House prices to keep falling for years
- Thread starter Pommiegranite
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I know who: The people 'crazy' enough to realise that a homeloan is for 25-30 years and that a cut in interest rates doesn't protect you from hikes 2 years down the line.
Hey on that subject, does anyone know whats the fixed rate for 25 years?
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Another 50 points predicted for December (bottom of article)
http://www.news.com.au/business/money/story/0,25479,24602041-14327,00.html
Would expect the banks to keep some of the most recent 75 point cut following CBA's lead, but no complaints nonetheless.
http://www.news.com.au/business/money/story/0,25479,24602041-14327,00.html
Would expect the banks to keep some of the most recent 75 point cut following CBA's lead, but no complaints nonetheless.
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I'm renting at under market rates, and don't see the point in renting money unless the gummint is giving me a nice fat tax deduction on the interest.
Just a few simple sums, using market rents as average, will show you that for a median property you are thousands of dollars better off a year by buying the property next door, becoming a landlord, and continuing to rent yourself.
I know who: The people 'crazy' enough to realise that a homeloan is for 25-30 years and that a cut in interest rates doesn't protect you from hikes 2 years down the line.
Hey on that subject, does anyone know whats the fixed rate for 25 years?
No way I would go variable.. that's why I'm interested to see the lowest fixed rates could actually go
Most of that funding is sourced from o/s, that's why I have my doubts they'll go too much lower. But hey, we'll see.. The thing is all those screaming over "high" interest rates 6 months ago no doubt will fail to fix at the best opportunity in maybe 10 years. Ahh.. if only they would fix for 25 years eh.. They're not stupid.
This is probably what I'll be doing.. but for most PPOR people, who like the idea of living in their own house, they don't see these things.
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Oz still runs a very high current account deficit.
meaning we need to attract foreign funding to support our lifestyle.
As at least 30% of housing funding is sourced OS, they need a reason to do this.
Our currency has flattened very hard, so that means foreign banks will not wish to invest in Oz unless they get a good interest rate.
In Iceland for example interest rates are now 17% +
GMAC and GE have pulled out of new finance in Oz due to poor margins.
I would be surprised if this affect did not start to bite the banks hard, meaning rates may not fall as much as people think they may.
for me personally I prefer relatively stable interest rates, as I have both investment property and cash/term deposits.
Constantly having to re-jig is a pain in the ars#
meaning we need to attract foreign funding to support our lifestyle.
As at least 30% of housing funding is sourced OS, they need a reason to do this.
Our currency has flattened very hard, so that means foreign banks will not wish to invest in Oz unless they get a good interest rate.
In Iceland for example interest rates are now 17% +
GMAC and GE have pulled out of new finance in Oz due to poor margins.
I would be surprised if this affect did not start to bite the banks hard, meaning rates may not fall as much as people think they may.
for me personally I prefer relatively stable interest rates, as I have both investment property and cash/term deposits.
Constantly having to re-jig is a pain in the ars#
hello,
g, i have been on variable since starting loans, and will most likely stay that way until end
first up was around 5.5% i think, has moved up in recent years so i pumped some cash in to keep "weekly" payment running at same level, may take cash out may leave in will see what happens
thankyou
robots
g, i have been on variable since starting loans, and will most likely stay that way until end
first up was around 5.5% i think, has moved up in recent years so i pumped some cash in to keep "weekly" payment running at same level, may take cash out may leave in will see what happens
thankyou
robots
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My stock positive gear from day one ..why would I buy negative gear asset?
I don't buy anything negative gear doesn't matter about future potential
you take a lost for something that may or may not eventuate.
Every year you fall behind, you got to make more money next year to break even.
I like old fashion way, invest if you got money else pay off your mortgage
People bankrupt or broke not because they have little money but because they have big debt or negative gears asset.
and that just comes down to Greed............
I have never been for negative gearing. Don't like the risk even if property was at 3-4 times income. Positive geared with a good buffer is another story but not at 7 times annual income.
