The future of Australian property prices

[stacks]

Would you say that a fixed interest rate of 7% per annum is too volatile in this current market?How about 8%?9%?10%? just would like your opinion, will not be taking this for advice, will simply prompt me to do more research.

P.S. What do you believe are good indications that a property is in a quality location?Neighborhood crime rates?Close to shops?A park nearby?

Im not sure you understand what fixed interest is. The highest fixed interest rate for cash deposits is just over 6%

7, 8, 9, or 10% ?? Not available for fixed interest rate on cash deposits. Some managed/index funds may have achieved this in the past but that is no guarantee for the future.

 

[stacks]

If you believe the likes of Troy Buswell

Median house price to hit $850,000

After three quarters of negative growth in median prices - Housing minister mentions the median house price may rise to $850,000 ? Wow...

 

[explod]

If you take out the "sold before auction" and sold after auction" the REIV clearance rate this weekend is 42%

Now we all know that clearance rates are meaningless in isolation, but it is a far cry from this time last year when 80% was the norm. In spite of a reported shortage of property the demand does seem to be plumeting.

The June quarter figures could put the wind up things I fear.

 

[Glen48]

In Las Vegas the building boom is on again yep true sad part is no one whats to own a house in a ghost town or some thing that has been vacant for yrs so they are going for new...how stupid can people be.

And soon it will be here in a burb near you.
Sell now IF you can find a buyer

 

[nunthewiser]

might be the wrong question for this thread.

how far do you think it will fall in YOUR area and why?

from the peak in YOUR area to how much you think it deserves/due to fall in a % basis

in my area with select observation and "money talks" syndrome i have seen actual sold prices at times 40% in same streets to what they were selling for previously.

is this not enough of a fall in your view and you want 80% disccount?

are you spotting same drastic discounts in select listings in areas near you?

do you spend more time bitching and preening on the internet to notice whats happening locally?

how much further do you want/think it will fall?

I personally think there are true diamonds hidden amongst the overpriced crap that have reasons for quick sale but you have to be patient and observant to get them.

i dont want media/guvvy stats/abs etc etc ...... just what you see in YOUR areas

 

[robots]

hello,

gidday Nun, all posts welcome in this thread brother, dont worry about that one

i think the market wrap in the The Age today summed up melbourne, good property still going for good prices

if it has any speck of an issue, ie. parking, kitchen, bathroom, crap neighbours, socialist party/or support gay marriages sticker on the letterbox next door, then you gone

still coming to Melbourne, i still see a mix of places selling in my area (st kilda hill), one agent in particular is having a great run of sold at auction for solid prices, so hard to tell what it has really dropped

thanks

professor robots

 

[MACCA350]

Based on realestate.com.au, My suburb(13km from CBD) has seen a drop of about 23% in 12 months and a drop of 41% since it's peak 6 months ago. Demand in the suburb has gradually dropped by almost 60% from a peak 12 months ago.

I've noticed prices dropping and properties increasing in my area. Although not the norm, a property on our street has been on the market for about 2 years and they've dropped their asking price by around 25% in the last year. Looking at listings I'd say the average drop in the area has been around 20-30% in the last year.

I'd say some areas have already hit the breaks and some who need to get out have missed their chance to preserve capital.

Cheers

 

[ferretbiter]

You find a property for 240-320k with a rental return of $350-$500. In St Kilda on the weekend my mate sold an apartment for $505k that was returning $370 a week gross and about $298 net. Different state I know but maybe the VIC bubble is bigger than elsewhere, hypothetically speaking of course

Hoping a house will return more in this current market because young families are willing to pay big bucks for a place because of the lack of rental opportunities.

Im not sure you understand what fixed interest is. The highest fixed interest rate for cash deposits is just over 6%

7, 8, 9, or 10% ?? Not available for fixed interest rate on cash deposits. Some managed/index funds may have achieved this in the past but that is no guarantee for the future.

Yep definitely got mixed up, was thinking of a mutual fund.Currently getting 7.2% returns from a mutual fund at the moment.

 

[ferretbiter]

Based on realestate.com.au, My suburb(13km from CBD) has seen a drop of about 23% in 12 months and a drop of 41% since it's peak 6 months ago. Demand in the suburb has gradually dropped by almost 60% from a peak 12 months ago.

I've noticed prices dropping and properties increasing in my area. Although not the norm, a property on our street has been on the market for about 2 years and they've dropped their asking price by around 25% in the last year. Looking at listings I'd say the average drop in the area has been around 20-30% in the last year.

I'd say some areas have already hit the breaks and some who need to get out have missed their chance to preserve capital.

Cheers

So it would be a great time to buy right now in your opinion?

 

[cutz]

i dont want media/guvvy stats/abs etc etc ...... just what you see in YOUR areas

Bit difficult to gauge lately,

My neck of the woods (inner melbourne) I'm seeing properties getting passed in at auction then relisted as private sale, then taken off the market. Some properties that were passed in at auction then sold via negotiation to the highest bidder, normally when I check the results on these the price is undisclosed.

