The future of Australian property prices

[Dowdy]

Wont be too far away Doc. ECB better buy them bonds tonight to prop up the Italians and Spaniards or we are in a world of pain. Crisis what crisis?

Australia wont be able to buy it's way out of this one. If the Gillard Guvmint tries it will be throwing itself over the financial cliff once commodity prices begin to slip as China gets the speed wobbles.

SOOOOOOO we are looking at a very interesting week. Make or break time. For the markets that is.

Where does that leave us on the property prices? Business as usual. Slowly does it.

You answered your own question in that post. Australia wont be able to buy it's way out of this one. If the Gillard Guvmint tries it will be throwing itself over the financial cliff once commodity prices begin to slip as China gets the speed wobbles.

No more propping up of the housing industry. No more hand outs. No more easy credit from the banks.

Fun times if you're cashed up and own a boat load of silver - bring it on

 

[trainspotter]

You answered your own question in that post. Australia wont be able to buy it's way out of this one. If the Gillard Guvmint tries it will be throwing itself over the financial cliff once commodity prices begin to slip as China gets the speed wobbles.

No more propping up of the housing industry. No more hand outs. No more easy credit from the banks.

Fun times if you're cashed up and own a boat load of silver - bring it on

Ermmmmmmmm you are a bit late Dowdy. There will be no more handouts to FHB or to the housing industry. Credit Squeeze happened 2 years ago and banks have already tightened their lending criteria. That's what we have been discussing for quite some time now

I was talking about a STIMULUS PACKAGE similar to the $900 x 3 handouts and the Pink Batts and the BER buying their way out of trouble palava that was totally unnessecary. They will not be able to afford it this time around if China does not by our minerals or commodity prices fall as the mining companies will lay off staff causing unemployment to go up. THEN this may begin to causative effect a rapid increase in loan defaults.

Interest rates are set to fall dude. Only last week everyone was screaming they were gonna rise !! LOLOLOL. SO hence why I stated it will be business as usual in the HOUSING market. I also pointed out WHY OH WHY were the banks prepared to lend funds for 15 year FIXED period at 8.38% if the interest rates were going to rise???? HUH???

Fun times if your tenants have their rent paid 12 months in advance and your repayments are going down ! How big is your boat?

 

[Uncle Festivus]

Where does that leave us on the property prices? Business as usual. Slowly does it.

Property won't be the lone island of stability in the not too distant recession - that's why rates are going to fall - doesn't mean that house prices will stabilise or go up because rates are lower. All that's happening now is the approaching property train wreck (you would have spotted that already though?) is waiting patiently for it's turn as the asset class last to be sold off. And when it does, there won't be any liquidity like cash or shares, it will be just one horrible scramble for the exits.

Rents?? That's if you will still have tenants with jobs??

I still don't understand how a few of you permabulls can put forward the view of all that is wrong with the economy & how bad it's gonna get, but then in the next breath say that property will do fine?? There's not going to be a disconnection between a global recession and Australian property, and in fact it's going to several magnitudes worse here because of the loan practices of the likes of the big 4 etc who need to constantly tout for more resi loan business for short term gain.

All the bazookas have been fired - it's going to get ugly.

 

[trainspotter]

LOL Uncle Festivus. All you permabulls. SHUCKS I am honoured you think this way. Where did I say that property will be doing fine? Where were you when I wrote this?

RIGHT THEN ........ now we are getting somewhere. This could be the catalyst that I have been talking about. JOBS JOBS JOBS. If this happens then I can easily see a quickening slide on the 8 capital city average home price due to foreclosures.

Hey Uncle .... people have to live somewhere you know? They all just can't wander the streets aimlessly or sleep under bridges. This is why people rent houses.

As for interest rates going down means that the majority of people will still be able to pay the mortgage. Yes yes yes there will be the usual victims that overleveraged and will have to sell due to foreclosures. Ho hum. Happened before it will happen again.

Last week everyone was squawking the reason property was going to fall was that interest rates were going to go UP and people would not be able to afford the repayments along with all the costs of living going UP etc. Looks like it will be going down now. SHUCKS, now aint that a biatch.

