House prices to keep rising for years

[xoa]

"Investors" accounted for half of all new home loan borrowings last year. It'll be interesting to see how many more interest rate hikes they can absorb before running for the exit. 0.25%? 0.5%? When will the house of cards collapse?

 

[wayneL]

http://www.rpdata.net.au/

Shows that the only real average decrease has been in WA

Although median house price is a load of BS as houses can not be priced as a commodity as there are so many variables between each and every property. There are stark differences between areas though, at the moment south west and western Sydney are decreasing in value whilst inner west and north increasing quite alot.

Not to mention the role of gentrification.

 

[numbercruncher]

http://www.rpdata.com/


Another thing I find very interesting on RPdata ....


They list amoungst other things " 29.2m property records, 17.6m property atrributes and features, 12.1m land parcels, 13.8m on market records "


Australia with 22m people and 2.6 pp household, so where is the shortage again ? Specific desirable areas obviously, urban consolidation will eventually cure that anyways.

Seems to me this demand exceeding supply is just propaganda ?

 

[explod]

http://www.rpdata.com/


Another thing I find very interesting on RPdata ....


They list amoungst other things " 29.2m property records, 17.6m property atrributes and features, 12.1m land parcels, 13.8m on market records "


Australia with 22m people and 2.6 pp household, so where is the shortage again ? Specific desirable areas obviously, urban consolidation will eventually cure that anyways.

Seems to me this demand exceeding supply is just propaganda ?

Australians are the highest percentage in the world owning pets. In the US now it can cost 50g for a burial service for a pet (hoolypoodle) so the impact of pets on aussie home demand is yet to hit.

 

[krisbarry]

And therin lies the difference between people like you and people like me,Stop.

Mr Average would be best to seek out opportunity so he departs from the "Average crowd".Where as those who remain Mr Average will find a reason to turn that or any opportunity into a liability.

One of the qualifications for MR average wasnt (Well I couldnt find it) that he was a Moron.

MR Average would do his due diligence.

There are by far a vast majority of honest hard working people living in these areas who do take pride in their efforts to get ahead in their world.
You under estimate human nature!

I'm sure you have come across this with your own rentals

Building a piece of infratructure doesn't make you an expert in the current climate. The southern expressway was built before a housing boom and in a period of low interest rates, the northern expressway will be built after a boom and in a period of high interest rates. Beats me why you are still beating the housing drum...for what purpose?

 

[tech/a]

stop.
Taking an alternate view in the discussion and answering questions relative to other submittions by others including yourself.
No other purpose.

 

[Mofra]

Link us some price rises RE bulls for the love of god!

Well, is only an individual case:

http://www.realestate.com.au/cgi-bi...t=&header=&cc=&c=37013264&s=vic&tm=1204628803

2 other identical properties in the same complex sold for $324k & $330k respectively late last year (November). Inner city properties have been scewing the figures for some time though - I could have just as easily posted the West Sydney mortgagee auction results & scared the pants off the bulls.

 

[pepperoni]

Yes the thread is "House prices to keep rising for years"

Rising at least 10% per year in fact. No question about it. In 10 years the average syd house will be 1.4m. In 20 Years it will be 3.7m.

In 50 years it will be $65m. This will be possible as average salaries will be over $15m a year. Of course if you have a uni degree you should earn this first year out as many graduates today make the average earnings.

Warren buffet is saying you are unlikely to get this sort of return on equities so get on the fast train to mega riches now people!

Im only getting 8% in term deposits on 1.8m as all the robots are crying out for my money to make the returns ... I must be crazy! And im paying penal rent of $260 per week on a huge 2 bedder in cremorne. What am I thinking?????

I need to rush out and become a slum lord asap. With the added bonus that I get to deal with tennants and real estates regularly. Cant wait! :

 

[ROE]

Yes the thread is "House prices to keep rising for years"

Rising at least 10% per year in fact. No question about it. In 10 years the average syd house will be 1.4m. In 20 Years it will be 3.7m.

In 50 years it will be $65m. This will be possible as average salaries will be over $15m a year. Of course if you have a uni degree you should earn this first year out as many graduates today make the average earnings.

Warren buffet is saying you are unlikely to get this sort of return on equities so get on the fast train to mega riches now people!

Im only getting 8% in term deposits on 1.8m as all the robots are crying out for my money to make the returns ... I must be crazy! And im paying penal rent of $260 per week on a huge 2 bedder in cremorne. What am I thinking?????

