numbercruncher
Beware of Dropbears
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sparticus - do you know Robots personally?.
The future of Australian property prices
- Thread starter Joe Blow
- Start date
numbercruncher
Beware of Dropbears
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You only need a 50pc mortgage on recent prices for that to actually be a 100 plus percent mortgage on new revised "crashed" prices ....
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50% go fish your not even close. but ide like to see your math number are you quoting aussie medians on there peak @ 50%lvr or some appartment in the circle on cavil building?
numbercruncher
Beware of Dropbears
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Actually I didnt even need to use the 50pc thing as an extreme example - just look at how many people have lost on paper their entire deposit and now sit in massive negative equity after making pathetic leveraged bets on Australian Realestate .....
http://www.propertyobserver.com.au/mortgages/number-of-homes-in-negative-equity-rising-particularly-for-recent-buyers-rp-data
I highlight the Gold Coast as I live there - the very place I live in has dropped 20pc of its " value " in just the past 6 months and its only going to get alot worse for property speculators.
http://www.propertyobserver.com.au/mortgages/number-of-homes-in-negative-equity-rising-particularly-for-recent-buyers-rp-data
I highlight the Gold Coast as I live there - the very place I live in has dropped 20pc of its " value " in just the past 6 months and its only going to get alot worse for property speculators.
tech/a
No Ordinary Duck
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Prices are 20% down from peak here.
I'm in the process of selling all longterm holdings. Keeping all industrial stock.
Development is where the opportunity is currently.
Holding property even if it's positively geared is. In my opinion not the best use of opportunities (in property) at this time. ( in the domestic market ).
Development property stock is really cheap.
Project builders will fall over themselves with deals to get your business.
Building times are the fastest I've seen in years.
Do the numbers right and select the right property for development and you'll sell off plan BEFORE
you start your build.
Sound easy--- well it's not that hard!
I'm in the process of selling all longterm holdings. Keeping all industrial stock.
Development is where the opportunity is currently.
Holding property even if it's positively geared is. In my opinion not the best use of opportunities (in property) at this time. ( in the domestic market ).
Development property stock is really cheap.
Project builders will fall over themselves with deals to get your business.
Building times are the fastest I've seen in years.
Do the numbers right and select the right property for development and you'll sell off plan BEFORE
you start your build.
Sound easy--- well it's not that hard!
Julia
In Memoriam
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20 - 25% down here, SE coastal regional Qld.
The oft quoted 6% or 7% down in media reports are very misleading imo.
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numbercruncher
Beware of Dropbears
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Look how he changes his tune from just a month or two ago
Good to see a realistic Businessman positioning himself according to market conditions actually - but yes it is a big change on the techs posts of the past
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Good to see a realistic Businessman positioning himself according to market conditions actually - but yes it is a big change on the techs posts of the past
I guess that makes me a much better businessman, considering I would have sold long ago at the peak - without losing any money.
tech/a
No Ordinary Duck
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Good to see a realistic Businessman positioning himself according to market conditions actually - but yes it is a big change on the techs posts of the past
It's reality.
Been advocating development for a few years now.
Difference now is the opportunity is even more apparent.
Demand at the right price is still excellent.
Price a property at market pricing and you'll sell it.
Over price it and you'll sit in the queue.
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Are you serious!
You have been bearish on property for 20 years (since before you could speak) you never would have baught and misses all previous gains. your only angle on increasing worth is through bullion. whats more is i bet you have never engaged in anything that even remotely resembles bussiness activity.
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There's something about those two things side by side which is wholesomely funny
Don't even need to rebut you when you post crap like that.
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There's something about those two things side by side which is wholesomely funny
Don't even need to rebut you when you post crap like that.
The only person that finds that funny (ie what your implying, not the fact your bear buddies are still laughing at you behind your back on that one) is you.
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numbercruncher
Beware of Dropbears
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I know you would of SCM - shame there wasnt a raw vehicle to short Aussie realestate at the peak of this popping bubble.
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It would have been good. Not sure how it would work, plenty of bulls though - maybe just let the bulls and bears bet against each other through CFDs or something to that extent, they could save the cost of useless stamp duties and RE fees, and we could simply take their money straight off their hands
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I know everyone says it's horrible to laugh or gloat when the prices collapse, but no offense, a whole group of people have driven up prices in an asset class that everybody needs. If somebody cornered the oil market, or the clothing, or food market, and sold it to everyone else at sky high prices, people would be pissed, yet when property goes up, it's considered "good economic news" .. Um, how exactly?
I just find it so sad that in Australia the only (perceived) road to riches by middle class morons is: Step 1. Buy house. Step 2. Extort people with high rent Step 3. Sell house for even more, locking up large amounts of money by all parties
How about:
Step 1. Create, refine, deliver something that the market wants, you know? A product, or a service?
