world wide financial crash will it make property cheaper

[random]

Soros is the master at seeing bubbles and investing / riding it.

He's tipped gold to move and has put money on it.

Yeah heaps of people are saying buy that's for sure , bugered if I know . I think if I had some spare I could afford to be without for 20yrs just encase , I reckon I'd wait for the next dip and buy . I'd be hoping to sell at 15-16 but I can't afford the gamble right now so will pass.
What's he say about our housing anyway ? I haven't seen his stuff .

Cheers

 

[Aaron Sice]

i just don't want to be left holding the bag when it comes crashing back down again.

does that mean i'm making excuses to NOT ride it? maybe - i'm just really indifferent to metals.

 

[Sunfish]

It's an interesting study random. Surprisingly few people have any real idea of "money" and I would include many here in that group.

When you dismiss "hard" currencies and say that you get paid in fiat, spend in fiat, buy properties with fiat, who cares! you have voluntarily chosen to wear a straightjacket on your mind.

My weekly budget is ALL A dollars like everyone else's but investments do not have that limitation so I want to know the relative worth of differing assets. There is no point in saying your house in Britain has increased in value until you work out if the Pommy Pound has increased or decreased at the same time. It has certainly dropped when measured against the US$.

Has the US$ dropped? Most would say it is strengthening because it is now around 87 against the trade weighted basket but the yen and euro have heavy weighting there. But I say it is depreciating because it does not buy as much gold as it did.

Even if you don't want to own gold (I don't have much) there are many hours of interesting youtube video on the subject and it is hard to accept for a while.

 

[Sunfish]

does that mean i'm making excuses to NOT ride it? maybe - i'm just really indifferent to metals.

I've just had the thought that I'm indifferent to money. Whenever I need a little reenforcing on that I look at my 50 trillion Zim Dollar note.

Fair to say that I am indifferent to property too. I need one to live in (don't have a renter mentality) but any more are, at best, a temporary means to an end. The end, of course, is comfort.

 

[Aaron Sice]

I've just had the thought that I'm indifferent to money. Whenever I need a little reenforcing on that I look at my 50 trillion Zim Dollar note.

Fair to say that I am indifferent to property too. I need one to live in (don't have a renter mentality) but any more are, at best, a temporary means to an end. The end, of course, is comfort.

i just find if i focus on too many things, the important stuff gets diluted.

 

[Sunfish]

i just find if i focus on too many things, the important stuff gets diluted.

We're going nowhere, as usual, but I actually ENJOY the big picture. It isn't making me a millionaire but I do think I'm ahead of the pack.

I lived most of my life without the net and now that I don't work I want to know those things I never knew would be available to me.

Enjoy!

 

[random]

i just don't want to be left holding the bag when it comes crashing back down again.

does that mean i'm making excuses to NOT ride it? maybe - i'm just really indifferent to metals.

Yeah I feel the same .
Although I do think as long as the world remains in a mess this time round, gold will probably be a good trade , maybe better ,for 12 -18mths yet but that's also one hell of a spike so .

 

[random]

It's an interesting study random. Surprisingly few people have any real idea of "money" and I would include many here in that group.

When you dismiss "hard" currencies and say that you get paid in fiat, spend in fiat, buy properties with fiat, who cares! you have voluntarily chosen to wear a straightjacket on your mind.

My weekly budget is ALL A dollars like everyone else's but investments do not have that limitation so I want to know the relative worth of differing assets. There is no point in saying your house in Britain has increased in value until you work out if the Pommy Pound has increased or decreased at the same time. It has certainly dropped when measured against the US$.

Has the US$ dropped? Most would say it is strengthening because it is now around 87 against the trade weighted basket but the yen and euro have heavy weighting there. But I say it is depreciating because it does not buy as much gold as it did.

Even if you don't want to own gold (I don't have much) there are many hours of interesting youtube video on the subject and it is hard to accept for a while.

I see what you mean Sf but, I mainly only view anything stock market from a trading perspective myself and in any quick swing it has for me .That's all I care about .
Although I would like to do some long term buy and holds one of these days but I have my hands full trying to work property out right now so that probably won't eventuate , unless market dives big again .
Although I did notice this one little 24cent gem yesterday actually , looks like it anyway. I expect this baby to be 7 or 8 bucks within a yr or two so I might make an exception and want to do more on it today.
Although it is again in metals , dunno if I trust metals for a hold, it's scary enough trading them right now. But I'll see what some digging , scuse pun, turns up and take it from there.

Cheers

 

[Sunfish]

dunno if I trust metals for a hold, it's scary enough trading them right now. But I'll see what some digging , scuse pun, turns up and take it from there.

Cheers

Horses for courses I guess. I look at the spike in property prices and that scares me. I want out but I think I'll have to swallow quite a loss to do so.

But my mining shares will cover it. LOL

 

[random]

Personally I reckon our property spike should scare people. Is it getting a bit quiet up there sf ?
Maybe you can hedge your bets and add some cheap granny flats, duplex them or something as extra income encase they get stuck . Or add some cheap addition to tempt buyers.
I had a friend in Townsville 7-8yrs back that walled up a big old qlder into 4 flats 25 yrs ago when he first bought it. The bugers been living off it ever since.
Said he did all his own pluming , division walls the lot .

Cheers

 

[Sunfish]

Personally I reckon our property spike should scare people. Is it getting a bit quiet up there sf ?
Maybe you can hedge your bets and add some cheap granny flats, duplex them or something as extra income encase they get stuck . Or add some cheap addition to tempt buyers.
I had a friend in Townsville 7-8yrs back that walled up a big old qlder into 4 flats 25 yrs ago when he first bought it. The bugers been living off it ever since.
Said he did all his own pluming , division walls the lot .

