House prices to keep rising for years

[Spanning Tree]

The IMF claims that Australian property prices are overvalued by 25 per cent and there is a very high risk of a correction.

Source: http://www.theage.com.au/articles/2008/04/04/1207249392771.html?from=top5

The US house prices are failing so rapidly becasue they are such an unproductive country and simply consume more than they produce.
The US became the most powerful country in the world on the back of resources such as oil, wheat etc but since the 70's when they became a debtor nation they have been on a downward spiral.

Are you saying Australia is not a debtor nation?

The US house prices are failing so rapidly becasue they are such an unproductive country

Actually the US is the most productive country in the world.

"DUBLIN, Sept. 3 (Reuters) ”” American workers are the world’s most productive, followed by the Irish, though productivity is rising fastest in China and much of the rest of Asia, according to the International Labor Organization.

"When productivity was measured by the hour rather than by the total number of hours worked, however, Norway, an oil nation, was the most productive, followed by the United States and France, the organization said in a report released over the weekend and published every two years. It mostly used 2006 data."

Source: http://www.nytimes.com/2007/09/04/business/worldbusiness/04output.html

If Australians are this bad at saving now, Id dread to see what happens in a recession or an enviroment of rising Interest rates

The reality is that Australia and America are very similar. The savings rate of Australia today is virtually nothing or negative.

 

[robots]

hello,

wow, my suburb is down 1.2%, i cant believe it

bloody hell 1.2%

thankyou

robots

 

[wayneL]

hello,

wow, my suburb is down 1.2%, i cant believe it

bloody hell 1.2%

thankyou

robots

If that is the official figure, you'll find that the real figure is more in real terms.

This principle has been discussed before i.e. the role of gentrification in established and regenerating suburbs.

Baboom

 

[robots]

hello,

i have been trying to get thru to the help line after getting this news but there is a 3-mth wait, amazing

dropped 1.2% in 3mths

thankyou

robots

 

[numbercruncher]

hello,

i have been trying to get thru to the help line after getting this news but there is a 3-mth wait, amazing

dropped 1.2% in 3mths

thankyou

robots

Is this thread title coming true yet ?

Least your doing better than nearly every other suburb in Melbourne Robi

 

[numbercruncher]

Heres a good example of the Melbourne property crash in action ......

House asking price 500k

http://http://www.realestate.com.au/cgi-bin/rsearch?a=o&id=104688295&f=0&p=10&t=res&ty=&fmt=&header=&cc=&c=75236518&s=vic&snf=rbs&tm=1209193571

New advert, same house, asking 375k, 25pc drop

http://http://www.realestate.com.au/cgi-bin/rsearch?a=o&id=104795387&f=0&p=10&t=res&ty=&fmt=&header=&cc=&c=75236518&s=vic&snf=rbs&tm=1209193571


Plenty of bargains out there property bulls, go rent some ca$h and come on in, the waters boiling

 

[Aussiejeff]

Is this thread title coming true yet ?

Least your doing better than nearly every other suburb in Melbourne Robi

*sigh*

Why is it that everyone thinks if they are in a suburb that has an AVERAGE drop of 1.2% that THEY have actually had a 1.2% drop in the value of their property. It's obvious to a blind freddy like me that these figures are, indeed, AVERAGES - which means at the extreme ends of the range, someone's property has in fact dropped MORE than the average (who knows, the worst in a particular suburb might be down 40%) while the most desirable property sold in the accounting period might have actually risen (who knows, the BEST property in a particular suburb might be up 40%!)

How the hell can anyone determine acurately BEFORE an actual sale that THEIR particular property has actually conformed exactly to the listed AVERAGE?

Robots - you better hope you are in the upper range of desirability - and that the next 3 months data doesn't turn into a 13% drop...!

*sigh*

My $2 rants' worth.....

AJ

 

[numbercruncher]

You dont even need prices to drop to be getting Walloped, stagnating prices at 9.5pc Interest is a walloping in my eyes

 

[KIWIKARLOS]

The IMF claims that Australian property prices are overvalued by 25 per cent and there is a very high risk of a correction.

Source: http://www.theage.com.au/articles/2008/04/04/1207249392771.html?from=top5

Are you saying Australia is not a debtor nation?


Actually the US is the most productive country in the world.

"DUBLIN, Sept. 3 (Reuters) ”” American workers are the world’s most productive, followed by the Irish, though productivity is rising fastest in China and much of the rest of Asia, according to the International Labor Organization.

"When productivity was measured by the hour rather than by the total number of hours worked, however, Norway, an oil nation, was the most productive, followed by the United States and France, the organization said in a report released over the weekend and published every two years. It mostly used 2006 data."

Source: http://www.nytimes.com/2007/09/04/business/worldbusiness/04output.html

The reality is that Australia and America are very similar. The savings rate of Australia today is virtually nothing or negative.