Step 2. Deliver it on a huge scale, rake in profits, grow the standard of living of the entire country and create jobs
It's a total fail, and as a younger potential home owner, I refuse to buy/commit to any debt at this point, I don't care what the RBA does. It's going to hit the fan when all the domino's knock over. There's too many things set to blow up this decade - especially USA and their fiscal crisis, that's the biggest elephant in the room and is going to be in the headlines in the next 3-5 years, it's effects are going to be worse than Europe when their rates rise and they have to meet their obligations (they have committed over 400% of GDP if you account for all their unfunded liabilities) - they're stuffed.
So instead of having an economy where we've created, built products, become more efficient and affluent, all we'll be left with are: a) too many houses b) povo people defaulting c) high unemployment.
Oh, and the share market will tank in sympathy with the USA share market at that point, we have better fundamentals but whatever happens in the USA happens here. I would be waiting on the sidelines and getting your superannuation out right now, these boomers cannot afford to wait another 20 years for it to come back, you'll be dead then! Oh well, I guess you can just sell all your homes back to the generation you've been screwing, at a reduced price because you'll be desperate at that point!
I just find it so sad that in Australia the only (perceived) road to riches by middle class morons is: Step 1. Buy house. Step 2. Extort people with high rent Step 3. Sell house for even more, locking up large amounts of money by all parties
How about:
Step 1. Create, refine, deliver something that the market wants, you know? A product, or a service?
Step 2. Deliver it on a huge scale, rake in profits, grow the standard of living of the entire country and create jobs
It's a total fail, and as a younger potential home owner, I refuse to buy/commit to any debt at this point, I don't care what the RBA does. It's going to hit the fan when all the domino's knock over. There's too many things set to blow up this decade - especially USA and their fiscal crisis, that's the biggest elephant in the room and is going to be in the headlines in the next 3-5 years, it's effects are going to be worse than Europe when their rates rise and they have to meet their obligations (they have committed over 400% of GDP if you account for all their unfunded liabilities) - they're stuffed.
So instead of having an economy where we've created, built products, become more efficient and affluent, all we'll be left with are: a) too many houses b) povo people defaulting c) high unemployment.
Oh, and the share market will tank in sympathy with the USA share market at that point, we have better fundamentals but whatever happens in the USA happens here. I would be waiting on the sidelines and getting your superannuation out right now, these boomers cannot afford to wait another 20 years for it to come back, you'll be dead then! Oh well, I guess you can just sell all your homes back to the generation you've been screwing, at a reduced price because you'll be desperate at that point!
Glen48
Money can't buy Poverty
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So true but don't worry the Feds are on to it:
The longer this bail out lurk goes on the worse it will get and longer to settle.
The longer this bail out lurk goes on the worse it will get and longer to settle.
Spain has become the fourth and largest country to ask Europe to rescue its failing banks, a bailout of up to 100 billion euros ($A127.76 billion) that leaders hope will stabilise a financial crisis that threatens to break apart the 17-country eurozone.
he rescue offer follows growing pressure from international investors and the Obama administration and comes a week before elections in Greece, whose voters could decide whether the country leaves the euro.
Europe's widening recession and financial crisis has hurt companies and investors around the world. Providing a financial lifeline to Spanish banks is likely to relieve anxiety on the Spanish economy - which is five times larger than Greece's - and on markets concerned about the country's ability to pay its way.
"What the markets are looking for is essentially the Spanish government's acceptance that its banks are broke," said Jacob Kirkegaard, a research fellow at the Peterson Institute for International Economics in Washington.
Economy Minister Luis de Guindos announced the deal after an emergency conference call with eurozone financial leaders.
He said the aid will go to the banking sector only and would not come with new austerity conditions attached for the economy in general - conditions that have been an integral part of previous bailouts to Portugal, Ireland and Greece.
The exact figure of the bailout has not yet been decided. De Guindos said the country is waiting until independent audits of the country's banking sector have been carried out before asking for a specific amount. The audits are expected June 21 at the latest.
De Guindos did say, however, that Spain would request enough money for recapitalisation, plus a safety margin that will be "significant".
With markets in turmoil, de Guindos said the government's efforts to shore up the financial sector "must be completed with the necessary resources to finance the needs of recapitalisation".
Finance ministers of the 17 countries that use the euro said the money would be fed directly into a fund Spain set up to recapitalise its banks, but underscored that the Spanish government is ultimately responsible for the loan.
Still, that plan allows Spain to avoid making the onerous commitments that Greece, Ireland and Portugal were forced to when they sought their rescues.
Instead, the eurogroup statement said that it expected Spain's banking sector to implement reforms and that Spain would be held to its previous commitments to reform its labour market and manage its deficit.
That meant the cost could reach 100 billion euros.
