House prices to keep rising for years

[numbercruncher]

Ben Bernancke is an expert on the Depression and is doing what it takes

The permabulls crack me up, one minute they dismiss the goings on in the US, " because its different here " , next minute the US is the basis for continued price growth.

 

[Beej]

We live in an information age where you guys scare each other to death and economic impotency with every indicator. The rest of us show fortitude and get out there to make a positive difference.

Great quote and oh so true!!

PS: Sydney auction clearance rate 52% for today with 174 wise souls buying while the buying is good and the interest is cheap http://www.homepriceguide.com.au/saturday_auction_results/sydney_domain.pdf

Cheers,

Beej

 

[chops_a_must]

Head stuck in the sand is where I would say you are positioned. When in human history have you seen such a concerted and co-ordinated effort to lick the problem?

About 1932 young whipper snapper.

 

[robots]

hello,

here we go, the world is going to end

cant see lines in the street at soup kitchens, 30% unemployment dont see that,

go and get some fresh air

i know i know i have to wait it takes time, 6mths, 12 mths its not instant

thankyou
robots

 

[juddy]

hello,

here we go, the world is going to end

cant see lines in the street at soup kitchens, 30% unemployment dont see that,

go and get some fresh air

i know i know i have to wait it takes time, 6mths, 12 mths its not instant

thankyou
robots

2 months into the Aussie leg of the crisis and they think it's all over.

 

[lioness]

Ben Benanke has been bailing out and relieving the banks of bad debt and lumping it onto the US tax payers. They are now starting to follow the same principals here. And some time next year when they realise that pouring more fuel on the fire does not work the banks will raise rates at a huge rate. Read a few books by some reputable independant economist. Most bank economists started out as bank tellers and just got promoted to move them out of their previous incompetence.

Maybe your head is not in the sand but you are only taking in what suits your financial direction. Wish you luck but it often does not work.

Explod,

If you knew anything about economic cycles, you would know we will not see double digit % rates for decades. If inflation comes later, it will only take a few 1% hikes to kill it. Given the unemployment mounting every day if read the basic newspapers, you would have worked out quickly we will not see high % rates for a decade or longer.

 

[explod]

Explod,

If you knew anything about economic cycles, you would know we will not see double digit % rates for decades. If inflation comes later, it will only take a few 1% hikes to kill it. Given the unemployment mounting every day if read the basic newspapers, you would have worked out quickly we will not see high % rates for a decade or longer.

It has been reported this week that the crash dive in commodity prices which began in July 2008 is now considerably worse both in its magnitude and its swiftness than the fall during the entire 1929-1933 economic and financial collapse. In the US, retail sales in November had their biggest one month fall in 35 years and the acceleration of the collapse is unprecedented. With Gold now down a "whopping" 10.3 percent in US Dollar terms this year, Oil is down over 72 percent since July 2008 and most other basic commodities have had falls of a similar magnitude. The CRB index has fallen 47 percent since July. Official US unemployment has reached 6.7 percent as 533,000 jobs were lost in November. That's 28 percent of the total for the year in one month. When factoring in people looking for work (not counted officially) and part-time workers looking for full-time work (not counted officially), the REAL US unemployment rate is now estimated (unofficially) at 12.5 percent.

Courtesy the Privateer Newsletter. A sound independant economist

Follow the waves as you wish, but if you really became cognisant of the real economic fundamentals you would s...t yourself

 

[shaunQ]

Why would anyone have any faith or confidence in the political system being able to fix anything, let alone a major crisis. Since when has any international effort actually succeeded in the long term? 99% of the time they screw it all up and make it worse.

Why would this be any different? The US Oligarchy will look after itself and thats it.

Personally I think we will see a short-term boost - so we'll see some figures soon that the 'sand heads' will trump as it all being over, yet when it truly sinks in it will hit hard. This is the denial stage...

