House prices to keep rising for years

[gav]

hello,

fantastic result Gav, 15.3% in the Dec 08 quarter amazing

great suburb right on the water there with a very nice beach behind the tea-tree, nice bakery on the highway

probably similar right through bonbeach, chelsea, edithvale and aspendale

45-50 min train ride to the city

nirvana everywhere

thankyou
robots

Thank-you Robots

Since the page has been updated, the annual change is 15.3%, with the Dec 08 quarter up 17.6%

There are bargains out there for those who seek...

 

[So_Cynical]

Absolutely. This ones only $97,000 - Can picture my 4 kids living by the beach in this sea side mansion... ?

http://www.realestate.com.au/cgi-bi...r=&cc=&c=27886723&s=vic&snf=rbs&tm=1234695708

But it is Victoria, so beaches aren't that popular are they?

Nothing wrong with the beaches in that area, Seaford - Carrum - Chelsea etc, i grew
up there and have many fond memory's of summer on the beach....lived right across
the Hwy, 3 minute walk to the water....esky in hand It gets hot in Melb for at least
7 or 8 weeks in Summer.

 

[Bill M]

Yep all's well in Bonbeach with prices like this.

PS Station St BV 5rm $180,000

Gee you guys are lucky there in Melbourne. We would be lucky to buy a 1br unit in a dodgy suburb over here for that. Those prices in seaside suburbs won't last forever.

 

[theasxgorilla]

You talk about liquidity, that's just not right. Properties that are priced correctly still sell within 2 and 4 weeks time.

What you describe, without saying it, is that you can always create a market for your property by dropping the price. A property can be correctly priced and yet no market exists for that property. Then it becomes a matter of time to find the right buyer. Its not at all like trading shares. Property is not liquid and therein lies opportunity.

 

[kincella]

I did a quick search on the realestate site for bonbeach....most were way over the 550k price...and the 97.000 was a beach box....so 180k is not an average price
the fhb range has been turning over in a week....and there is an average of 4 weeks at least in some suburbs....bit different to shares...probably due to the hundreds of thousands of dollars involved, compared to the average punter with only a few thousand to play with shares.....
the bigger investment should take a bit more thinking time....hence the delay in turning over....
and settlement is usually at least 30 days....so do the agents report the date of the contract or settlement date..as the date sold ???
cheers

 

[Bill M]

What you describe, without saying it, is that you can always create a market for your property by dropping the price. A property can be correctly priced and yet no market exists for that property. Then it becomes a matter of time to find the right buyer. Its not at all like trading shares. Property is not liquid and therein lies opportunity.

What I was saying for example is that I know for a fact that nearly all 2 br units in my area sell for between 350K and 450K. The shabby tiny ones sell for 350K and nice, bigger, newer ones sell for 450K and therefore those units are priced correctly and will sell within 2 to 4 weeks. Then along comes Mr hopeful and he wants 550K for his unit and nobody buys it because he has incorrectly priced his unit. If the property is priced correctly then there is a very strong market in my suburb.

The liquidity aspect is as kincella suggests. A property can be sold in a week but there is a 2 Month contract to sit out before you get your money. It isn't as liquid as shares but it is still liquid.

 

[Beej]

o do the agents report the date of the contract or settlement date..as the date sold ???
cheers

They report the sale at contract exchange, not settlement (which as you state can be a fair time after exchange - usually 6 weeks in NSW).

PS: Re all the activity in lower FHB type price ranges, what many people aren't thinking about is what happens to the money from those sales in the following couple of quarters. Watch the numbers, both price growth and volume. Activity in the next couple of tiers will pick up on the next 2 quarters - especially in Sydney.

Cheers,

Beej

 

[Beej]

FYI - Sydney Auction clearance rate a healthy 73% last weekend - see http://www.homepriceguide.com.au/saturday_auction_results/sydney_domain.pdf.

Also, ABS lending finance stats for Dec 08 out: http://www.abs.gov.au/ausstats/abs@.nsf/mf/5671.0?OpenDocument

HOUSING FINANCE FOR OWNER OCCUPATION

* The total value of owner occupied housing commitments excluding alterations and additions increased in trend terms (up 1.7%) and the seasonally adjusted series rose 7.1%.

Also another interesting article: http://www.news.com.au/business/money/story/0,28323,25060007-5013951,00.html - "Investment properties making a comeback" - talks about neutral/positively geared rental property becoming available in Sydney and Melbourne, plus the increase in buyer activity so far this year.

Cheers,

Beej

 

[robots]

hello hello,

mr louis must be feeling a bit crook to pen this:

http://www.theaustralian.news.com.au/business/story/0,28124,25059396-25658,00.html

oh well, things are always changing,

another great day on the planet

thankyou
robots

 

[Bill M]

Yes Robots you are right. Here is some more evidence of a booming market here on the Northern Beaches in Sydney which is what I've been trying to tell the doomsdayers. Little supply and hundreds of buyers, 80 people through one unit in a day! Why would anyone rent when you can buy for less or the same money?

