House prices to keep rising for years

kincella · 12 May 2009

nun....no point...your mates have got it covered on the other thread....
must admit I could not be bothered to read it....I just keep reading the other good news about the props....and I put that headline into what I term is 'junk' status from the media....everything today is more hyperbole that fact...its about grabbing headlines...to get news hits...to entice advertisers who are leaving...
just like any other junk they turn out about the GFC, politics, etc
there is probably 1.3 million people who will lose money on their margin loans, cfd's etc

its coming closer each day to 'I told you so status", but first, I have to wait to see what disasters are forthcoming in the budget tonight....

nunthewiser · 12 May 2009

kincella said:
nun....no point...your mates have got it covered on the other thread....
....

sorry you must have me confused with someone else ...i have no mates

funny how you guys try and discredit ANY data /media that contradicts your nice lil cosy fireside views YET spew the same media and data WHEN it suits

bless ya

satanoperca · 12 May 2009

Beej said:
We are now back to early 2008 levels.
Cheers,

Beej

Fantastic news, with unemployment rising, a huge government deficit looming, global economic contraction, petrol on it's way up again, lets go for broke and get in as much debt as possible to build the bubble even bigger.

Go Labour, you have the skills and balls to get us out of this mess just like last time and if you can't you can always blame Howard.

Cheers

kincella · 12 May 2009

nun...they are not mainstream media...they are property professionals...buyers advocates...the other ones I spruik about are actual stats from REIV,,again not mainstream media, the RBA, and ABS govt aka agencies...can you spot the difference;SHEEP:
http://www.morrellandkoren.com.au/topend/

Beej · 12 May 2009

satanoperca said:
Go Labour

That's Labor (we are in Australia not the UK!)

Personally, I don't see a rebound in housing finance after a slump anything to be too concerned about economically, quite the opposite in fact. Unless of course you are in the "wishing/preying for a house price crash" brigade.....

Only a small proportion of Gen-Y own their own home; all that's happening at the moment is they are all (finally) getting with the program, along with the Gen-X laggards as well. Ie pent up demand is being fulfilled as the opportunity has arisen. I think this is especially the case in Sydney were in absolute/inflation adjusted terms prices are down 20% since 2004, plus interest rates are very low; the longer one waits the shorter the period of low interest rates will be..... many see all these factors as a strong buy signal, especially if they have been waiting for years to be able to buy.

To each their own of course - just keep abreast of the facts and the likelihood of various outcomes.

Cheers,

Beej

MACCA350 · 12 May 2009

Beej said:
Ie pent up demand is being fulfilled as the opportunity has arisen.

I'd say there's a fair portion being pulled forward from future demand and many who simply couldn't afford to get in prior to the FHOG Boost and low rates.

cheers

Beej · 12 May 2009

MACCA350 said:
I'd say there's a fair portion being pulled forward from future demand and many who simply couldn't afford to get in prior to the FHOG Boost and low rates.

cheers

This is point of differentiation amongst opinions. I think the desperate "no-savings-quick-let's-buy-a-house-while-the-grant-is-on" buyers represent a very small proportion of the current FHBs (but makes is good media play and so gets dis-proportionate focus), and therefore an even smaller proportion of all current home buyers: 73% of purchases last month were still non FHBs.

Here's a good article on these numbers by Adam Carr of ICAP: http://www.businessspectator.com.au...e-loans-pd20090512-RY5CR?OpenDocument&src=sph

This shows that it’s more than just first homebuyers driving the market. As expected, loans to this segment were particularly strong, but it would be misleading to suggest that this is the only strong component. Non-first home buyers make up over 70 per cent of the market and loans here were up 4 per cent in the month – and of course I’ve already mentioned investors.

The RBA will be looking at these numbers with some satisfaction. The housing industry is one of the more interest rate sensitive sectors and it’s a positive that the response has so far been rapid. Moreover, when you look at the breakdown and see that loans for construction are rising rapidly (up 40 per cent from the trough and the highest since January 2002) – then we can be confident that this surge in lending will translate to greater housing construction activity, better overall economic growth and employment.

The result clearly ads weight to the argument that the Bank has done enough. I think it’s lost on many that other central banks around the world are cutting aggressively to counteract a breakdown in the transmission mechanism. This isn’t the case here – so it must follow that we don’t need to do the same. Housing construction looks set to turn sharply and this will do much to cap the rising unemployment rate.

And check out the attached chart from the same article - looks like we are returning nicely to the long term trend.

Cheers,

Beej

aleckara · 12 May 2009

Beej said:
And check out the attached chart from the same article - looks like we are returning nicely to the long term trend.

