House prices to keep rising for years

nunthewiser · 1 July 2009

Hi kincela this is a post i stole from another forum

" i just bought a place 6 months ago for 350k 100% lend, i lost my job 2 months ago and have just had to sell it in a depressed market for 280k

i now owe 70k there plus fees plus an extra 100k on cars , boats and credit cards

that FHOG and real estate pump by the goverment sure has a lot to answer to

glad they will let me claim banktruptcy at least

bit hard to get any help from the salvo,s currently tho as it seems that im not the only one in this position at the mo "

thankyou

senior proffessor nun

trainspotter · 2 July 2009

nunthewiser said:
scroll back

i posted that earlier today but the sunshine and glee gang tried to turn it into a lollipop moment .

quite a few indicators turning pear shaped lately but hey never let facts get in the way of a good story

Ooooops. Sorry to you nunthewiser for stepping on your post. Must have been a senior/blonde/stupid phase I was going through at the time. Now there's an opening for someone to pounce on !

Anyways, parts of Australia are showing recovery in the housing sector and other sections are NOT. The ones that aren't, have already been through a capital growth situation and have either hit peak or have dropped away slightly. (my portfolio at the moment)

Different parts of the property market traditionally do well in this almost stagflation environment. Kincella's "friend" is more than likely on the money. Find an old house in a good suburb and give it a lick of paint an replant the garden. Viola !! Instant 50k in some cases. Other cases not so much.

The double post refers to "NEW" construction. Current glut on the market as we wait for the established property to be taken out of the mix. Once purchasers cannot find what they are looking for there is no alternative but to build in the new subdivisions. OR buy on existing leafy/wealthy/inner suburb and completely gut and rebuild an existing property. Remember the three L's in property.

Mc Gusto · 2 July 2009

people clearly feel now is the time to buy. therefore demand is up with supply being moderate to low.
fear factor of jobloss etc has gone. the recession is over. australia has skipped through it unscathed.

Meanwhile...canada getting thwacked. NZ in the poo. UK / Europe / USA pretty messy.

well i never..?@!?!

sunshine and lollipops. no recession here. onwards and upwards.

kincella · 2 July 2009

more reality
the indexes jumped as follows ,and peaked year, population
nz 200 03/04 4 mill
ire 200 07 4
uk 150 03 61
us 150 05 303
ca 150 07 33
ice 100 06 * only 300k's
aus 40 03 and again 08 21 mill
***note how far below aus index rose compared to all the others...a lowly 40 compared to 150-200....
apart from nz and the uk peaked about the same time as aus...all the others were laggards...us in 05, ice 06, ca and ire 07
population of nz and ire about the same as Melbourne only, and ice only 300,000 like one of our regionals...

http://www.globalpropertyguide.com/real-estate-house-prices/A

nunthewiser · 2 July 2009

nsw and qld next ?

WA home repossessions soar

2nd July 2009, 6:45 WST
The number of home repossessions in WA has hit a record high as hundreds of families lose the battle to make mortgage repayments.

The WA Council of Social Service warned yesterday that the situation was likely to get worse before it got better as rising unemployment forced more people to the brink.

http://www.thewest.com.au/default.aspx?MenuID=77&ContentID=152314

sunshine and lollipops ?

just keeping it real man

lasty · 2 July 2009

nunthewiser said:
nsw and qld next ?

http://www.thewest.com.au/default.aspx?MenuID=77&ContentID=152314

sunshine and lollipops ?

just keeping it real man

Interesting, so those who are losing their homes are what income bracket?
In NSW the higher end are losing their homes but managing to fall back into the median market.
Then we see so many losing their homes as claimed by many but prices arent falling, so there maybe vultures waiting to claw their way in.
Lets not jump to panic mode just yet. Certain areas like holiday areas and the high end have been smacked but the middle to lower housing prices are firm.

matty2.0 · 4 July 2009

All I see on this thread is complaining and whining about the "imminent crash" that will "inevitably" happen ... however no data or proper reasoning to back up the argument.

Fact of the matter is there is a shortage of supply and housing stock (since the govt has not made land available) and population growth (and thus household formation) is growing at record pace.
There won't be any crash if the demand/supply imbalance continues the way it is. You can check RP data or APM or any other data broker; rental yields are at record lows still, even after all this stimulus, this suggests that demand is strong and supply is not enough to offset the demand. If it was, then along with govt. grants, we would be seeing yields come off a bit but we haven't.

The only cloud looming over our housing market is unemployment, which is quite low at about 5-6% compared to international levels .

Taltan · 4 July 2009

Matty
I think your right and I expect property prices to stay at current levels over the next twelve months. The reason is that although there are supply issues as you say yields are at record so I would think there is only one way for them to go - up. For that either rents (wages) rise or prices fall. Rents rising seems unlikely hence the current equilibrium between supply shortage and insufficient yields should continue in the short-term.

knocker · 5 July 2009

Big trouble coming in the next 3 months. stay tuned property suckers.

matty2.0 · 5 July 2009

knocker said:
Big trouble coming in the next 3 months. stay tuned property suckers.

What are you suggesting? and what do you base it on?

note: I am in no way involved in the property markets right now.

Bafana · 5 July 2009

knocker said:
Big trouble coming in the next 3 months. stay tuned property suckers.

Can you elaborate please? Am looking to make some purchases over the same period and it doesn't hurt to ehar all the scuttle butt.

MACCA350 · 5 July 2009

knocker said:
Big trouble coming in the next 3 months. stay tuned property suckers.

