The future of Australian property prices

[Julia]

I wonder how it will be viewed in 5 years time, those of us who have gone defensive with cash and no gearing...

No idea, but I've been very thankful I went to cash at the start of the GFC and am again 100% in cash at present.

 

[MrBurns]

No idea, but I've been very thankful I went to cash at the start of the GFC and am again 100% in cash at present.

Me too and I'm staying that way I have a bad feeling about whats happening now.

 

[medicowallet]

No idea, but I've been very thankful I went to cash at the start of the GFC and am again 100% in cash at present.

I wish I was 100% ATM but, I am mostly cash, but some assets, such as ones I purchased for much less back in the day, I am holding, as transaction costs just seem like a pain.

Still, I won't suffer much at all with a fall, as I have no borrowings atm, and will likely pick some things up when it looks like it might settle down, be that 10 years or more, nobody knows I suppose

 

[Glen48]

and will likely pick some things up when it looks like it might settle down, be that 10 years or more, nobody knows I suppose

What if things get so bad you can pick up say a Sydney hotel for say 100k would you buy it, if you paid 100k at auction then that is what it is worth, if sale are weak and you would still be forced to pay all outgoings and fees etc with limited income it shows no body knows what some thing is worth in a depression and just as hard to make a decision as in good times.
During the German post war economy you could buy a city block with a gold coin.
Trying to pick the bottom of the market is as hard as the top,no doubt buying some thing like that at that price sounds like a good buy but is it????
Given a few more year it could be worth less.
All we can do is look back at history and try to judge when to pounce.
I go by 5 yrs after what ever happens in USA.

 

[numbercruncher]

Is this the anAtomy of a Chinese housing bust ? Shows that even controlling communist Governments cant sustain the unsustainable ....

Peek into Oz RE's near future ?

Year-on-year sales in Q1, for all real estate, was down 14.6%.
Residential property sales were down 17.5%
Office sales were down -10.2%*
Sales in January-February were a disaster, falling 20.9% overall, compared to the first two months of 2011, -24.7% for residential.
Total amount of floor space “for sale” was up 35.5%, compared to the same date last year
Floor space of residential units “for sale” grew 47.4%.
At the end of 2011, total floor space “under construction” was roughly 4.6 times the floor space sold
A year and a half worth of excess inventory is hidden somewhere in the pipeline
New starts in April fell 14.6% year-on-year and 27.0% month-on-month, for property as a whole
Housing starts fell -14.4% year-on-year and -23.4% month-on-month
Office starts fell -21.0% year-on-year in April, and -45.1% compared to March
Retail property starts fell -18.7% year-on-year, and -36.8% compared to March
Land sale revenues in April (RMB 27 billion) were down -54.7% compared to April last year
Foreign funding for property development was down -91.4% in March and -80.8% in April, compared to the same months last year.


Read more: http://www.businessinsider.com/real-estate-crash-in-china-2012-5#ixzz1vFsQmR8j

 

[medicowallet]

"
Latest Sales
Saturday 19th May 2012

A clearance rate of 61 per cent was recorded today compared to 60 per cent last weekend and 56 per cent this weekend last year.

The falls recorded in the stock market during the week serve as a reminder that when considering investment strategies it is sensible to include property as part of a portfolio as it does not display the volatility of shares"


Well done Enzo, perhaps you should do a comparison of the average person's returns of their super fund for 2012 vs their property performance for Melbourne in the same timeframe.

Also, the argument that house prices have less volatility is quite flawed, and in fact, on a day to day basis, I would guestimate that a house would show wild volatility compared to shares, as there has to be an available purchaser on that particular day.

Just because a person is unaware that their house went down in value 5% on a particular day, does not mean it did not lol.

If shares showed as much volatility as the REIV's proposed vs reported # of auctions per week, then that would be something!!

 

[satanoperca]

Hold on sunshine, 508 auctions with 311 = 61% whoppy do da do.

How about those Auctions with no result: 57, more than 10% goes unreported.

Auction results need to be taken as just part of the picture.

