House prices to keep rising for years

[pepperoni]

In the UNLIKELY event, I am a bit more ambivilant on that. Cost of money to the banks are going north due to a growing shortage of the stuff.



Physical gold is up 35% for the year.

Hope you are right about cost of money ... bank initiated increases have stopped for a bit and I was thinking supply was improving considerably.

Good point on gold, had a mate tell me 12 months ago gold would do well but I thought he was nuts.

 

[gfresh]

Good perspective into the UK market Wayne..

Doesn't the UK have fairly high immigration? Did they throw out the same "not enough supply" line a couple of years back? Did they push the fact that rental prices would shoot up due to lack of supply and high immigration? Would be interested to hear if the catch-cry's were familiar.

I heard on the radio here the other day "your own investment property for only $50 a week.. yes.. only $50 a week!" - when you hear that sort of thing you start thinking the party must be ending..

 

[wayneL]

Good perspective into the UK market Wayne..

Doesn't the UK have fairly high immigration? Did they throw out the same "not enough supply" line a couple of years back? Did they push the fact that rental prices would shoot up due to lack of supply and high immigration? Would be interested to hear if the catch-cry's were familiar.

Yeppers!

They were slamming it for all it was worth up until about 4 months ago. (Some are still trying it on, resulting in guffaws)

What they fail to mention is that many immigrants are heading back... especially the eastern Europeans... Poles, Czechs etc. (This is bad news for a lecher )

Also, there are apparently around a million empty properties that people have bought on spec, but haven't put tenants in (in case they soil them ) and lots of holiday properties around the south west and the Cotswolds (my area) that lie empty most of the year,

This could materialize into oversupply... depending on how the economy travels. The game has only just started.

 

[pepperoni]

Funny how spruikers keep claiming our prices will soar while others fall ... somehow we are the only country with growing population and less than infinite housing

 

[Mofra]

I'm starting to believe this "supply shortage" is the last clinging hope for property owners, just as the China story is the last hope for share owners, or the economy in general It keeps getting rolled out by either camp.

Funny you mention that - have 2 people who are (were) looking for rental properties recently, out in the burbs of Melb (where prices are getting hit) there seemed to be a reasonable enough supply of rentals - anywhere inner city and unless you gave the agent a wad of cash & bid over the weekly rental, you couldn't even submit your application. I live 4.5kms from the CBD & rentals are getting stupid, approaching and occasionally exceeding some commercial gross-yields.

 

[wayneL]

According to latest figures, the situation is deteriorating further as the number of mortgages falls to its lowest level since records began... down 56% YoY.

There is a very big London auction being run as I type this (viewing via livelink) and the results are disastrous. The few properties being sold are going at 2001-2003 levels... with the chandelier and the painting of Churchil on the back wall doing most of the bidding.

It's turning into carnage here folks.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/06/24/bcnhouse124.xml

 

[Mofra]

WayneL,

As someone who knows the UK market well, are there any more reputable sites that will show UK resi yields? This site:

http://www.homemove.co.uk/news/24-06-2008/rental-yields-hit-64.html

Is run by a struggling lender which appears to have as much credibility as RAMS.

Cheers

 

[wayneL]

WayneL,

As someone who knows the UK market well, are there any more reputable sites that will show UK resi yields? This site:

http://www.homemove.co.uk/news/24-06-2008/rental-yields-hit-64.html

Is run by a struggling lender which appears to have as much credibility as RAMS.

Cheers

6.4%!! Hohohohoho.... Heheheheheh...Ahhhhaahahahaha

No there is no credible site that I know of that accurately measures yields.

The only way I know is to either find the actual sale price (if purchase was recent) via www.houseprices.co.uk , or determine a reasonable saleable value based on recent sales in the area, and do the sums myself.

Labourious, but accurate.

The house I'm renting, a near new Georgian 3 bedroom townhouse is yielding 3.9% GROSS. My IPs are roughly the same... but was worse based on last years valuation. (Though they were purchased some years ago when yields were fantastic))

Generally, yields range from 3-6% as a maximum... average based on what I know, about 4-4.5%

There is a situation here where yields can be higher, in HMO's (Houses of multiple occupation) i.e. student lets, or big houses where rooms are rented out individually. But costs, voids and hassles are higher. These can be 7-8% GROSS on average. This could be what is skewing the average upwards in their figures.

 

[Naked shorts]

I heard on the radio here the other day "your own investment property for only $50 a week.. yes.. only $50 a week!" - when you hear that sort of thing you start thinking the party must be ending..

You must RUN when you hear that.
sell houses, buy commodities...