I need to rush out and become a slum lord asap. With the added bonus that I get to deal with tennants and real estates regularly. Cant wait! :

You breaking the dream of house price double every 10 years....
but here is some facts to back it up

House price in US last 116 Years
http://mysite.verizon.net/vodkajim/housingbubble/shiller_graph.gif

House in Australia vs USA in the last 100 years
https://www.aussiestockforums.com/forums/attachment.php?attachmentid=18783&stc=1&d=1204685897

so if you start at 25 (very very low compared to the graph) and compound at 8% for 100 years you should get 54,994.03.

look at the number on the graphs

some people will have a rude awakening soon

 

[numbercruncher]

Effectively will push down the demand and probably the price of established IPs ..... why ?


Lets say you have a rattly old IP rented for 300p/w.

New investor comes along Builds new place and rents it out for 240p/w (20pc below market val), but the Government gives you 6k a year or 120pw in tax credits (giving effective 360pw return), thats without even taking into consideration the state/territory contribution. States and Territorys seem to have lots of Property plans in the pipe line that seem to equate to downward price pressure.


Wouldnt want a ratty old IP when you can get a shiny new one and take advantage of this genorous concession.

Thoughts?

http://www.theage.com.au/news/nation...402337664.html


PM doubles rental aid

March 3, 2008 - 4:22PM

The Federal Government will offer $6000 tax credits to the private sector in an effort to double the number of affordable rental properties in Australia.

Prime Minister Kevin Rudd made the announcement in front of more than 700 people at a business forum in Brisbane today.

Mr Rudd said the tax credits would be made in yearly instalments over a 10-year period as part of a national rental affordability scheme.

He said the scheme would be ongoing after an anticipated 3500 new properties were built in the 2008/2009 financial year.

The plan would eventually double the national stock from 50,000 to 100,000 rental homes, he said.

Mr Rudd also announced a $500 million housing affordability fund to tackle rising infrastructure charges and planning delays plaguing local governments.

The Government would invest $30 million to upgrade information systems to speed up approvals processes.

State and territory governments have agreed to provide $2,000 a home either through cash payments or in kind, such as via the provision of cut price land or concessions on stamp duty...

(continued on site)

 

[pepperoni]

Citibank now has an 8% pa at call account ... bwahahaha. We should rename the thread money prices to keep rising for years.

And thats without 60k stamp duty and 30k agents fees. And it doesnt require you to waste saturdays house hunting or getting properties ready for open houses. No property management fees, plumbers, delinquent tennants, land tax bills, strata levies, special levies and all the other costs moronic mum and dad property investors conveniently overlook.

And being "at call" it doesnt require dealing with a greasy re agent, 8-80 week for sale period, low balling buyers, conveyancers, and 6 week settlement period.

Life is too short for all the nonsense that comes with property investing ... Even if the returns were good (which they arent) Id gladly get a lower return with less running around. You only live once and have to put a value on your time people!

 

[robots]

hello,

go for it peepperoni,

i like to listen to the authority on these issues like the ABS who document that home owners worth 6x more than renters, a HUGE 6x

no-one stopping you from doing as you please, goodluck

thankyou

robots

 

[nioka]

Life is too short for all the nonsense that comes with property investing ... Even if the returns were good (which they arent) Id gladly get a lower return with less running around. You only live once and have to put a value on your time people!

Ah! The young and the restless. Maybe it should be the young and the reckless.

 

[pepperoni]

hello,

go for it peepperoni,

i like to listen to the authority on these issues like the ABS who document that home owners worth 6x more than renters, a HUGE 6x

no-one stopping you from doing as you please, goodluck

thankyou

robots

Because historically people who bought houses could afford them but with the recent credit bubble you and the other robots are forming the new home owner poverty class.

A period of house sales in melbourne (of all places) at 20% above historical averages towards the end of a credit bubble does not mean house prices are increasing to that extent.

Have fun wasting you life at auctions while the rest of us live the high life

 

[pepperoni]

Ah! The young and the restless. Maybe it should be the young and the reckless.

Errr ... getting an education and earning a solid 4 figures a day is hardly reckless .. flittering around auctions with money you dont have in the hope of making 4 figures a day is though.

 

[pepperoni]

Adelaide Bank ups rates by 0.4%
Email Print Normal font Large font AdvertisementMarch 5, 2008 - 2:56PM

http://business.smh.com.au/adelaide-bank-ups-rates-by-04/20080305-1x3u.html


In related news, return on property investments has fallen by around that much depending on gearing (but ignoring the dampner this will be for capital gains).