I went to three today myself, apparently it is a buyers markets, all inner city Melbourne. Seems they forgot to tell the buyers, at two there would have been less than 10 people and most of them neighbours with both being passed in on vendor bids. The third had 5 people standing around, I was the second highest bid, just out bid by the vendor by several hundred thousand. Oh well may day will come.

Good luck to those selling and if buying, you will need more than good luck.

 

[im sparticus]

volatility?? Shares in australia as a whole are currently 40+% off their gfc highs. Cant see the medians ever achieving half of this. Anywhoo if your any good at maths and i personally dont think you are you can work out the past volatility of the index and compare it to the medians and report back on your findings.

 

[young-gun]

volatility?? Shares in australia as a whole are currently 40+% off their gfc highs. Cant see the medians ever achieving half of this. Anywhoo if your any good at maths and i personally dont think you are you can work out the past volatility of the index and compare it to the medians and report back on your findings.

im backing hes better at maths than you are at spelling, spartacus.

you are absolutely kidding yourself if you think house prices can't fall 20% from peak. theyve already proven to have fallen 10%(adjusted for inflation though) from peak. are you ruling out another 10-15% fall?

 

[Glen48]

Wonder if asparagus is Robots behind a cheap mask???
Born again denier.

 

[im sparticus]

im backing hes better at maths than you are at spelling, spartacus.

you are absolutely kidding yourself if you think house prices can't fall 20% from peak. theyve already proven to have fallen 10%(adjusted for inflation though) from peak. are you ruling out another 10-15% fall?

Heresay vs whats actually happened calculate current vol of both and report back when proerty is higher until then what has been said is not true.

Some suggested reading for young-gun and co "the fox and the grapes"

 

[young-gun]

Some suggested reading for young-gun and co "the fox and the grapes"

lol. do you actually understand the story, and the meaning behind it? perhaps you should read over it again, then look in the mirror.

 

[young-gun]

Heresay vs whats actually happened calculate current vol of both and report back when proerty is higher until then what has been said is not true.

i'm also not arguing that there is more volatility in property than shares either.

 

[Glen48]

If you have a good memory for faces you don't need a mirror.

 

[Julia]

you are absolutely kidding yourself if you think house prices can't fall 20% from peak. theyve already proven to have fallen 10%(adjusted for inflation though) from peak. are you ruling out another 10-15% fall?

It's not going to be uniform across the country.
Selling prices in my area (regional coastal SEQ) are down as much as 20 - 25% on two to three years ago.

 

[Glen48]

Wrong you for got to add in the 7% you are paying in IR plus extra's.
This can't be good.
One day the penny will drop and panic will set in.

 

[Starcraftmazter]

Some suggested reading for young-gun and co "the fox and the grapes"

Do you understand how the banking system works yet?

 

[im sparticus]

Do you understand how the banking system works yet?

Do you understand why the grapes are sour?

 

[Glen48]

This can't be good:
From Money morning.


he China Daily newspaper ran an article on Friday reporting that, 'China's big four banks made almost no new loans in the first half of May.'

China's big four are Industrial and Commercial Bank of China [HKG: 1398], China Construction Bank [HKG: 0939], Bank of China [HKG: 3988], and Agricultural Bank of China [HKG: 1288].

Chinese lenders were already slowing down their lending. In April it fell to 681 billion, from 1001 billion yuan in March.

But still - zero new lending from 'China's big four' in the first half of May comes as a shock

Last weekend's Chinese financial data fits the same picture. These showed China's imports grew at just 0.3% in April.

China's real estate is also hitting the skids. Residential construction growth has fallen from 16% to 4% in a year.

And it's not selling either: sales are down 17.5%, and there is now 47.4% more residential floor space for sale than a year ago. Land sales are down 55% compared to last year.

This is hitting China's growth rate hard as real estate investment makes up 13% of the GDP figure.

The evidence is mounting before your eyes that China is stalling.

 

[im sparticus]

im backing hes better at maths than you are at spelling, spartacus.

you are absolutely kidding yourself if you think house prices can't fall 20% from peak. theyve already proven to have fallen 10%(adjusted for inflation though) from peak. are you ruling out another 10-15% fall?

Spartacus was already taken so was tricky dicky