 

[robots]

You must RUN when you hear that.
sell houses, buy commodities...

hello,

lets build nothing too, it will be great

can keep pumping up the yield on my investment, just be a zero game as you score on the commodity and hand over to the landlord, fantastic

thankyou

robots

 

[robots]

hello,

http://www.theage.com.au/national/155aweek-lalor-shack-highlights-rental-crisis-20080624-2w6j.html

this is a bargain, plenty of houses in richmond have outdoor toilets and rent for around 3-times that figure,

if I was the landlord i would also put a double set of bunk beds in there (fit them in easy),

thankyou

robots

 

[wayneL]

Wow! Considering that we are only really 6 months in, the headlines are astonishingly bad. That would have caused some indigestion on the tube going home.

http://www.thisislondon.co.uk/stand...iggest+new+homes+crash+in+70+years/article.do

 

[gfresh]

this is a bargain, plenty of houses in richmond have outdoor toilets and rent for around 3-times that figure,

Looks like plenty available in Richmond under $350/wk ($175/wk ea. for a couple, pittance).. less than the average rent up here (not even a proper business centre). Shortage my ass:

http://www.realestate.com.au/cgi-bi...me=50&pxe=350&minbed=&maxbed=&cat=&p=10&o=def

hello, http://www.theage.com.au/national/15...0624-2w6j.html

That article is a load of speculative rubbish!

Since when have you ever been able to rent anywhere decent for $155/wk ?? If we become half-realistic, lots of rentals under $250/wk in Melbourne.. seems like plenty to me.. So who's blatantly lying? The agents putting up dead listings, or the agents from the REIV spruiking a shortage?

http://www.realestate.com.au/cgi-bi...me=50&pxe=250&minbed=&maxbed=&cat=&p=10&o=def

 

[Temjin]

That article is a load of speculative rubbish!

Since when have you ever been able to rent anywhere decent for $155/wk ?? If we become half-realistic, lots of rentals under $250/wk in Melbourne.. seems like plenty to me.. So who's blatantly lying? The agents putting up dead listings, or the agents from the REIV spruiking a shortage?

http://www.realestate.com.au/cgi-bi...me=50&pxe=250&minbed=&maxbed=&cat=&p=10&o=def

Yeah, another stupid attempt by the media to use "selective" property to make their point. How could anyone read this article and then generalise that the entire Melbourne city is in a rental shortgage crisis???

can keep pumping up the yield on my investment, just be a zero game as you score on the commodity and hand over to the landlord, fantastic

Robots my friend, do you even understand the concept of zero game?

Or maybe I can say, the money you received as a landlord will be used to purchase commodities/energy, thereby, bidding up the commodities prices and make us even more profits.

So it doesn't make sense.

 

[pepperoni]

Wow! Considering that we are only really 6 months in, the headlines are astonishingly bad. That would have caused some indigestion on the tube going home.

http://www.thisislondon.co.uk/stand...iggest+new+homes+crash+in+70+years/article.do

Enjoying these UK reports ... Pretty interesting stuff.

Sounds like they are doing a bit worse than aus.

Any idea why they, and the US, are suffering these falls, especially when their rates are so much lower than ours?

It strikes me that Aus could be doing much worse than it is!

 

[Mofra]

The house I'm renting, a near new Georgian 3 bedroom townhouse is yielding 3.9% GROSS. My IPs are roughly the same... but was worse based on last years valuation. (Though they were purchased some years ago when yields were fantastic))

Generally, yields range from 3-6% as a maximum... average based on what I know, about 4-4.5%

There is a situation here where yields can be higher, in HMO's (Houses of multiple occupation) i.e. student lets, or big houses where rooms are rented out individually. But costs, voids and hassles are higher. These can be 7-8% GROSS on average. This could be what is skewing the average upwards in their figures.

They have included HMO's which appear to be the equivalent of our share & mutilple occupancy yields? They'd just about fall under the commercial/non-resi yields in Australia as I understand it.

No wonder their share price is down a whopping 86%

 

[robots]

That article is a load of speculative rubbish!

Since when have you ever been able to rent anywhere decent for $155/wk ?? If we become half-realistic, lots of rentals under $250/wk in Melbourne.. seems like plenty to me.. So who's blatantly lying? The agents putting up dead listings, or the agents from the REIV spruiking a shortage?

hello,

lots and lots of affordable houses in melbourne as well,

perhaps you could do a search on rei.com.au for houses and put them up, or the computer says NO when you want to do that

thankyou

robots

 

[EZZA]

i'm selling off an apartment within 5 km's from melb city, has been a lot of interest, i'm hoping the market hasn't pulled back much, and i can still sell it off for decent price. my assumption is that the market hasn't pulled back too much, maybe it takes a little longer to sell of the properties as interest rates are quite high at the moment.

in terms of rentals and living inner city ur looking at atleast the mid 200's for decent accommodations, imo.

 

[theasxgorilla]

You must RUN when you hear that.
sell houses, buy commodities...

You would have run away from the best parts of the boom with that philosophy. I remember seeing these sorts of things printed on the back of CDs in fish and chip shops in the later part of the 90's.

I don't think this is your canary in the coal mine I'm afraid. In fact from what I remember the fish and chip shop CD was a legitimate tax-effective method for holding an investment property for very little net outlay each pay-cycle and could very effectively be formed into a legitimate investing strategy. I know people who because wealthy from it in fact.

 

[YChromozome]

Weak US house prices fall 23pc - The Australian Business - June 25th.

US house prices dropped 22.8 per cent over the last three months as American consumer confidence slumped.

What happened to house prices only go up?