That is not true really australia isn't a debtor nation our people are up to their eyelids in debt but our contry produces big surpluses. Sure we can't keep increasing public debt but we are hardly in the situation of the US where they have trillions of public and government debt.

America may be a productive country in GDP per person etc but those figures are really BS and without looking at alot of other figures mean nothing at all. Even if teh US exported everything it made it would still be unable to balance its trade imbalance and would still be a net importer. Australia is not a net importer. In the US 70% of the economy is comsumer based so.

1. they have huge public debt
2. they have huge government debt
3. Their economy is built around consumption
4. They CAN NOT possibly turn around the balance of trade without manufacturing more or developing significanty more export industries.
5. Huge oversupply of homes and little demand

It's fairly similar situation for england, ireland and spain.

Australia

1. Huge public debt
2. Strong government balance sheet big surpluses
3. Massive export market that will get bigger and bigger. Coal prices up 100% and iron ore likely to be +70%. Not to mention we have cheap abundant energy resouces.
4. Large demand for housing and little supply.

Fact is the only thing making the oz markt downturn is the cost of credit.

the only reason credit is so expensive is because everyone ha just relised that the US is a very risky venture. Their economy is cactus and in all seriousness are they ever going to be able to pay of the government debt let alone the public paying of their housing debts?

People will start looking for more secure investments for the huge amount of developing countriescash out there. We are secure becuse we have resources to back up our public borrowing and our economy is well diversified.

I think that unless you couldn't pay your morgage you would be silly to sell your house now. Go to rental inspections 40 people turn up and many overbid the asking rent. I've even heard stories of people paying a year in advance. Families who can't afford a morgage ATM are looking to rent.

Inflation in oz is really only a big problem becuase of oil and less so food because of our long scale drought. But that looks to be over with a good winter crop on the way.

I doubt oil will go down because there are plenty of countries waiting to pick up any drop in demand.

I personally think we may see a small scall pull back of prices in some areas for the short term but with energy inflation with rolls through the entire economy house prices can only increase with time. The cost of living is rising across the globe as everyone struggles to billions of people are wanting to increasse their standard of living. I believe the asset depreciations in the US are based on the fact that they can't support their way of life where as we are in a good position to actually increase ours.

Seriously 25 million people with something like 30% of the world uranium, 20% of its coal, hgue deposits of iron ore, massive potential geothermal power, big aluminium deposits, probably some of the most prestine fisheries left in the world how are we in anyway near the same boat as the US, England, Ireland or spain ?

 

[Kimosabi]

hello,

wow, my suburb is down 1.2%, i cant believe it

bloody hell 1.2%

thankyou

robots

You haven't seen nothin yet.

I can see house prices halving or going down even more.

hhhhmmmm, what does history tell us.

Australia currently has the biggest housing bubble in our short history, which turns out is even bigger that the United States Bubble.

So watch out when unemployment start heading north.

We've already got massive increases in the prices of Food and Energy along with rising Interest Rates.

This is beginning to look like the perfect "Wipe out the Middle Class Storm" to me.

Now the other thing you people need to understand is how our fraudulent debt based Monetary and Banking Systems work.

I would recommend everyone does some research into Fractional Reserve Banking ==> http://en.wikipedia.org/wiki/Fractional-reserve_banking

Basically the banks can to turn a $1,000 deposit into $20,000 or even more. The only thing is, if we start experiencing massive forclosures and writing off of debts, this will cause DEFLATION of the money supply which will have interesting effects on the rest of the economy.

Everything I'm seeing, is that the United States is going into a Inflationary Depression, watch our kiddies...

 

[Aussiejeff]

.....
I think that unless you couldn't pay your morgage you would be silly to sell your house now. Go to rental inspections 40 people turn up and many overbid the asking rent. I've even heard stories of people paying a year in advance. Families who can't afford a morgage ATM are looking to rent......

Many previous homeowners in the US would have been thinking exactly that way when their own housing bubble was starting to collapse some time ago. At that time, they would have been comfortably affording their repayments and thinking "we can ride out this downturn in house values". Unfortunately, a great many of those same people are now (a) without a job (b) have lost their home through repo or (c) both - and are struggling to keep their heads above the flood waters of bankruptcy. The worry in OZ is that interest rates may continue rising for months on the back of the banks bleating "ooer ... our costs are rising..." regardless of the Reserve Bank's actions. IMO the Reserve Bank has lost a lot of credibility of late and has effectively handballed the economy over to the private banking sector - "Have a fun game, guys!"

Sure, Australia currently has enough employment to keep housing demand bubbling along for private purchases at a reasonable level, but as others have pointed out - woe betide us if China et all have a pull back in demand (through whatever circumstances causes that) for then our exports and consequently our comfortable levels of employment would surely have a marked fall. We would then end up with a BIG drop in demand for either new or existing houses on the market - since those unfortunate enough to find themselves in an unemployed situation (me having been one of those at some stages of my life) generally don't contemplate buying them when on a minimal income! There would be an even worse shortage (verging on a crisis) for rental properties.