 

[MichaelWhyte]

Hi Guys,

Just put the rent up on my IP by $100 from $550 to $650pw. Not much more to add really. Just an 18% increase from where it has been for the last 6 months. I'll probably go again in 6 months time too. She's almost neutral now, and if rates come off a bit she will be. I think I factored that I need 1%pa Capital Gain to offset my negative holding costs. Of course, that would need to be above inflation if it is to be an effective store of wealth.

But I'm gonna hold. Its in a seachange suburb in a saught after part of Sydney that's been doing 8% pa growth for the last three years. When the credit squeeze washes out, this postcode will do a lot more than 8%.

Oh, and every 10% growth adds $270K to my net worth. Oh, and don't do the math on yields as its a leveraged play so they won't add up. Its a bit like a stock option as its a DA approved site that I'm holding for a fraction of its actual Gross Realisation potential.

Its not all doom and gloom in IP land.

Cheers,
Michael.

 

[pepperoni]

Hi Guys,

Just put the rent up on my IP by $100 from $550 to $650pw. Not much more to add really. Just an 18% increase from where it has been for the last 6 months. I'll probably go again in 6 months time too. She's almost neutral now, and if rates come off a bit she will be. I think I factored that I need 1%pa Capital Gain to offset my negative holding costs. Of course, that would need to be above inflation if it is to be an effective store of wealth.

But I'm gonna hold. Its in a seachange suburb in a saught after part of Sydney that's been doing 8% pa growth for the last three years. When the credit squeeze washes out, this postcode will do a lot more than 8%.

Oh, and every 10% growth adds $270K to my net worth. Oh, and don't do the math on yields as its a leveraged play so they won't add up. Its a bit like a stock option as its a DA approved site that I'm holding for a fraction of its actual Gross Realisation potential.

Its not all doom and gloom in IP land.

Cheers,
Michael.

With a 1% capital gain you break even!!!!!? Its not exactly bright sunny skies either!

And how long have you had 90% of your eggs in this basket? And how much longer will you need to before you can take the hit that comes with selling?

IMO it starts looking real doom and gloom when you consider alternative investments.

And Im not too sure capital gains will be great. In 1994 as a young full time professional with 300k in assets, no debt, and on 50k pa CBA would only lend me 200k .... since around 2000 Ive seen lenders offering to 350k and more to people on that money. With much higher costs of living.

That and low interest rates account for 99% of capital gain but rates are up and credit supply is on the way down ...


http://business.smh.com.au/macquarie-to-scale-back-mortgage-business/20080305-1x0f.html

Macquarie to scale back mortgage business
Email Print Normal font Large font AdvertisementJacob Saulwick
March 5, 2008 - 11:37AM

Australia's non-bank mortgage market continues to contract after Macquarie Group announced it would substantially cut the number of new mortgages it offers.

Macquarie's decision follows the decline of Mobius, the mortgage business of the embattled Allco Finance, and the sale of most of RAMS Home Loans to Westpac.

Macquarie blamed the higher cost of finance caused by the international credit crisis for the move, but said services to existing Australian customers that hold 95,000 loan facilities would continue.

The heat being applied to mortgage providers that draw funding from international money markets is expected to reduce the rapid pace of lending in Australia.

 

[MichaelWhyte]

With a 1% capital gain you break even!!!!!? Its not exactly bright sunny skies either!

And how long have you had 90% of your eggs in this basket? And how much longer will you need to before you can take the hit that comes with selling?

Still, I'm happy investing in an asset class where all I need is 1% growth to be in the black after all costs are covered... Particularly given the potential for significantly more than this given basic demand/supply economics. In the postcode I'm invested in over 80% of properties are owned outright with no debt outstanding. And the median price is well over $1M. Who cares what happens with global credit markets when you can pay cash for properties at well over the $1M mark...

And, as for the "hit", I'm actually up already to the tune of some $300K profit over my purchase price of 18months ago (or a 28% annualised return over that period. That's the payoff from getting my DA approved). So, even selling today I'd pocket a nice little margin. No downside there...

Horses for courses, but property is a good game too if you know how to play by the rules. I don't expect there to be as many property experts on a stock forum though as there are stock experts. Its a different game, but a profitable one for those that know how to play it.

Cheers,
Michael.

 

[pepperoni]

.. and 8 months into the credit crisis mac bank says there is absolutely no sign of it abating.

Others have good cause for expecting it to worsen.

http://www.telegraph.co.uk/money/ma...1YourView&xml=/money/2008/03/03/ccview103.xml

Interesting to note that house prices are flat or going backwards in most of the developed world ... which presumably doesnt include melbourne.

Consider the fundamentals and ignore the bubbles caused by fools that are cashed up with other peoples money.

Continue with the ignorant bliss at your own peril.