You're just nasty...........saying that and just scuttling off:

cheers

michael_t_f · 5 July 2009

I went to an auction North Brissie last thursday and was the only one bidding for a 3 bed renovator, I thought there would of been some competition from first home buyers. There are a few people interested but the owner strictly wanted 10% upfront which the agent informs me no one else had!
Also I have noticed the amount of properties for sale on the Gold Coast has risen in the last couple of months. My saved search on RE.com usually brings up around 10 props per day, I'm now seeing 20 plus per day new props for sale.

kincella · 5 July 2009

What happened to the housing slump?
Chris Vedelago
July 5, 2009

The surge in property prices has even the experts perplexed, writes Chris Vedelago.

IT WAS supposed to be the worst property slump in a generation. After a succession of interest rate rises, a sharemarket slump, corporate collapses and the psychological effects of the global financial crisis, 2008 had all the ingredients for a prolonged downturn. Some analysts warned that Australian house prices would fall by as much as half.
Property analysts RP Data-Rismark reported last week that Melbourne has posted the highest house price growth of any capital city in the five months to May, up 5.86 per cent to $469,357. It has now passed the previous peak median price of $465,216 set in February last year.

Residex reports that during the downturn, house values rose in suburbs where the median value was below $360,000, such as Laverton (18.9 per cent), Braybrook and Albion (19.6 per cent) and Broadmeadows (20.8 per cent).
note only extracts here..not the full story
http://business.theage.com.au/business/what-happened-to-the-housing-slump-20090704-d8i2.html

my thoughts on Qld and WA....they rose higher and longer than the other states...so they will see softening...while NSW and VIC are showing growth
I expect all resource dependent states to soften...unbelievable they would be higher than biggest cities of Syd and Melb...

MACCA350 · 5 July 2009

michael_t_f said:
I went to an auction North Brissie last thursday and was the only one bidding for a 3 bed renovator, I thought there would of been some competition from first home buyers. There are a few people interested but the owner strictly wanted 10% upfront which the agent informs me no one else had!
Also I have noticed the amount of properties for sale on the Gold Coast has risen in the last couple of months. My saved search on RE.com usually brings up around 10 props per day, I'm now seeing 20 plus per day new props for sale.

I think it's a bit silly to go to an auction without a deposit and expect to buy the house
Granted I haven't been in the game long but when we sold our house it was standard practice to have a 10% deposit from the buyer on the auction day. Even buying our block of land we had to supply a 10% deposit when we signed the contract...........I wouldn't expect any different.

If you're serious and are planning to bid on a property at auction you'd better have your check book with you...........that's my opinion anyway

cheers

kincella · 5 July 2009

A very interesting article showing the differences between Melb and Sydney, and will explain to the mexicans who live anywhere other than Melb...what keeps melb buzzing along...selected extracts only......
Melbourne comes out on top

AT ALMOST every level, Melbourne business is thrashing its Sydney counterpart ”” and it has been doing so almost from the moment the prawn bike made its grand entrance as part of the Sydney Olympics closing ceremony in October 2000.

More businesses are starting up in Melbourne, growth in economic activity is considerably higher in Melbourne and Victoria generally ”” up to double that of Sydney and NSW ”” infrastructure spending is higher, and while Sydney still captures more tourist dollars, Melbourne is rapidly catching up.

Wages are higher in Sydney but so is the unemployment rate (6.4 per cent versus 5.9 per cent), and while Sydneysiders go home to their average $530,000 houses, Melbourne house prices have been more solid in recent times ”” albeit at $425,000.

The differing economic performance has been reflected in population growth. Melbourne's population is growing at more than double the rate of Sydney's and, if this continues, Melbourne will overtake Sydney as Australia's largest city within the next 20 years.

At the big end of business, the cities are equally split. Sydney is home to nine of the top 20 companies listed on the Australian Stock Exchange, while Melbourne boasts eight, although in BHP, Rio, NAB, ANZ and Telstra they are also some of the biggest
"Senior banking people tell me that Melbourne is going gangbusters and if the rest of the country was like Melbourne, we wouldn't be in recession ”” but Sydney is completely cactus."
Mr Phillips (a Melburnian) describes Sydney as the consummate deal-making town and believes there is still a seamless connection between Sydney unions, the ALP and major businesses there.

"People in business think this situation is normal in NSW but it has ossified decision-making in the state ”” the decisions are politically driven and not market driven and NSW is now the dead lead in the Australian economy."

http://business.theage.com.au/business/melbourne-comes-out-on-top-20090704-d8g5.html

michael_t_f · 5 July 2009

Macca I don't think you read my post properly. My point is that no first home buyers actually have a 10% deposit. This is why I was the only one bidding because I was the only one with the cash. It appears that the majority of fhb are fully dependent on the grant.

kincella · 5 July 2009

Michael. the banks have demanded the FHB have at least 5% of genuine savings, to use with the grant....so maybe they were just lookers....tyre kickers

trainspotter · 5 July 2009

This in the Australian in January - WESTERN Australia's property bubble has been pricked and prices could drop as far as 20 per cent as home buyers flee the market. Turnover in the market has dropped by 16.1 per cent since its peak in June, based on the number of new home loans being approved, with a 4.1 per cent fall in November.

This in the West Australian in July - HOUSE prices on rise again: Industry chief (front page headline) Perth's property market is on track to record its second consecutive quarter of price growth that would confirm the embattled sector has turned the corner. Median house prices to rise by2.3%

Talk about conflicting signals.

MACCA350 · 5 July 2009

michael_t_f said:
Macca I don't think you read my post properly. My point is that no first home buyers actually have a 10% deposit. This is why I was the only one bidding because I was the only one with the cash. It appears that the majority of fhb are fully dependent on the grant.

Yep, I was referring to those who don't yet expect to buy at auction..........Kincella may be right, not about what He's been banging on about this whole thread:, but about them being tyre kickers

cheers

House prices to keep rising for years

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