The Spanish acceptance of aid for its banks is a big embarrassment for Prime Minister Mariano Rajoy, who insisted just 10 days ago that the banking sector would not need a bailout. He was elected in November and walked right into a hurricane.
International pressure on Spain to solve its financial problems has grown more urgent in recent weeks.
On Thursday ratings agency Fitch hit Spain with a three-notch downgrade of its credit rating. That left it two levels above junk status. Then on Friday, Moody's Investor Services warned it could downgrade Spain and other countries in the eurozone.
The International Monetary Fund on Saturday released a report estimating that Spanish banks need a recapitalisation injection of at least 40 billion euros following a stress test it performed on the country's financial sector.
That report came out three days ahead of schedule, underscoring the urgency of the situation.
And US President Barack Obama, facing re-election, enduring a weak economy and in need of strong trading partners, expressed strong concern late Friday over the European economic crisis
he rescue offer follows growing pressure from international investors and the Obama administration and comes a week before elections in Greece, whose voters could decide whether the country leaves the euro.
Europe's widening recession and financial crisis has hurt companies and investors around the world. Providing a financial lifeline to Spanish banks is likely to relieve anxiety on the Spanish economy - which is five times larger than Greece's - and on markets concerned about the country's ability to pay its way.
"What the markets are looking for is essentially the Spanish government's acceptance that its banks are broke," said Jacob Kirkegaard, a research fellow at the Peterson Institute for International Economics in Washington.
Economy Minister Luis de Guindos announced the deal after an emergency conference call with eurozone financial leaders.
He said the aid will go to the banking sector only and would not come with new austerity conditions attached for the economy in general - conditions that have been an integral part of previous bailouts to Portugal, Ireland and Greece.
The exact figure of the bailout has not yet been decided. De Guindos said the country is waiting until independent audits of the country's banking sector have been carried out before asking for a specific amount. The audits are expected June 21 at the latest.
De Guindos did say, however, that Spain would request enough money for recapitalisation, plus a safety margin that will be "significant".
With markets in turmoil, de Guindos said the government's efforts to shore up the financial sector "must be completed with the necessary resources to finance the needs of recapitalisation".
Finance ministers of the 17 countries that use the euro said the money would be fed directly into a fund Spain set up to recapitalise its banks, but underscored that the Spanish government is ultimately responsible for the loan.
Still, that plan allows Spain to avoid making the onerous commitments that Greece, Ireland and Portugal were forced to when they sought their rescues.
Instead, the eurogroup statement said that it expected Spain's banking sector to implement reforms and that Spain would be held to its previous commitments to reform its labour market and manage its deficit.
That meant the cost could reach 100 billion euros.
The Spanish acceptance of aid for its banks is a big embarrassment for Prime Minister Mariano Rajoy, who insisted just 10 days ago that the banking sector would not need a bailout. He was elected in November and walked right into a hurricane.
International pressure on Spain to solve its financial problems has grown more urgent in recent weeks.
On Thursday ratings agency Fitch hit Spain with a three-notch downgrade of its credit rating. That left it two levels above junk status. Then on Friday, Moody's Investor Services warned it could downgrade Spain and other countries in the eurozone.
The International Monetary Fund on Saturday released a report estimating that Spanish banks need a recapitalisation injection of at least 40 billion euros following a stress test it performed on the country's financial sector.
That report came out three days ahead of schedule, underscoring the urgency of the situation.
And US President Barack Obama, facing re-election, enduring a weak economy and in need of strong trading partners, expressed strong concern late Friday over the European economic crisis
My "little" theory understands that price moves at the margin and that the margin is highly leveraged. What is 'owned' outright is of no concern, the cash buyers mostly come from cash sales that have bought and sold on the same market, they are not the drivers of price so much as the more sensitive margined buyers and owners. Until you almost completely eliminate them they will have a disproportionate impact on price. Consider how a stock moves on the pain of the minority of margined holders if you can't get your head around housing... it is not different in housing, in a down turn the weakest hands determine the top and direction... at the bottom the opposite is true, the strongest hands put the bottom in.
I understand just how leveraged Aus property is, again you need to understand how markets really work and get past how you think they work.
Price can fall in real or nominal terms, in an aggressive inflation they will fall until the excess debt is adsorbed then they will lag most other assets due to the financing pressures on families struggling to keep pace with the cost of living. During this period they move forward in nominal terms but not in real terms. It is RE history... not some theory, if you don't understand this dynamic you need to ask yourself are you qualified to invest your own money in property? Look at stagflations and see what happens.
Wouldn't you have been better arguing that we are not stagnating given 4.3% growth?
Keep em coming this is fun... especially the condescension, I thrive on it!
LOL, yes... I love the way an entire nation of property owners became master investors of a few short years! Inflation gets into stocks and property and all of a sudden we are geniuses, monetary phenomena be damned! As soon as the same dynamic hits commodities like oil it is those damn speculators! Dats politics for you!