Observations only, attending auctions in around my street for a pure sticky beak, hopefully things turn out OK when the dust settles.

 

[nukz]

one agent in particular is having a great run of sold at auction for solid prices, so hard to tell what it has really dropped

A real-estate agent? lol

Anyway as far as the above question, i sold some places in CBD early last year i personally see a repeat of 2000 when docklands/CBD experienced falls due to over-building of apartments. Right now in Melbourne CBD there are so many developments...

but only time will tell.

 

[banco]

I thought this was kind of interesting given his role in pushing property over the years. From Mark Bouris's latest article on the business spectator site:

"Consider a typical couple from this cohort earning a total of $150,000 per annum, with the husband bringing in $125,000 of full-time pay and the wife making $25,000 part-time. They have a joint mortgage of, say, $750,000 and their lifestyle expenses rise by around 5 per cent per annum. Before the GFC, this family would have about $264 a week in surplus after paying their mortgage and average household expenditure. After the GFC, and allowing for a spate of official interest rate rises and bank top-ups, that figure drops to just $116 per week."

If you are earning $150,000 seems like a really bad idea to take out a 750000 loan.

 

[Caveman]

In Las Vegas the building boom is on again yep true sad part is no one whats to own a house in a ghost town or some thing that has been vacant for yrs so they are going for new...how stupid can people be.

And soon it will be here in a burb near you.
Sell now IF you can find a buyer

Are you a tent seller or something?
If I sell my home where am I going to live

 

[andy0]

I thought this was kind of interesting given his role in pushing property over the years. From Mark Bouris's latest article on the business spectator site:

"Consider a typical couple from this cohort earning a total of $150,000 per annum, with the husband bringing in $125,000 of full-time pay and the wife making $25,000 part-time. They have a joint mortgage of, say, $750,000 and their lifestyle expenses rise by around 5 per cent per annum. Before the GFC, this family would have about $264 a week in surplus after paying their mortgage and average household expenditure. After the GFC, and allowing for a spate of official interest rate rises and bank top-ups, that figure drops to just $116 per week."

If you are earning $150,000 seems like a really bad idea to take out a 750000 loan.

bouris pushes the panic button

 

[Agentm]

HOUSING approvals have collapsed to a 10-year low, falling 12 per cent between December and March and sliding 9 per cent in Victoria.

Read more: http://www.theage.com.au/business/housing-starts-up-in-smoke-20110516-1epva.html#ixzz1MYYi3tqc


i think the bubble is still valid, and as robots tells, the inner suburbs are maintaining a strong argument to sustain the bubble some more.. we have to thank the governments desire to keep it happening and god bless them hey!!

there are real estate agents now running auctions in english again in some inner city regions. but the demand for new housing has crunched to a halt, that part is being marketed as an export market into asia

so its all about outbidding and fighting hard to keep values high as no one wants their property values to shrink (and by property we are talking land value not dwelling costs)

the liberal government in victoria is looking at opening up vast tracts of land to export into asia as house and land packages, that will keep the failing housing sector from total collapse..

fingers crossed, we have to hope the Chinese and asian neighbours have an infinite thirst for outer melbourne house and land packages..

but imho the balances in place are just managing to keep the bubble sustained, and in the inner suburbs its peaked and flatlining at the peak.. but with a little bit of hocus pocus the RE industry will conjure up some nice numbers to make it all enticing

how long the fantasy will last is the question..

Two upcoming property debates

by Steve Keen on May 13th, 2011 at 6:52 pm Posted In: Debtwatch

Surprise surprise–now that house prices are falling, whether they are going to continue falling has become the topic du jour. I have been asked to take part in two debates on this–one an online Webinar organized by Business Spectator, the other a live lunchtime talk in Sydney organised by The Money Institute.
I’d enjoy having some Debtwatch readers involved in them both, so if you can make the webinar, or attend the debate, please do. Details are below (excerpted from the promotional materials).
Webinar: Where to for Australian house prices in the next 12 months?

When: Thursday, May 19, 2011 at 12pm AEST
(which is 10am for WA, 11:30am for NT, 12pm for QLD and 11:30am for SA)
Duration: 45 mins
REGISTER NOW
Australian house prices are ‘the highest in the world’ says the IMF, but is it true? We have recently seen some softening of residential house prices, especially in Victoria, but there are also signs of weakness in other regions, particularly those which are not directly linked to the mining boom.
Is it the reckoning the bears have been waiting for, or simply a soft patch in a wider acceleration that will continue thanks to a rising population, a shortage of housing stock and the powerful long term effects of negative gearing.
Business Spectator has gained a reputation as one of the prime debating arenas over house prices in the Australian media. Join Managing Editor James Kirby, economist Steve Keen and HIA’s Harley Dale to hear what lies in store for the next 12 months.
REGISTER NOW!
Don’t forget, this avenue is a great way to have your questions answered in real time – you can submit them during the webinar via a panel on the screen.
Be quick to register as there are a limited number of places available.
We hope you attend and we look forward to answering your questions!
Best Wishes
The Business Spectator Team
Will the Australian Property Market Crash?

