will house prices continue to double every ten years?

Just curios to know whether people think houses will double in price every 10 years in the future??

I found this video on youtube.

http://www.youtube.com/watch?v=r1I1YlBV93M&feature=related

I would think that if you had no cycles under your belt and planned to retire within ten years, then you might be pushing it a bit. If you allow a little longer on this one( say 15 years) or be a bit more creative then just buy and hold then I still think the odds are good.
20 plus years for the younger ones in the game should still be laughing.
 
My theory is that property has gone up 3 fold and more in just 10 yrs , so next up correct proportions will need to be reestablished first .
There's no law against creativity though !

Cheers
 
Did proprty prices double between 1990-1997 ?

I think that this statistic that is often quoted by the so called "experts" is highly questionable.

You should not rely on this type of capital growth when investing. The only statistic you should look at is the yield of the property. If capital gain happens, it is a bonus.

Extreme levels of capital growth should ring warming bells for investors.
 
Extreme levels of capital growth should ring warming bells for investors.
Extreme levels (however you define that ) of CG does warm the cockles of my heart :)

The only statistic you should look at is the yield of the property. If capital gain happens, it is a bonus.

However, this is not particularly attractive to investors.....at all!

Borrow money at 7%, pay a PM, pay rates, pay insurance, put up with tenants, pay maintenance, have some vacancy for a standard 5% yield.....heck make it 10% - and investing in property just is not worth it....AT ALL!

You can get better (and safer) nett yields on term deposit. It has to be a combination, and if you are not getting CG - forget it. :cool:
 
Extreme levels (however you define that ) of CG does warm the cockles of my heart :)



However, this is not particularly attractive to investors.....at all!

Borrow money at 7%, pay a PM, pay rates, pay insurance, put up with tenants, pay maintenance, have some vacancy for a standard 5% yield.....heck make it 10% - and investing in property just is not worth it....AT ALL!

You can get better (and safer) nett yields on term deposit. It has to be a combination, and if you are not getting CG - forget it. :cool:

Hi prop, ive been holding a property on the gold coast since 2006, we bought for 345k . We could sell for about 400k. ? would you wait a few years more or cut your losses and put your money elsewere ?
 
Extreme levels (however you define that ) of CG does warm the cockles of my heart :)



However, this is not particularly attractive to investors.....at all!

Borrow money at 7%, pay a PM, pay rates, pay insurance, put up with tenants, pay maintenance, have some vacancy for a standard 5% yield.....heck make it 10% - and investing in property just is not worth it....AT ALL!

You can get better (and safer) nett yields on term deposit. It has to be a combination, and if you are not getting CG - forget it. :cool:

Agreed.....

But what makes you think that capital gains are guaranteed ? Because they are not !

Capital gains have been the by product of lax lending standards and the increase availability of credit. Also coupled with the various grants our government has been handing out left right and center. This is slowly, but surely coming to an end.....and when it does it will suck the demand out of the market......as it is already starting to show.

Your rent should be seen as the primary source of income.....and the fact that rental yields have been so low, shows that real estate is extremely overvalued in Oz.

The above has occurred in all the economies that went through a real estate boom...whether it be the US, Ireland, Spain, or the UK.

The crunch will happen here too. And thinking that it won't is like saying that the laws of physics don't apply here either....it is simply wishful thinking. The government may try to slow it down with various methods (increasing the timeframe of the grants, lowering interest rates etc.) but it won't do much good. Sooner or later the market will find it's median price. (US, Europe have much lower interest rates than Oz, but it didn't stop the crash).

Interesting times people.......
 
Hi prop, ive been holding a property on the gold coast since 2006, we bought for 345k . We could sell for about 400k. ? would you wait a few years more or cut your losses and put your money elsewere ?