Any liquidity like cash or shares. Hahahhaahaaa sell your shares?? Who is gonna buy them in this market Uncle? 40 billion wiped out in 2 days of ASX trading. Liquidate your cash into what exactly? Interest bearing accounts? LOL .... now that's a good one. To qualify as liquid, you must be able to sell the asset quickly without a loss of value.

I have repeatedly explained that property has fallen in CERTAIN areas as well as the risk involvement in trading in property.

But alas, alack it falls on deaf ears and mute eyes and stagnant brains.

I might join robots in the dark room and observe as the bears come down to feast on the carcass of what was once an enjoyable thread.

 

[medicowallet]

LOL Uncle Festivus. All you permabulls. SHUCKS I am honoured you think this way. Where did I say that property will be doing fine? Where were you when I wrote this?



Hey Uncle .... people have to live somewhere you know? They all just can't wander the streets aimlessly or sleep under bridges. This is why people rent houses.

As for interest rates going down means that the majority of people will still be able to pay the mortgage. Yes yes yes there will be the usual victims that overleveraged and will have to sell due to foreclosures. Ho hum. Happened before it will happen again.

Last week everyone was squawking the reason property was going to fall was that interest rates were going to go UP and people would not be able to afford the repayments along with all the costs of living going UP etc. Looks like it will be going down now. SHUCKS, now aint that a biatch.

Any liquidity like cash or shares. Hahahhaahaaa sell your shares?? Who is gonna buy them in this market Uncle? 40 billion wiped out in 2 days of ASX trading. Liquidate your cash into what exactly? Interest bearing accounts? LOL .... now that's a good one. To qualify as liquid, you must be able to sell the asset quickly without a loss of value.

I might join robots in the dark room and observe as the bears come down to feast on the carcass of what was once an enjoyable thread.

1. How can people charge high rents when people cannot afford them?

2. Liquidity does not depend upon maintenance of value.

3. Say hello to Mr Burns for me.

4. We have been "different" for so long, I wonder if this can continue. Any hiccup in China, will definitely crush the low confidence that the world is experiencing, bring it on and we will see how strong our housing market is... waiting in anticipation of the next 6 months.. might buy a property or 6. I have been patient so far, and, in reality it has only taken a couple of years of limited growth in property to get here, so I am looking forward to seeing any potential correction

 

[Aussiejeff]

<snip>I am looking forward to seeing any potential correction

Another day or two of Obama & Timmy blaming S&P for all their economic woes should do the trick nicely and steamroll the ASX in the process.

With millions of small-medium investors getting their immediate & future wealth crushed with no end in sight of the trainwreck unfolding, I wonder how many might start panic selling the only source of "real" wealth they have left - the family home - to keep afloat?

Could be a hectic few weeks ahead for listing agents!

 

[Uncle Festivus]

LOL Uncle Festivus. All you permabulls. SHUCKS I am honoured you think this way. Where did I say that property will be doing fine? Where were you when I wrote this?

I believe you said - "RIGHT THEN ........ now we are getting somewhere. This could be the catalyst that I have been talking about. JOBS JOBS JOBS. If this happens then I can easily see a quickening slide on the 8 capital city average home price due to foreclosures."

But then - "Where does that leave us on the property prices? Business as usual. Slowly does it."

What is your position exactly? Buying or selling?

Hey Uncle .... people have to live somewhere you know? They all just can't wander the streets aimlessly or sleep under bridges. This is why people rent houses.

So if one of your tenants loses their job and can't pay the rent, what are you going to do?? Let them stay there rent free?

Any liquidity like cash or shares. Hahahhaahaaa sell your shares?? Who is gonna buy them in this market Uncle? 40 billion wiped out in 2 days of ASX trading. Liquidate your cash into what exactly? Interest bearing accounts? LOL .... now that's a good one. To qualify as liquid, you must be able to sell the asset quickly without a loss of value.

As far as I know, none of the ASX200 shares have gone 'no bid' yet, which means anyone who wants to sell their shares, can. Can't say that for property.....

"Liquidate your cash into what exactly? Interest bearing accounts?

