wayneL
VIVA LA LIBERTAD, CARAJO!
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House prices to keep falling for years
- Thread starter Pommiegranite
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professor_frink
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if you re read the article, the agent requested them to drop the offer by 20K, it didn't say that they had an offer on it
Frinky (if I can call you that),
All I know is, if I was 50,000+GBP in debt with my unemployed husband on the verge of bankruptcy, my own weekly income of 500GBP a week not meeting nescessities or the leverage on my investment property...
If the agent called me up with any suggestion that would at least put me back in the black (realised or not), I would take it. They probably could have at least broken even on investment and equity (if not some extra for smaller debt) if they didn't behave so irrationaly and more important STUBBORNLY during this period.
Instead they held out until holding out any longer would be illegal, as is their right, fair enough, but they should not complain about the price when they exercised their right to remain in the house and refuse the bank the keys or reasonable sale they should accept the consequences (half of asking price).
All I know is, if I was 50,000+GBP in debt with my unemployed husband on the verge of bankruptcy, my own weekly income of 500GBP a week not meeting nescessities or the leverage on my investment property...
If the agent called me up with any suggestion that would at least put me back in the black (realised or not), I would take it. They probably could have at least broken even on investment and equity (if not some extra for smaller debt) if they didn't behave so irrationaly and more important STUBBORNLY during this period.
Instead they held out until holding out any longer would be illegal, as is their right, fair enough, but they should not complain about the price when they exercised their right to remain in the house and refuse the bank the keys or reasonable sale they should accept the consequences (half of asking price).
professor_frink
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all good sinner, you are right, they should have been trying to get rid of it for whatever they could get as quick as they could get it in those circumstances. You seemed to be making the earlier comment based on the assumption they had refused the offer, so I thought I'd point out it may have not been the case.
Cheers
rotflmao @ Waynes video.
"I should hold a sign saying idiot above my head" lmao.
On that couple, only got themselves to blame really.
Buying a BMW and a car for the son before the business had even started to repay the money used to buy it is a bit silly imo. Also how much due diligence was done on the business? Not much by the sounds of it. Just because the business is turning over 1.3mil a year doesn't mean it is actually making a cent in profit.
Leverage even on a so called "safe investment" like property can burn you when the :fan. Alot of people are over leveraged into property now due to drawing on the equity in their homes to fund lifestyles that they really can't maintain. I think we will see alot more of this type of thing happening in the near future.
"I should hold a sign saying idiot above my head" lmao.
On that couple, only got themselves to blame really.
Buying a BMW and a car for the son before the business had even started to repay the money used to buy it is a bit silly imo. Also how much due diligence was done on the business? Not much by the sounds of it. Just because the business is turning over 1.3mil a year doesn't mean it is actually making a cent in profit.
Leverage even on a so called "safe investment" like property can burn you when the :fan. Alot of people are over leveraged into property now due to drawing on the equity in their homes to fund lifestyles that they really can't maintain. I think we will see alot more of this type of thing happening in the near future.
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hahah nice video there Wayne.
I saw one for the drop of gold prices not long ago using the same movie scene. It was just as funny too!
Yep, it's definitely "different" here.
I saw one for the drop of gold prices not long ago using the same movie scene. It was just as funny too!
Yep, it's definitely "different" here.
man I couldn't stop laughing, that video was so well done..they capture all the jingles
did someone wish Hardly Normal going broke?
http://www.australianit.news.com.au/story/0,24897,24709404-5013040,00.html
http://www.australianit.news.com.au/story/0,24897,24709404-5013040,00.html
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Yeah, as the article indicates mainly for NEW HOME buyers.
It's the established homes sector that is wallowing. A year or two from now you can expect some of these very same NEW HOME buyers will be joining the burgeoning queues of "established homes for sale" - whether by choice or by default as interest rates inevitably climb back up.
It's all a bit messy.
