatest boom we've ever seen. Its already happening in all major cap cities on the East. Only a deep recession with double digit unemployment in the financial sectors will see a stop to that.

 

[blaster]

Although on the first one , the dip between 90 and 2000 is much lower and allot more drawn out than previous dips .
To me that allows for a abit longer and more agressive boom than previous times.
Then if we add a long period of a very strong economy and a resorces boom into the equation ,plus allot of cashed up buyers , l reckon she has got a good 12 mths or more left in the right places.
l wouldn't be at all surprised if what Michaels saying reads spot on according to that .
Humm , interesting but scary .
Cheers
Blaster

 

[FHB]

Great stuff FHB appreciated , l'll take all the charts l can get.

Be warned, some there have what I'd call extreme views on a crash, some are anti property investing, some just think the boom has over shot and will become good value again in the future, which is a normal thing to happen in any boom.

 

[blaster]

You are probably right for those suburbs you have described but there is a massive chronic shortage of stock in the $1-$1.5M mark. Anything decent hitting the market is snapped up on the first inspection with buyers willing to pay massive premiums. Household wage growth at the middle to top end is going through the roof. Guys pulling in $250k - $1M p.a won't bat an eyelid to 0.50% interest rate increases. There is simply not enough houses for sale so theres only one way prices can go. Baby boomers are not falling off the perch any time soon and with the advent of products such as reverse mortgages, they will probably stay in the family home until they pass. They can play with their grandkids on their quarter acre blocks cos their kids are still living in the cities so why move away to a tree or sea change location.

Until we consumers change the way we live and move away from the capital cities with the easy transient lifesyles, inner city and beachside suburbs will benefit from the greatest boom we've ever seen. Its already happening in all major cap cities on the East. Only a deep recession with double digit unemployment in the financial sectors will see a stop to that.

So are you saying quality stuff in the right cities , nothing to loose ?
What would you think about regional areas then l wonder ?
Because all the cashed ups should force lower incomes out then and off to cheaper pastures l'm thinking.
l love the regional areas becasue they're easier for me to get into and there's always bargains to be had , unless they go stagnate on ya so l don't know what to think of their potential in 08.
Read one of the gruru's saying sell anything regional up now - that was just in dec 07.
Cheers

 

[Shadow]

It seems to me Sydney and Melbourne can go higher, Darwin and Perth seem to be reaching their limits, not surprising really. It also shows rents have been dropping in real terms, renters should be able to afford more.

Thanks FHB. This is exactly what I have been saying.

 

[blaster]

There's a lot of stuff over at

Be warned, some there have what I'd call extreme views on a crash, some are anti property investing, some just think the boom has over shot and will become good value again in the future, which is a normal thing to happen in any boom.

Thanks again FHB, can't wait to get back with more time and study those.
lt's a beautiful Saturday morning here so l'm hitting the beach - reckon if you wanna be a good investor you need to hit that beach now and then , chuckle!

Cheers

 

[FHB]

The rain has finally cleared in Brissie, I'm off for a ride!

 

[want2bewealthy]

Who ticked continual stagnation for the next 10 years?

 

[alexlee]

Who ticked continual stagnation for the next 10 years?

There were two voters for that, it seems. YM?

It would be very unusual, but you can't discount the possibility. I personally expect about 5 years of stagnation.
Alex

 

[yieldmatters]

There were two voters for that, it seems. YM?

It would be very unusual, but you can't discount the possibility. I personally expect about 5 years of stagnation.
Alex

I didn't vote. Just voted now. Strangely enough the number for that one moved to 3!

 

[blaster]

Cancelled !

 

[blaster]

The rain has finally cleared in Brissie, I'm off for a ride!

Just out of curiosity , what cha riden FHB ?
l know , none of my business , sorry !

 

[FHB]

A Giant Iguana.... looking to upgrade to a Norco soon... mountain bikes incase you're confused.....