Someone say rates are low? The paper today says Gold Coast council is aiming to raise rates 20%, after a 8.5% increase last year, after the mayor was elected on the promise of a rates freeze.

 

[Beej]

Courtesy the Privateer Newsletter. A sound independant economist

Follow the waves as you wish, but if you really became cognisant of the real economic fundamentals you would s...t yourself

That's simply alarmist BS, and exactly the type of thing Passive was referring to when he wrote

We live in an information age where you guys scare each other to death and [into] economic impotency with every indicator

.

Commodoties have "crashed" many many times before. in the early 70s, in the early 80s, in the early 90s etc etc etc. This time they had a huge run up due to unprecedented demand from heavily populated developing countires, hence a long way to fall on the collapse of the cycle. By the way this demand WILL return in the not too distant future!

The demand and prices for nearly all commododities is so clearly cyclical it's not funny. As for unemployment - you are making such a big deal about 6.7% unemployment in the US??? It's been higher than that plenty of times! They have been in recession for a year now remember. Sometime (probably) next year things will start to recover there, unemployment will peak and stabalise, the housing market there will bottom/stabalise, and the rest of the world will enter a recovery phase as well. THE WORLD IS NOT GOING TO END! You should lighten up, really! Most people will still go to work every week and perform productive activities, and will continue to do so!

If we are lucky here our economic downturn will be shorter and shallower as we have certainly had some insulation up to this point, and a little more monetary/fiscal insulation left to play out yet. I don't buy this Australia is N months/years behind the US/Uk argument- it's a global economy, a global crisis - it hit us at the same time as it hit's them. We have weathered it better - it's still going yes but when things recover our recovery here will begin at the same time, so therefore it will be a shorter downturn here (this has already been proven by how well AU has weathered so far) = (hopefully) less unemployment and damage to living standards and the economy. To get back on topic, that INCLUDES house prices.

Cheers,

Beej

 

[chops_a_must]

That's simply alarmist BS, and exactly the type of thing Passive was refering to when he wrote .

Commodoties have "crashed" many many times before. in the early 70s, in the early 80s, in the early 90s etc etc etc. This time they had a huge run up due to unprecedented demand from heavily populated developing countires, hence a long way to fall on the collapse of the cycle. By the way this demand WILL return in the not too distant future!

You need to seperate debt, leverage and demand and then re-write that post. Because undoubtedly it is based on that faulty premise - and not worth reading until it's on the correct footing.

 

[numbercruncher]

This time they had a huge run up due to unprecedented demand from heavily populated developing countires, hence a long way to fall on the collapse of the cycle. By the way this demand WILL return in the not too distant future!

 

[inenigma]

2 months into the Aussie leg of the crisis and they think it's all over.

Sorry.... I hadn't realised that it had started already... Oh my, I am late.....

Must Run....

 

[So_Cynical]

1 Bedroom house in Ashfield 350K

http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2007455799

Its not big money is it.

 

[explod]

None of us want this dredful scenario playing out and we contribute as best we can to help each other. Things may in fact pan out different to what anybody thinks. The more we can inform each other the better.

bed for me now. enjoy the barter

cheers explod

 

[numbercruncher]

1 Bedroom house in Ashfield 350K

http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2007455799

Its not big money is it.

Do you city folks actually live in dog boxes like that ?

 

[Julia]

1 Bedroom house in Ashfield 350K

http://www.domain.com.au/Public/PropertyDetails.aspx?adid=2007455799

Its not big money is it.

Good Lord, what a horrid litle dogbox.
Can't believe anyone would pay $350K for that!

I looked at a house today (potential IP), three bedrooms, two bathrooms, two large living rooms, big kitchen, large block with dozens of fruit trees, in a good area, bus stop at door, and would have no trouble getting it for $300K.

This is in a fast growing tourist-oriented Qld town (pop. 55,000), three hours by road fromBrisbane.