------------------

FIRST-HOME buyers are out in force on the peninsula with anything under $500,000 being snapped up.

according to Wilma Goudappel of L.J. Hooker Freshwater who had 80 groups inspect a unit in Foam St, Freshwater.

“I was showing an unrenovated unit in Manly to people renting in the block and it turned out their repayments would be the same as the rent they were paying,” she said.

Full article here, click here.

 

[MrBurns]

Spoke to an agent today, prices in Kew Vic down at least 25%

 

[numbercruncher]

according to Wilma Goudappel of L.J. Hooker

 

[Bill M]

I know this area like the back of my hand, that report it is 100% correct. I'm there weekend after weekend watching what's going on. It is when people start talking about 50% crashes then they are just kidding themselves. Now is probably the best time ever to get set with real estate, lowest interest rates in 45 years and rents are higher than mortgage repayments for the same property. Good luck renting

 

[shaunQ]

Now is probably the best time ever to get set with real estate, lowest interest rates in 45 years and rents are higher than mortgage repayments for the same property. Good luck renting

Actually the thought just occurred to me - that your saying now is the time to buy - and the bulls keep talking about how we've bottomed - but hang on - what was meant to have caused this property stress? The interest rates moving up to 8%? So we have 6 months of 8% interest rates and the whole market collapsed? I mean, nothing has really happened in Australia to property (yet) so why have we had any impact if everything is so dandy?

 

[Bill M]

Actually the thought just occurred to me - that your saying now is the time to buy - and the bulls keep talking about how we've bottomed - but hang on - what was meant to have caused this property stress? The interest rates moving up to 8%? So we have 6 months of 8% interest rates and the whole market collapsed? I mean, nothing has really happened in Australia to property (yet) so why have we had any impact if everything is so dandy?

I don't know what bulls you are talking about. Nothing has changed in my area, the demand for property was there 30 years ago, 2 years ago, last year and now. The reason I say now is the best time is because interest rates are at 45 year lows, never seen before in my life time. Locking in a home loan at 6% is as good as I have ever seen. The market in my area has always been buoyant and has never collapsed so I don't know what you are talking about there. I will stress again I am talking about my area, Sydney beach side suburbs and I don't know anything about other towns/suburbs around the country.

 

[sinner]

The market in my area has always been buoyant and has never collapsed

Great quote considering your signature.

 

[So_Cynical]

I don't know what bulls you are talking about. Nothing has changed in my area, the demand for property was there 30 years ago, 2 years ago, last year and now. The reason I say now is the best time is because interest rates are at 45 year lows, never seen before in my life time. Locking in a home loan at 6% is as good as I have ever seen. The market in my area has always been buoyant and has never collapsed so I don't know what you are talking about there. I will stress again I am talking about my area, Sydney beach side suburbs and I don't know anything about other towns/suburbs around the country.

Sydney beaches immune to price falls...i think not Bill, assuming u would call that area
the top 10% of the market...I know i do.

http://www.news.com.au/business/money/story/0,28323,25060007-5013951,00.html

QUOTE
According to property research group RP Data, the median price of the the top 10 per
cent of properties, based on price, slumped in Sydney, Melbourne and Brisbane last
year as financial markets worsened.

Sydney was hardest hit, with the top 10 per cent of properties slumping in value by
19.5 per cent, from an average $1.6 million to $1.29million.

 

[theasxgorilla]

The liquidity aspect is as kincella suggests. A property can be sold in a week but there is a 2 Month contract to sit out before you get your money. It isn't as liquid as shares but it is still liquid.

I don't agree, but I'm only pointing it out for the sake of discussion, not to be a prat.

Not only is it not liquid, but the transaction costs mean that immediately, straight off the bat you have a gapping deficit to claw back if you plan on flipping before that inevitable "keep rising for years thing" kicks in and makes your dreams come true.

 

[numbercruncher]

I don't agree, but I'm only pointing it out for the sake of discussion, not to be a prat.

Not only is it not liquid, but the transaction costs mean that immediately, straight off the bat you have a gapping deficit to claw back if you plan on flipping before that inevitable "keep rising for years thing" kicks in and makes your dreams come true.

Precisely ......

Your average NSW 500k IP needs circa 10pc growth just to break even .... big ask .... and after a few years of 3 to 4pc yield and 6pc + interest rates even ghastlier .....

 

[Bill M]

Sydney beaches immune to price falls...i think not Bill, assuming u would call that area
the top 10% of the market...I know i do.

http://www.news.com.au/business/money/story/0,28323,25060007-5013951,00.html

QUOTE
According to property research group RP Data, the median price of the the top 10 per
cent of properties, based on price, slumped in Sydney, Melbourne and Brisbane last
year as financial markets worsened.

Sydney was hardest hit, with the top 10 per cent of properties slumping in value by
19.5 per cent, from an average $1.6 million to $1.29million.

Out of my league SC, I'm only talking about the units priced in the 300K to 500K bracket, nothing has changed there. Properties in the Millions of $$ are of no interest to me, I just don't follow that market.