Though everyone negatively geared is speculating, not investing. So there is a highly speculative slant in the Australian property market which has been the downfall of many other property markets around the world. Noone thought it could happen to them, until it did.
I don't agree that everyone that negative gears is speculating. I negatively gear development sites. I am not betting that the value goes up... I am waiting until I get myself organised to develop. Once developed, both my sites will be positive cash flow. I also know that the prices of my blocks does not steadily increase. It increases and decreases with the property cycle. I have owned one in Melbs for long enough to see it almost double in value and then fall back to close to it's original price (based on comparable sales in the area). But don't ask me. My LVR is 50%. I'm not a gambler.
Well that prediction was made by Ray White, so what do you expect? If they had predicted the $1M Sydney median by the end of 2015, rather than 2012, then they would have been much closer to the mark. But at least they got the direction right, which is a lot more than can be said for the bear predictions of 40% crashes etc. Sydney's median house price is around $750K now, an all-time-high, and still rising pretty fast.
Gold was $A515 in July 2003, today A$1450. Almost tripled.
It may have tripled in actual ounce value, but you haven't factored in all the other aspects of property investment that improve the return on one's invested cash.