 

[IFocus]

Head stuck in the sand is where I would say you are positioned. When in human history have you seen such a concerted and co-ordinated effort to lick the problem? We live in an information age where you guys scare each other to death and economic impotency with every indicator. The rest of us show fortitude and get out there to make a positive difference. Now is the time to start looking.Ben Bernancke is an expert on the Depression and is doing what it takes. Somewhere along the line it will change
and with lower interest rates most property investors are moving to strongly positively geared real estate. On one of my IPs alone I am $600 better off per month as a result of drop in rates. That is net income and most investors who are holders are discovering a new income stream!. All starting to look very attractive.

90s were high int, high unempl, etc etc. We have low rates, lowering further an IPs are becoming damn attractive to holders. One Einstein in the 90s , when some of us were buying - was predicting property would never rise by more than 1% pa - what a joke. Homes are to be lived in and soon it will be cheaper to buy and the banks and govt are doing everything to boost things. This will lead to another boom, then bust - I am not happy with this, would prefer a modest rise but as long as central bankers control fiscal policy as they do - nothing much will change. I have experience and profit on my side - that presupposes a positive attitude - I will not allow fear to scare me senseless! And I am WA based and do not share your view.

Look at todays AFR and look at the chart of property prices in the world - still up by a large majority - compare that to the share market - hail property!

I have been looking at WA property prices since the early 80's this recent run up has been extreme, no precedent that I am aware of and as is the case of most things prices will balance back to the mean.

I don't know how that will happen but it will its a simple concept.

To build a rise in housing prices you will need another credit expansion of some sort, currently there is a credit contraction that will take some time to unwind.

Prices will fall, here in Mandurah stock is rising and there are few buyers with rising unemployment confidence will fall further.

Cash is king there will be opportunity for those that can keep their jobs. I note jobs being culled by the resources industry here in WA on a scale never seen before.

Another thing I think about is thanks to history we are well aware of what happened after 1929 but what the down side is to the current government reactions around the world will be is still to be a surprise.

As for comparing the stock markets performance with property I think its a little early, property really is an elephant but once started hard to stop either way.

As always I guess we will have to wait and see....... here is to the trend turning up sooner.

 

[numbercruncher]

Good Lord, what a horrid litle dogbox.
Can't believe anyone would pay $350K for that!

I looked at a house today (potential IP), three bedrooms, two bathrooms, two large living rooms, big kitchen, large block with dozens of fruit trees, in a good area, bus stop at door, and would have no trouble getting it for $300K.

This is in a fast growing tourist-oriented Qld town (pop. 55,000), three hours by road fromBrisbane.

Heya Julia ,


has Realestate in the Wide bay region pulled back in price much through this year ?

 

[shaunQ]

This is in a fast growing tourist-oriented Qld town (pop. 55,000), three hours by road fromBrisbane.

Let me guess, Hervey Bayish. I was looking at a property around there, 400M from the beach, 298K.

3 hours from Brisi is pretty far though IMHO, and not much other corporate work anywhere up there. So too far for me at the moment. Beautiful though.

 

[Julia]

Let me guess, Hervey Bayish. I was looking at a property around there, 400M from the beach, 298K.

Exactly right, Shaun.

3 hours from Brisi is pretty far though IMHO, and not much other corporate work anywhere up there. So too far for me at the moment. Beautiful though.

You're quite right about the work situation. Focus is almost entirely on tourism and servicing the local population.
An aviation training school was proposed for the Maryborough Region but the proposers withdrew last week citing (in polite terms) utter incompetence and stuffing about by the local Regional Council. They are a hopeless bunch.

NC, glad to know you're making such good progress in the recovery stakes.
Seems you've got off more lightly than could have been the case.

I think property prices in this area are down about 5%. Plenty for sale.
Those in the $1M and over are sticking.
Excessive development of multi story very upmarket apartment buildings on the seafront. Suspect too many of these have been approved and they will be struggling for occupancy.