Funny how buyers are offering property sellers stupidly low prices at the moment! I guess some buyers have waited for some time for properties to drop. The 0.75% drop in interest rates today will not help these (also) "Greedy" bargain hunters. They'd love to see some tall poppies fall.
Greed is everywhere, just looking for some level ground.
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This is a very salient point. Australia is running up a sizable current account deficit which needs to be funded by foreign capital. Aussie banks need to keep a healthy margin in place to sell their bonds to foreign investors. The RBA can cut the cash rate all it wants, but the banks will be more and more selective about what they pass on as the rate comes down.
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Come on, greedy? This is how the market prices things. Something is only worth what someone else is willing to pay for it. Ask stock holders what those apples taste like atm.
It seems that many property owners have gotten so used to annual price increases that they feel it's their God given right to get more of the same year in, year out. Greedy buggers!
Glen48
Money can't buy Poverty
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Sorry I predicted rates would come down 1% but we only got .75 but next month they will come down another .5% to try and stem the Fire ball but to no avail.
Got another boost by renting as house prices have come down 3.3 % here so my landlord has lost that of the "Investment" scoff, so inflation has to go up a lot before I am loosing.
Got another boost by renting as house prices have come down 3.3 % here so my landlord has lost that of the "Investment" scoff, so inflation has to go up a lot before I am loosing.
Glen48
Money can't buy Poverty
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I see banks are offering 7-8% in an effort to attract money, how much will the banks pass on from the last adjustement?
When will rents start to go down as we get flooded with unsold Houses?
When will rents start to go down as we get flooded with unsold Houses?
hello,
landlord should get down to st Kilda glen48, pass him on a note since you so interested in his/her life
i'm not sure if I have mentioned it, St Kilda up +14.7% for Sept 08 Quarter results, the money i rent just got cheaper too, and a new letter typed up for rent increase to the tenant
great being on month by month lease with tenant as I can maximise the return, would be silly as a landlord to go for a yearly Glen48
utopia,
did someone say St Kilda?,
enjoy the day, spend up for the country
thankyou
robots
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In a mining town as the commodities boom ends? Pretty soon.
In a capital city, 5kms from the CBD with access to mutiple forms of public transport? Wouldn't want to bet on rents falling.
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Come on, greedy? This is how the market prices things. Something is only worth what someone else is willing to pay for it. Ask stock holders what those apples taste like atm.
It seems that many property owners have gotten so used to annual price increases that they feel it's their God given right to get more of the same year in, year out. Greedy buggers!
There is greed and greed.... What I mean is that property owners would be happy with growth of 5-10% year on year, but the buyers (at the moment) are offering -40% on valuations of our property of a month ago. A -10% drop now would be considered perhaps fair but not -40% and its not just one or two offers. News in Melbourne claimed yesterday the drop in the last month has been 3-5% in property prices.
Guess I should have owned in St Kilda. I heard the prices there may have increased.... hey "bots". (Its a new type of bot trading!)
Ouch. What end of the market? Inner or outer suburbs? Thing is now all the buyers expect the slump, and believe the Steve Keen -40% type figures. Seems more than anything sentiment in the market has changed to start believing the D&G scenarios...whether they are actuality or not.
Then again..
I'd be inclined to believe in this environment the Government is still being optimistic there, so if those are the blue sky projections..
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Spot on. When has any the RE market NOT been about sentiment. Let's face it, house prices have never been solely about fundamentals. Future capital growth has been overfactored into current prices due to sentiment. Now for the unwinding until sentiment changes again.
I'm just waiting for it to shoot to oversold before I buy in.
That's a very sensible approach - but just be careful to not over-estimate the amount of correction that may or may not occur, and end up missing out on an opportunity when it presents itself. Remember, it can take months just to find the house you are prepared to buy/live in long term, and a lot can happen in the market place in between, so you have to watch things very closely - actually "on the ground", not just from the newspaper articles, abs stats and web blogs etc
Cheers,
Beej
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