All my friends and relatives in Perth say the same thing - the ESTABLISHED homes market has gone as flat as the Perth coastline, whereas some NEW homes and some NEW units are still selling. Not much good if you already own an established home (or two or more) and are wanting or needing to sell one (or both or more).
Good luck.
numbercruncher
Beware of Dropbears
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Might have somethign to do with the 50k properties the Gov is supporting via the affordable rental scheme, pretty good deal for an investor ..... Investors are dumping their old rundown ****boxes and upgrading to brand new government supported ones !
It works like this if you build a new IP house/unit that rents out for 300pw in the market, Instead you rent it out to lower/middle income earner for 240pw (20pc less) - the Fed Gov gives you 6k p/a and the state gov 2k p/a. Thats 160 p/w in Gov grants for 10 years - 400pw rental return instead of the 300!.....
Dont you love the amount of Cash the Gov pours into RE !
So this is robably a temporary spike time will tell ....
I agree.. as rates come down people who were waiting to jump in, will jump in, but who is going to come after that to continue the momentum? It's not going to happen without the economy booming again.
The market will get difficult in 2009 as people lose their jobs, and the lenders really tighten up in, as we have seen in UK, and now NZ. Those under 35 (FHB bracket) have only vague memory of recessions, and many will be caught off guard.
While the last recession ended in 1991, it wasn't until 1994 that the housing market, and in general conditions picked up again.
I don't see things going upwards in any sustained fashion at least until 2010, with any major rises not seen until 2012. Indicators such as ABS housing finance figures should be a fairly good indicator when recovery has begun. More loans granted = more investors and people entering the market.
The bottom no doubt will be called by the property spruikers endlessly for the next 12 months I'm sure, just as accurately as the pundits have said the sharemarket has bottomed for the last 12 months
hehe - the challenge is on!
http://business.theage.com.au/busin...-his-boots-on-house-prices-20081128-6mis.html
I like it
http://business.theage.com.au/busin...-his-boots-on-house-prices-20081128-6mis.html
I like it
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This is great - maybe the ABC can do a doco or two on the countdown to the big walk. I don't think we'll see any land speed records broken
hehe - the challenge is on!
http://business.theage.com.au/busin...-his-boots-on-house-prices-20081128-6mis.html
I like it
I can't wait to see Prof Keen on the top of the mountain in that ""I was hopelessly wrong on home prices! Ask me how" T-shirt
Cheers,
Beej
Whilst what you say is correct, from 1991 onwards (in Sydney at least) prices did start to slowly tick up (a few % a year) between 1992 and 1994. Ie the bottom of the market was clearly hit during 1991 as the economy hit rock bottom. Good houses were also very thin on the ground then as well, meaning that although the stats showed a bottom, it was actually very difficult to find those "bargains".
Beej
numbercruncher
Beware of Dropbears
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Very true ....
Much harder to waste cash that you dont have ! easy to loose votes when your at the helm when the economies going down the gurgler to boot ....
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I can't wait to see Prof Keen on the top of the mountain in that ""I was hopelessly wrong on home prices! Ask me how" T-shirt
Cheers,
Beej
lol I also can't wait to see Rory Robertson to do the same either! In general sense, either one would just be funny to see. hah
Do anyone know how Rory Robertson came to his "less than 1% chance of house prices going below 40%"? and that it "effectively requires a meltdown of the nation's financial system"?
Yep, his shiny, propertiary economic computer models designed by his highly paid PHDs who believe the past can predict the future and are completely ignorant of black swan events.
Do they even realise it is these very FLAWED computer models that caused the whole subprime mess in the first place? Ohhhh, 10 degree sigma events happened, shouldn't happen in a billion years, it's impossible, but it did! doh!
I hope he isn't putting faith in his computer model. Nassim Taleb is always right on this, black swan event will eventually kill it.
If I were Steve keen though, I wouldn't bet on it. Not that I don't faith in my own prediction, but I would be in a loss-loss situation even if I win. The public will hate me deeply for making such a gloom and doom prediction and would probably blame me for kick starting the "negative sentiment" that eventually become self-fulfilling.
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