House prices to keep falling for years

[awg]

How you think no doc, no deposit loans and all other substrates will fair without a MBS and insurance market?

I just asked a similar question in another thread.

who will offer Mortgage Insurance for the less than 20% deposit crew?

with the distinct possibility of 20%+ falls in many areas, my opinion, is that that option will dry up completely.

would you risk it!! say AIG please.

for the life of me, I just cant see that as being a risk management winner...and thats what insurance companies do!

So dont need to sell, cause any buyer with funds, who can wait a bit will be saying "maybe I can pick up a REAL bargain in 12 months"

 

[pepperoni]

any questions fire away

thankyou
robots

1. O seer of st kilda:

Do you think it might be possible that the RBA has seen recent falls in house prices and home loans and is resorting to cuts to soften even larger falls they expect to hit the property market?

2. O buffet of bicycledom:

Do you think the RBA is worried that we may be headed for the same negative equity hell that the IMF has commented on in "advanced markets" like the US and UK?

A correct answer to either of these will be required before futher questions can be asked

 

[nunthewiser]

hello,

good evening fellow australians,

howzat, Aussie Loan is dropping 90 basis pts and Nab has smashed its fixed rate loans,

markets reckon another 75 basis pts coming soon as well, Fantastic

any questions fire away

thankyou
robots

HI in all honesty do you think that this carrot will encourage a new wave of homebuyers or merely just help bailout those that are doing it tough.

in your own opinion of course
thanks in advance
a subdividing nun with land for sale to hopefully a brighteyedbushytailed new investor thinking the realestate market is all sunshine and lollipops

 

[robots]

1. O seer of st kilda:

Do you think it might be possible that the RBA has seen recent falls in house prices and home loans and is resorting to cuts to soften even larger falls they expect to hit the property market?

2. O buffet of bicycledom:

Do you think the RBA is worried that we may be headed for the same negative equity hell that the IMF has commented on in "advanced markets" like the US and UK?

A correct answer to either of these will be required before futher questions can be asked

hello,

wow looks like its going to be busy night but i dont mind doing it for ASF and fellow ASF members

1. no, aus plodding along nicely and RBA is only concerned about jobs zip else

2. no, we lead the world and are way ahead of US, UK or any other mediocre country that is on this planet

3. answer for nunthewiser: for people looking to buy a home then yesterday, today, last year or any other day is perfect for purchasing

apologies to nunthewiser for including the answer in this super response, trying to get through as many as possible

thankyou
robots

 

[chops_a_must]

hello,

what a great first up question chops,

most likely they will be tweaked around the edges, I hope that answers your question

thankyou
robots

Lol.

O RLY?

 

[nunthewiser]

hello,


3. answer for nunthewiser: for people looking to buy a home then yesterday, today, last year or any other day is perfect for purchasing

apologies to nunthewiser for including the answer in this super response, trying to get through as many as possible

thankyou
robots

thankyou. i do understand this maybe a busy time for you here.

there is no need to apologise

have a great evening

 

[robots]

hello,

and dont forget,

if you see people in the street friday remind them all is well, the sun is still shining, the kids are kicking the footy in the street, the coffee still brewing, life in all its glory continue's on

good evening

thankyou
robots

 

[Glen48]

Un employment is starting to go up first sign of a recession.
Aussie owe more than yanks do and are deeper in debt.
Get out of debt now.

 

[pepperoni]

Un employment is starting to go up first sign of a recession.
Aussie owe more than yanks do and are deeper in debt.
Get out of debt now.

hello

yes imminent strife but "the sun is still shining, the kids are kicking the footy in the street, the coffee still brewing, life in all its glory continue's on"

we should all proceed in ignorant bliss

thank you

*rides off on mongoose bmx*

 

[Kauri]

Cheltenham & Gloucester, the home-loans arm of Lloyds TSB, yesterday withdrew some of its mortgage "tracker" deals linked to UK Bank Rate in the wake of the 50bp Bank Rate cut to 4.5%, according to The Times. The newspaper says Nationwide and Abbey are understood to be planning similar moves. ... mmm.. they are only offered to the punters when rates are rising?? Lets throw them a few more Blns in appreciation of thier generosity..

Cheers
..........Kauri

 

[Aussiejeff]

Hmm.

Valad property developer slammed - shares slump 50% and Gold Coast RE projects mothballed.