Well yes - I've been getting 6% at call, 'risk free' for over a year now.....

I have repeatedly explained that property has fallen in CERTAIN areas as well as the risk involvement in trading in property.

But alas, alack it falls on deaf ears and mute eyes and stagnant brains.

I might join robots in the dark room and observe as the bears come down to feast on the carcass of what was once an enjoyable thread.

No, Robots is having a Latte and riding the trams. He's been a bit quiet since buying his last IP at the peak back in March last year

There will be a lot of carcasses for the bears to feast on - unfortunately they were right after all.....

 

[Uncle Festivus]

Another day or two of Obama & Timmy blaming S&P for all their economic woes should do the trick nicely and steamroll the ASX in the process.

With millions of small-medium investors getting their immediate & future wealth crushed with no end in sight of the trainwreck unfolding, I wonder how many might start panic selling the only source of "real" wealth they have left - the family home - to keep afloat?

Could be a hectic few weeks ahead for listing agents!

No, we are different. Expect an announcement from Swanny of new "property price support mechanisms" though......can't have the market dictate prices after all?

PS you have been prolific lately AJ - winter hibernation over already??

 

[Aussiejeff]

No, we are different. Expect an announcement from Swanny of new "property price support mechanisms" though......can't have the market dictate prices after all?

PS you have been prolific lately AJ - winter hibernation over already??

Gr-r-r-o-w-w-wl! Me achy bones ARE a bit creaky of late! LOL

 

[Bigukraine]

Hey TS and other's,

Bit of noise around that S&P are going to review the rating system of our Aussie bank's

"DOWN" and that funding costs could rise by 0.3%......... and the banks wouldn't pass this on now would they........

That IR rise may still be on the table me thinks

 

[Dowdy]

Interest rate rise or not, who's going to buy a house in a falling market?

Investors ride on confidence and when there's none, there's no market.

AS for the stock exchange, it's been a bear market rally for 08-10, now it's just going back to the bear market trend. Nothing new if you saw it coming

 

[kincella]

cba just dropped rates on fixed home loans by 0.6%

on radio 2gb news just now...on 1-5 year fixed loans....
no rba drop last week, so cba taking control on rates.....
hohoho...the future of rates is down....not waiting for the rba to dither around, and over riding glen stevens bumbling nonsense

 

[trainspotter]

Last post peoples and then I am outta here.

I believe you said - "RIGHT THEN ........ now we are getting somewhere. This could be the catalyst that I have been talking about. JOBS JOBS JOBS. If this happens then I can easily see a quickening slide on the 8 capital city average home price due to foreclosures."

But then - "Where does that leave us on the property prices? Business as usual. Slowly does it."

What is your position exactly? Buying or selling?

Buying and selling ... is it not obvious? Have jobs gone DOWN yet? NOPE ..... so therefore it is business as usual. Until unemployment rises then the status quo will remain. Can you not comprehend what is being written? Another reason why I will be going bye byes and leaving the ignoramus's to feast upon.

So if one of your tenants loses their job and can't pay the rent, what are you going to do?? Let them stay there rent free?

What a stupid thing to write. Let blockheads read what blockheads wrote has never rung truer. I can't be bothered answering this inane question. You obviously have not been paying attention. This has been covered previously many times over.

As far as I know, none of the ASX200 shares have gone 'no bid' yet, which means anyone who wants to sell their shares, can. Can't say that for property.....

SELL THEM TO WHO ???? I don't see people breaking down the doors to get into the stock market. Quite the opposite in fact !

Well yes - I've been getting 6% at call, 'risk free' for over a year now.....

Once again you are not comprehendiong what has been written. Rates are set to fall so therefore your cash will be worthless as an investment tool as inflation is at 3.6% so you are making 2.4% on your money, take out the fees, charges etc and you may as well stick your cash up your mattress. Less than 1.5% on your money. SMART INVESTING !!

No, Robots is having a Latte and riding the trams. He's been a bit quiet since buying his last IP at the peak back in March last year

So you know this for a fact do you?? No wonder he does not post anymore.