Is Australia prepared for this (eg: large public housing projects)? Nope. Again, IMO as we have blindly followed the US lead in most things, I'm sure we can just as effectively fall into a collapsed housing bubble like they did. At least they had years to try and figure out what was happening (and failed). If China alone pulls up stumps (even just a wee little bit) the situation here could slump rather rapidly.

All I can say is good luck and well done to those that currently own their home/flat/unit etc outright!


AJ

 

[juiceman]

You haven't seen nothin yet.

I can see house prices halving or going down even more.

hhhhmmmm, what does history tell us.

Australia currently has the biggest housing bubble in our short history, which turns out is even bigger that the United States Bubble.

So watch out when unemployment start heading north.

We've already got massive increases in the prices of Food and Energy along with rising Interest Rates.

This is beginning to look like the perfect "Wipe out the Middle Class Storm" to me.

Now the other thing you people need to understand is how our fraudulent debt based Monetary and Banking Systems work.

I would recommend everyone does some research into Fractional Reserve Banking ==> http://en.wikipedia.org/wiki/Fractional-reserve_banking

Basically the banks can to turn a $1,000 deposit into $20,000 or even more. The only thing is, if we start experiencing massive forclosures and writing off of debts, this will cause DEFLATION of the money supply which will have interesting effects on the rest of the economy.

Everything I'm seeing, is that the United States is going into a Inflationary Depression, watch our kiddies...

What a sobering post
By combining the chart with information about fractional banking, it’s not hard to see why the US reserve bank is so intent on increasing money supply in their system.
They really had no choice!
Don’t worry about sub- prime, that’s just the tip of the iceberg.
Not many people understand fractional banking, so I would urge our readers to have a look at the web site you suggested.
While your post was about real estate, I feel you should start another thread, give it an appropriate title and see what others think.
I can’t help but feel that the perfect financial storm is still brewing
Great post Kimosabi and can only hope that we are both wrong.
PS. The effects of the 29 crash where not really felt by the average family until 1930

 

[robots]

hello,

been going on for 2.5yrs kimo and presto -1.2%,

i think plenty need to wake up and go and do something different or more productive than reading all the documents on the internet

like inflation it is all so irrelevant

it is great hearing all the predictions, keep it up

thankyou

robots

 

[Kimosabi]

hello,

been going on for 2.5yrs kimo and presto -1.2%,

i think plenty need to wake up and go and do something different or more productive than reading all the documents on the internet

like inflation it is all so irrelevant

it is great hearing all the predictions, keep it up

thankyou

robots

hahaha,

The Aussie Housing Crash officially started when the "Housing Prices to Stagnate for Years" thread was replaced by the "House Prices to keep rising for Years" thread.

When this thread gets replaced by a new thread on Housing Prices to never rise again we know the bottom is in and it's time to start investing in Property again...

 

[numbercruncher]

hahaha,

The Aussie Housing Crash officially started when the "Housing Prices to Stagnate for Years" thread was replaced by the "House Prices to keep rising for Years" thread.

When this thread gets replaced by a new thread on Housing Prices to never rise again we know the bottom is in and it's time to start investing in Property again...

lol thats exactly what I said when this thread started, this was the indicator that it was all about to turn to poo ...

Another scary thing I read, maybe I already mentioned it, is that about 30pc of Aussie mortgages are fixed and the majority reset this year to interest rates some 50pc higher, ouch ...

 

[YChromozome]

You haven't seen nothin yet.

I can see house prices halving or going down even more.

hhhhmmmm, what does history tell us.

And just look at Household Debt to fund those exuberant house prices.



It looks like Australian's have more debt than Americans, not to mention Australian household debt is accelerating much faster than our US counterparts. Have a look at that slope. Hope it's all sustainable.

 

[robots]

hello,

sorry for the delay homies in getting the auction results in for melbourne, i know many look forward to the news

great day yesterday, 68% clearance rate, very very good

next week will be another one to watch, will probably hang around 65+or- a little,

its a pity about "house prices to stagnate for years", although probably like a bad dream for many

thankyou

robots

 

[numbercruncher]

lol Robi, the Melbourne Median has dropped 10pc this last quarter yet you act like it was plus 10, what gives ?

 

[Temjin]

This thread just keep on going on and on and on and on.

It's hard to talk to someone who have a vested interest in the investment they own.

But I love this thread in the sense that a lot of valid and interest information are being put up on one side of the argument (which is obviously bearish) and the other side who have essential little viable evidences for counter-argue except to say that "it hasn't crashed yet! at least not me yet!".

 

[robots]

hello,

only reporting the results NC,

yes another great weekend, hands up those who went to an auction or looked at property over the last week?

sorry, i remember now, like all the finance and monetary experts here at ASF (after they read some internet webpages) you have all read some property pages as well

its like Tech has previously mentioned if you have property you apparently should be committed

thankyou

robots