Question: If rate cuts give average mortgage holders say, $200mth back in pocket, but plummeting $AUBananBuck causes prices of ALL imported goods (food especially) to rocket over coming weeks so that monthly household shopping bill increases by $300, banks don't cut credit card rates but cut savings rates - how in hell will that make everyone better off?

Why is everyone dancing in the street over this?

 

[Glen48]

Monday 13/10 night ABC 4 corners has Paul Barry on again over in USA looking at housing. He did a story about 12 mths ago so we can see how things have gone (down) since then.

With 2 million OZ small ans medium business on the edge some thing has to happen with in weeks I think another 1% could be on the cards.

 

[pepperoni]

hello

what happens when the value of the loans start to fall

esp given that they were was the sole fuel for house price increases

charts courtesy of dhukkas excellent blog

thank you

 

[jonojpsg]

Hmm.

Valad property developer slammed - shares slump 50% and Gold Coast RE projects mothballed.

Question: If rate cuts give average mortgage holders say, $200mth back in pocket, but plummeting $AUBananBuck causes prices of ALL imported goods (food especially) to rocket over coming weeks so that monthly household shopping bill increases by $300, banks don't cut credit card rates but cut savings rates - how in hell will that make everyone better off?

Why is everyone dancing in the street over this?

Aussie I'm not sure why you think we import food?? Doesn't Oz produce about three times what we consume? Sure there are tins of Thai tuna or Chinese tomato paste, but there are very few products we don't make here.

Besides which, coming into sprin/summer growing season so grow your own

 

[Aussiejeff]

Aussie I'm not sure why you think we import food?? Doesn't Oz produce about three times what we consume? Sure there are tins of Thai tuna or Chinese tomato paste, but there are very few products we don't make here.

Besides which, coming into sprin/summer growing season so grow your own

Apart from the Californian Potatoes and grapes?

How about the miriad of "Australian" packaged foods that have on the label

"PACKED or MANUFACTURED in AUSTRALIA from AUSTRALIAN and IMPORTED PRODUCT" Funny how we the consumer are usually never told the percentage of that "imported product". My guess is that it is pretty high in many instances because it is CHEAPER.

Have alook next time around the shelves of you local Woolies or Coles. You'll be amazed at what packeted foods contain that is IMPORTED - either wholly or as an unknown percentage of that so-called "Australian" product.

 

[N1Spec]

can someone enlighten me on what usually happens to property prices during a depression?? im guessing it will be savaged just like all other asset classes correct??

 

[ROE]

can someone enlighten me on what usually happens to property prices during a depression?? im guessing it will be savaged just like all other asset classes correct??

Dont know what future will hold but looking at historic data will give you some idea.

http://www.whocrashedtheeconomy.com/

but very simple economic can explain it.
to sell something for higher someone need to take on bigger debt
so you buy a house 300K and want to sell for 400K that person has to borrow more, 400K to 500K again more debt.

in depression you get an effect called debt deflation that mean you can no longer borrow more, banks just wont lend you so u have a negative effective
less money available so people aint willing to pay more for asset
so down it goes until, debt expand again.. How long it go for who knows
but Japan has been in that period for the last 20 years, the US in year number 2 ... just keep counting... Australia just about to go into that cycle

Understand what you buy and you dont worry about the cycle. Ignore
the jingle stronger for longer mining boom bull**** and lack of housing cause price to rise etc... that sort of jingle don't follow economic model.
UK right now has shortage of rental properties yet price plummet on a monthly basis.. that because they are in a debt deflation phase.. no more money, no more price rise.

 

[robots]

hello,

woo hoo, the Shock Exchange on another great run 8% smashing in one day

16% for the week, here we go here we go

man what a day here in Melbourne the sun is shining beautiful 23 degrees,

direct property bonanza, no board, no management, no middle management, no employee's, just you and a paint brush creating a masterpiece for yourself and others,

real assets and real returns will keep people coming through the door,

what a country

any questions fire away

thankyou
robots

 

[chops_a_must]

Lol. Just lol.

How long before these mortgage houses have to foreclose on a fair chunk of their clients to get capital back?

Does a massive systemic asset deflation not include home prices?

 

[robots]

hello,

a. things wont close when debt is getting cheaper, yes thats right debt is getting cheaper, down 1% in past couple of months and most likely more reductions to come

b. thats right, does not include house prices as its just a roof over your head not some whiz bang company

thankyou
robots