Cheers

Nah. I'm too old and clapped out for that stuff. No need for it with shares. Besides during the time taken for these upgrades the prices generally will continue to fall anyway. I'll bite the bullet.

In this morning's paper it says "CBD median unit prices have slumped 41% in the March qtr. Latest market research from the REIQ has found the average price of a CBD unit fell to $380k in the qtr, a fall of 41.2%".

An LJ Hooker marketing specialist said that although prices had fallen the impact was "nowhere near" as savage as suggested. He goes on to say that you must compare apples with apples. I assume he is disputing the use of "median" (or is it "average" in this case?) figures. Whod'a thunk it.

Everyone was happy to quote median while it was increasing in spite of the obvious fact that the market was being flooded with new, high end units. The same is true for single dwellings. There have been thousands of large, flash McMansions built which will cause an increase in median but not necessarily much of a rise in existing weatherboard homes. Wouldn't it be nice to have some consistency though?

Actually random I think Townsville has hit the wall. Our prices never went to the absurd heights that southern capitals did so actual drops for suburban homes will not be anything like 40% but until the Super Tax is killed there will be no joy in property here. (Fly in/fly out miners were big buyers of units)

 

[Aaron Sice]

Yeah I feel the same .
Although I do think as long as the world remains in a mess this time round, gold will probably be a good trade , maybe better ,for 12 -18mths yet but that's also one hell of a spike so .

don't get me wrong, i'm not denying it will be a good investment, i just haven't the broader, macro knowledge to confidently time my entries and exits correctly.

said it before - buy and hope is NOT an investment strategy, so i stay out.

i'm a focussed kind of person, i find a niche, i exploit it, profit from it, repeat.

 

[hobo-jo]

Everyone was happy to quote median while it was increasing in spite of the obvious fact that the market was being flooded with new, high end units.

Isn't it funny what measurements becomes acceptable/not acceptable depending on what prices are doing!

It's like for a long period of time we accepted house prices as a multiple of a single income was a reasonable measurement/gauge of fair price, then it became household income, now they are referring to a percentage of disposable income...what next?

 

[oracle]

.....
We need the 100yr chart , WW , if you happen to drop in , wouldn't happen to have it kicking about by any chance ?

Cheers

I was reading this e-book on stocks and there was this chart that showed the performance of Gold, Common stocks, Treasury Bills, Dollar, Bonds starting 1802 to 1996 (inflation adjusted)

Sunfish is absolutely right, Dollar has devalued and is worth less in 1996 then it was in 1802. Unfortunately, property is not shown, but I would expect its returns to be similar to common stocks. On the other hand Gold has not lost it value over time, but hasn't returned much at all above inflation.

(PS: I am not sure if I am violating any copyrights. If I am Mods please remove the chart)

Cheers,
Oracle.

 

[BayView]

i guess i'm asking as a relative wants to enter the market and i wonder if it could get tougher for him to make replayments as another relative will probably go as guarantor or somehow help him enter the market and i dont want them both to crash.

Regardless of a financial crash, the ability to repay your loans rests solely with you.

If the next GFC means your relative might lose their job, then yes it will be tougher for them.

In my opinion everyone should be investing with the attitude that there might be another GFC tomorrow, and borrow accordingly, and select their investments accordingly.

Many will scoff at this and say take a mouthful of concrete and harden the fark up, but no-one ever went broke by being able to make their loan repayments in business or investing.

two things will happen for sure in the next GFC -
1. There will be lots of distressed sellers like there always are. This will have an affect on prices, but not everywhere and not at every price point.

2. The lenders will make it tougher to borrow, which means less buyers, which means less demand, which means lower prices, or stagnation.

So, the cup half full view is that the properties will be relatively cheap for those who can access finance to buy them.

Just don't be a seller during the next one.

GFC = straw hats in winter, kids.

 

[hobo-jo]

I was reading this e-book on stocks and there was this chart that showed the performance of Gold, Common stocks, Treasury Bills, Dollar, Bonds starting 1802 to 1996 (inflation adjusted)

A bit of a deceiving chart really...e.g. Can you name 1 stock that was around in 1800?
Without knowing exactly how they have come to those figures I assume they are using some sort of index which is constantly cycling the stocks that make up group it represents, so buying specific blue chip stocks is not necessarily the haven that chart makes it out to be.

 

[oracle]

A bit of a deceiving chart really...e.g. Can you name 1 stock that was around in 1800?
Without knowing exactly how they have come to those figures I assume they are using some sort of index which is constantly cycling the stocks that make up group it represents, so buying specific blue chip stocks is not necessarily the haven that chart makes it out to be.

You might be right. They might be using some indexing for stocks. But stock performance aside. Gold hasn't changed since 1800. It's performance is what should be debated. That is what the poster requested to see the performance/chart of gold for past 100 years.

Cheers
Oracle

 

[hobo-jo]

Gold hasn't changed since 1800. It's performance is what should be debated. That is what the poster requested to see the performance/chart of gold for past 100 years.

Ahh fair call, missed you were responding to the Gold chart request.
Most that invest in Gold would refer to it as a store of wealth, that chart you provided would indicate that it has played it's role quite well

 

[random]

Here's one way to look at it .

Fred bought $1000 bucks of gold 100yrs ago

Tom bought $1000 bucks of Australian property 100yrs ago

And Jack bought $1000 bucks of BHP shares 100 yrs ago .

On Monday morning they each go and sell their lot .

So who has the most money Monday arvo , Fred, Tom or Jack ?

Cheers

 

[Francine]

thanks so much. Yes i once read that they should calculate what they can afford using a higher interest and not over commit,

thanks so much.