There will be a lot of carcasses for the bears to feast on - unfortunately they were right after all.....

In your opinion. It has not happened.

100 BILLION or 7% WIPED OUT IN 72 HOURS WITH MORE TO COME compared to 2% OVER 12 MONTHS.

Hey Bigukraine ...... Such a downgrade could affect fiscal 2012 estimated cash earnings for the banks by potentially up to 6 or 7%. That would be spread over three to five years and could already be partly factored into bank funding costs as they raised rates above Reserve settings and blamed "cost of funding" LOL.

They are still offerring over a 10 year fixed term ...... wait for it ........ wait for it ..... 8.17%

http://www.anz.com/aus/RateFee/InterestRates/Rates.asp#Section100

Hey Dowdy ...... INVESTORS BUY IN A FALLING MARKET BECAUSE PEOPLE RENT THEM !! http://www.news.com.au/money/proper...-rents-skyrocket/story-e6frfmd0-1226107378085

People have to LIVE somewhere and they will pay RENT ......... In this situation you may see business's shut their doors so commercial property is on the cards to fall in price as well. Can't wait so I can buy some more.

Seeya peoples ... Have fun.

 

[againsthegrain]

Used light bulb business finally started to pay off?

 

[Dowdy]

Another reason why I will be going bye byes and leaving the ignoramus's to feast upon.

Oh yes, anyone who doesn't agree with you is an ignoramus.

SELL THEM TO WHO ???? I don't see people breaking down the doors to get into the stock market. Quite the opposite in fact !

Do you how the stock-market works? When someone puts a sell order, it has to be bought by someone to make it a trade and there is no shortage of that, is there? Unlike the RE market where you have houses on the market for a year....

So you know this for a fact do you?? No wonder he does not post anymore.

Don't you know, he's the great oracle of ASF. He just went into his 90 day meditation to reach enlightenment

100 BILLION or 7% WIPED OUT IN 72 HOURS WITH MORE TO COME compared to 2% OVER 12 MONTHS.

Let me ask you something, how many people have gone broke due to the stock market dropping 7%? What do you think would happen is the RE market dropped 7%. It's so over leveraged that some people are having trouble with a 2% drop

People have to LIVE somewhere and they will pay RENT ......... In this situation you may see business's shut their doors so commercial property is on the cards to fall in price as well. Can't wait so I can buy some more.

Seeya peoples ... Have fun.

Great, I'm waiting for commercial property to fall too!

Have fun. Not sure how life on this planet will continue once you're gone!

 

[prawn_86]

A little bit of calm and tolerance required from both sides of the fence please ladies and germs

 

[medicowallet]

cba just dropped rates on fixed home loans by 0.6%

on radio 2gb news just now...on 1-5 year fixed loans....
no rba drop last week, so cba taking control on rates.....
hohoho...the future of rates is down....not waiting for the rba to dither around, and over riding glen stevens bumbling nonsense

Have to make a market somehow. Must be a sign of people not buying houses or not borrowing to buy (obviously there is a difference), the latter suggests stagnant or falling prices.


Nice to see the stock market rise 6% in a few hours!!!! if you extrapolate that over a year... hang on...

Money printing in the US is bad news for us all. I would prefer to see some short term pain.

 

[cynic]

Last post peoples and then I am outta here.

Seeya peoples ... Have fun.

Nooooo!

Don't leave us now! Whatever would this thread be without you!

The financial heavens are falling!

We need your guidance more than ever right now!

How will we ever learn to navigate this newly discovered economic terrain without you?

T.S. , T.S. ! Why hast thou abandoned us!

 

[jbocker]

Hang in there TS, I hope you are only taking a short leave. I for 1 have greatly enjoyed your posts and hope that you remain.

Perhaps we all refresh our look at the first post on this thread; it is a passionate topic our property, and I am an avid supporter of investing in it - because mainly I am a crap stock investor - but still dabble.

Tis is a great debate - and I have learned much reading both views - even the most polarised.

 

[Starcraftmazter]

Just out of curiosity, is there an overall consensus here on whether we will have a crash (or whatever you want to call it) or not in the next few years?