Cheers,

Beej

Hate to say it but if the trend continues then I can't see house prices going down all too much. Don't get me wrong; I'm not too thrilled about it - but I'm not seeing signs of increased affordability anytime soon (only short term affordability due to the inflation lag).

Housing while people cite other factors such as population growth, and all that all these factors matter nothing when credit is unattainable. Credit (especially with house prices getting further and further away from wages) is the only real fundamental and all these other fundamentals really just drive demand for credit.

Wow Rudd really did achieve his aim. Other countries have money to lend but no one wants to borrow, and they are really trying to kickstart borrowing. Rudd really gave us an incentive to borrow a lot of money.

MACCA350 · 12 May 2009

Beej said:
73% of purchases last month were still non FHBs.

Do those figures cover just the private sector, or do they include business purchasers also?

cheers

Beej · 12 May 2009

MACCA350 said:
Do those figures cover just the private sector, or do they include business purchasers also?

cheers

Hmmmm - they are for residential property only, which in 99% of cases would be private purchasers i would have thought? Or maybe it doesn't matter? They certainly do not include commercial property.

Cheers,

Beej

MACCA350 · 12 May 2009

Beej said:
Hmmmm - they are for residential property only, which in 99% of cases would be private purchasers i wuold have thought? Or maybe it doesn't matter? They certainly do not include commercial property.

Cheers,

Beej

Right, I just thought they may have included all property sales.

cheers

kincella · 12 May 2009

I think you will find if the govt does build all those extra public housing they are promising both fes and the states........we will see a two tier pricing regime...very affordable houses a bit out of town....and very pricey homes in the middle of town...as that article, see Robots link, about the recent prices and period homes....were very popular....if it was ordinary then forget it...no bids...
there would be no arguments if all would just buy what they can afford....
I doubt there are too many on this site who could afford a million dollar house

robots · 12 May 2009

nunthewiser said:
i see as usual no one adressed my article and merely skip around it with other happy stuff

great work fellas

sunshine and lollipops for all

hello,

i was responding to your post Nun, everything I see is sunshine and lollipops

everywhere

people get caught out every day with financial/money matters

thankyou
associate professor robots

kincella · 12 May 2009

FHB scheme extended to Sep and then phased out by Dec 09.....
psst I think the State Govt's will follow the Vic Govt and introduce their own FHB scheme which will be very similar to the fed Scheme....
it provides jobs to the industry...everybody wins
forget the lollipops...think Champagne

robots · 12 May 2009

hello,

thanks Kincella

its a great ROI for States/or Feds and I know Soft Dough is big on ROI

maybe the state stamp duty issues and the FHB grant are being tweaked to put more responsibility back to the states

thankyou
associate professor robots

gfresh · 12 May 2009

ha, well at looks like I can't escape the FHOG no matter how hard I try!

Really would like to buy before the end of the year... so watch the market crash, say start of 2010

Hopefully it slows down the stupid rush before June 30th, should be spread out a bit better. Doesn't leave much room for investors to pick up anything in the lower-priced segment though, I know a few have been waiting..

MACCA350 · 12 May 2009

kincella said:
FHB scheme extended to Sep and then phased out by Dec 09.....

Wimps.........guess they realised if they cut it the market would go into cardiac arrest: ...........better to switch to morphine and wane the market off it's dependency hey

I really don't get why they have to keep throwing tax payer dollars in to keep inflating housing, they should cut it all off(both federal and state) and let the market stand on it's own...........IMHO it's turned into a vicious cycle that gets worse the longer it goes on.

cheers

robots · 12 May 2009

hello,

its been going up and down since 2000 man with both the Feds & State doing there bit

wasnt an issue back in 2000, seems a major issue now though, strange

remember, soft dough said everything okay as long as government gets ROI, all about equality and the housing market should get assistance just like every other industry

thankyou
robots

kincella · 12 May 2009

and here I was already 'siked' up to become a little depressed...damn its back the the champers for me and the dog...
winners are grinners....

MACCA350 · 12 May 2009

robots said:
hello,

its been going up and down since 2000 man with both the Feds & State doing there bit

wasnt an issue back in 2000, seems a major issue now though, strange

thankyou
robots

So why not get rid of it completly and never bring it back, and let the market run it's own course...........I mean isn't it supposed to be all about supply and demand, yet we've got someone playing creative accounting in the middle

IMHO if they never brought it in in the first place housing would be more affordable, seems like they've been using it over the years to stop the market from falling as it would naturally do due to economic climates, and since it doesn't drop as much it just keeps climbing higher as things recover<----------have absolutely no evidence of that, total guesstimate

cheers

House prices to keep rising for years

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