Brought to you by The Money Institute & Live Debt Free Australia
Proudly brought to you by: www.livedebtfree.com.au and www.moneyinstitute.com.au The Great Property Debate – Panel Comments


Rising mortgage debt caused the house price bubble; now that debt has peaked, the same force that drove house prices up will drag them down
Professor Steve Keen, University of Western Sydney & Debt Watch

Many of the tell tale signs of a bubble are not present and just because house prices are overvalued doesn’t guarantee a bust
Shane Oliver, Chief Economist, AMP Capital Markets

Australian housing is a giant Ponzi scheme inflated by an unsustainable credit-fuelled boom. The bust has already begun and is unstoppable
Kris Sayce, Editor & Chief- Money Morning Publication

‘House price crash talk isn’t new and it continues to be more successful than any other topic in generating sensational headlines that scare the living daylights out of people. There are many challenges facing the Australian residential sector, including the need to aid entry level buyers and rental households. The focus should be on what needs to be done to alleviate upward pressure on dwelling prices
Harley Dale- Chief Economist, Housing Industry Association


Big differences of opinion by the leading experts. So come and hear both sides on the debate onan issue that affects every Australian with an interest in property & make up your own mind.
When: 7th June, 2011 from: 11.30 Registration for 12pm start to 2.00pm
Where: Wesley Centre, 220 Pitt St, Sydney. Info Hotline: 02 8004 2444
Register online: (limited seats available) click on link below to go registration page:
http://live-debt-free.com.au/money-...1/06/07/41/-/propertybubble-crash-debate.html
The Debate Panel

• Harley Dale- Chief Economist- Housing Industry Association (HIA),
• Shane Oliver- Chief Economist-AMP Capital Markets,
• Amanda Lynch, CEO of the Real Estate Institute
• Professor Steve Keen- Associate Professor-University of Western Sydney N.S.W
• Kris Sayce-Editor & Chief-Money Morning Publication
• David Collyer- Manager Director-Prosper Organisation

​

 

[greebly24]

I thought this was kind of interesting given his role in pushing property over the years. From Mark Bouris's latest article on the business spectator site:

"Consider a typical couple from this cohort earning a total of $150,000 per annum, with the husband bringing in $125,000 of full-time pay and the wife making $25,000 part-time. They have a joint mortgage of, say, $750,000 and their lifestyle expenses rise by around 5 per cent per annum. Before the GFC, this family would have about $264 a week in surplus after paying their mortgage and average household expenditure. After the GFC, and allowing for a spate of official interest rate rises and bank top-ups, that figure drops to just $116 per week."

If you are earning $150,000 seems like a really bad idea to take out a 750000 loan.

Cheers banco. I found this hilarious. A combined income of $150k and they're left with $13,728 per year (or only $6,000 after the GFC). Ridiculous! How much of that do you reckon they'll be able to save for a rainy day? And what if the wife loses her job or a kid gets sick and needs looking after or even if one of their cars breaks down? Probably see a "vendor must sell" real estate ad shortly thereafter. No wonder Westpac is seeing an increase in late loan repayments. Who lent to this much to this couple anyway?

Using an over-extended couple like this to validate the author's argument is ludicrous.

 

[Plumber1]

Bit difficult to gauge lately,

My neck of the woods (inner melbourne) I'm seeing properties getting passed in at auction then relisted as private sale, then taken off the market. Some properties that were passed in at auction then sold via negotiation to the highest bidder, normally when I check the results on these the price is undisclosed.

.

Join up FREE with www.onthehouse.com.au and all prices are disclosed. The information all comes from the Titles Office. It shows history of sales for every house in Australia.
It is excellent.

 

[nunthewiser]

nice site plumber

cheers

gday robots, hope all is well in sunny paradise

thanks to those that left comments in regards to my querie

 

[Knobby22]

Join up FREE with www.onthehouse.com.au and all prices are disclosed. The information all comes from the Titles Office. It shows history of sales for every house in Australia.
It is excellent.

Yes, thanks Plumber, I need this site. So many are undisclosed at the moment.

 

[Taltan]

Join up FREE with www.onthehouse.com.au and all prices are disclosed. The information all comes from the Titles Office. It shows history of sales for every house in Australia.
It is excellent.

Unfortunately per the website the info comes from the titles offices in QLD, NSW, SA, WA and ACT. Looks like the SRO (VIC) ain't playing ball, maybe that's why our bubble is bubbling along better than some of the others.