A full property cycle normally goes for between 7 - 12 years. Now you are asking if you only owned a property for 4 years (2 of which were supposed to be like the Great Depression of the 1930's) and you have not had much growth in that time, should you get out? :confused:

My response would be to actually go into the investment with a minimum 7 year time horizon. If you can't do that, then don't start worrying at the 4 year mark.

How do you know if you "put your money elsewhere" as you say, that it would perform any better?
 
A full property cycle normally goes for between 7 - 12 years. Now you are asking if you only owned a property for 4 years (2 of which were supposed to be like the Great Depression of the 1930's) and you have not had much growth in that time, should you get out? :confused:

My response would be to actually go into the investment with a minimum 7 year time horizon. If you can't do that, then don't start worrying at the 4 year mark.

How do you know if you "put your money elsewhere" as you say, that it would perform any better?


atism would have made more from investing in mining stocks 4 sure.......much more.....
 
But what makes you think that capital gains are guaranteed ? Because they are not !
The only thing that makes any investor think that what has happened in the past will continue to happen is just that. Despite people holding views like your own, they have been proven wrong over and over again....and the chances are that they will continue to be so. Cycles come and cycles go - boom - bust over and over - you can set your (economic) clock by it.


Capital gains have been the by product of lax lending standards and the increase availability of credit.
That is, to even the casual observer, utter non-sense. The availability of credit in the last 12 - 18 months has been restricted and lending standards have also tightened, yet capital gains in Sydney, Melbourne, Canberra etc have been exceptional in that same period.

Also coupled with the various grants our government has been handing out left right and center. This is slowly, but surely coming to an end.....and when it does it will suck the demand out of the market......as it is already starting to show.
And prior to the grant of $7K commencing in 2000, what was all the CG about in those previous years? :rolleyes:

Demand for housing comes from population growth - both organic and imported (immigration). Supply is still held back. Oh geeze, this is boring....


Your rent should be seen as the primary source of income.....and the fact that rental yields have been so low, shows that real estate is extremely overvalued in Oz.
Yawn.......you can stop talking now, I've stopped listening.

No-one is forcing you to buy property. Go buy some shares if you want - its all good.
 
Did proprty prices double between 1990-1997 ?

I think that this statistic that is often quoted by the so called "experts" is highly questionable.

You should not rely on this type of capital growth when investing. The only statistic you should look at is the yield of the property. If capital gain happens, it is a bonus.

Extreme levels of capital growth should ring warming bells for investors.

No, but it didn't take too long to double after 1997 for those who managed to hang on.
 
There will be people around who can afford to buy and those who can't. Has it ever been any different???

Yes it has. People were living within their means, and were able to buy a house wherever their level of income allowed them to. Debt was a "taboo" and mortgage debt was restricted by the banks with at least a 30% deposit.

Now it's every man and their dog..........not for long though.
 
Yes it has. People were living within their means, and were able to buy a house wherever their level of income allowed them to. Debt was a "taboo" and mortgage debt was restricted by the banks with at least a 30% deposit.

Now it's every man and their dog..........not for long though.

People who live within their means can still buy "a house wherever their level of income" allows them to :confused:.

But I don't think my dog could buy a house :D.
 
Did proprty prices double between 1990-1997 ?

I think that this statistic that is often quoted by the so called "experts" is highly questionable.

You should not rely on this type of capital growth when investing. The only statistic you should look at is the yield of the property. If capital gain happens, it is a bonus.

Extreme levels of capital growth should ring warming bells for investors.

Did shares double between 2007 and 2009?

You can pull any window out and support your arguments. FP's have been doing it to sell their managed funds for ever. :eek:

The only way to evaluate it is to look at the trend over a period os say 50 years or more.

This is assuming you are using cash to invest, and not allowing for the benefits of leverage.

But when you factor in leverage, now yer seeing a different picture.
 
See, no they can't.

You have people out there who earn well above an average wage, but will not sacrifice 35 years of their life just to buy a house. They would rather rent.

They will not go out and live in a suburb with a demographic in which they don't "belong too".

It is as simple as that.
 
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