House prices to keep rising for years

[numbercruncher]

looking we may have highest interest rate in 2009 and 2011 as well ...

http://business.theage.com.au/bracing-for-the-new-china-flu/20080216-1slf.html

High inflation, no more cheap chinese import, Petrol at record high it's building into an atomic bomb

Cash is king save up, go bargain hunting in a couple years ahead...

I've always said Chinas next big export will be Inflation .... looks very close to becoming reality, no wonder they dont want to revalue their currency eh ....

Might be time to stock up on all your cheap Chinese trinkets !@

quote from the article for those who cant be bothered reading link !

AFTER years of filling Australian shops with cheap products, China's latest export is inflation, with the price of goods set to rise over the next six months, economists say.

Soaring energy prices, higher labour and raw materials costs, and new environmental and tax rules are forcing Chinese manufacturers to increase the price of their exports, which, in turn, is being passed on to consumers.

"It's simply demand and supply," said Richard Evans, the head of the Australian Retailers Association.

US consumers are already feeling the pinch as prices from everything from clothing to toys soar ”” some by as much as 50% ”” and economists warn that over the next six months Australian shoppers will also start to feel the impact of higher Chinese prices.

 

[nioka]

Cash is king save up, go bargain hunting in a couple years ahead...

Wouldn't it be better to stock up now on those items expected to increase by 50%. Your cash will buy a lot less next year.

 

[numbercruncher]

Wouldn't it be better to stock up now on those items expected to increase by 50%. Your cash will buy a lot less next year.

Exactly, its time to go mental and stock up on a couple of years worth of presents, bulk supplys , clothes , electronics, gizmos , gadgets etc etc.

Ofcourse this behaviour would be highly inflationary with enough people doing it, but a win win situation, (Might not be so good for people with mortgages on over inflated assets) Get all you goodies at a huge discount and help force some more rate rises to benefit your savings. Im on a spree at dealsdirect as we speak doing my bit of microeconomics, free postage till midnight as well (Im in no way affilated with these folks btw, but they are cheap compared to tomorrows prices)

 

[ROE]

Wouldn't it be better to stock up now on those items expected to increase by 50%. Your cash will buy a lot less next year.

I'm buying everyday when I can Identify stuff that sale cheaper than it's worth.
Few more years when everyone is selling and cant meet their repayment it's even cheaper

 

[explod]

Exactly, its time to go mental and stock up on a couple of years worth of presents, bulk supplys , clothes , electronics, gizmos , gadgets etc etc.

Ofcourse this behaviour would be highly inflationary with enough people doing it, but a win win situation, (Might not be so good for people with mortgages on over inflated assets) Get all you goodies at a huge discount and help force some more rate rises to benefit your savings. Im on a spree at dealsdirect as we speak doing my bit of microeconomics, free postage till midnight as well (Im in no way affilated with these folks btw, but they are cheap compared to tomorrows prices)

Problem with electronic gadgets/gizmos is they date too quick so depreciation could be worse than the inflation.

Try, long life foods, coffee etc, best is 1966 aussie 50cents coins, worth about $7. and rising. or have a good look at the gold thread.

 

[robots]

hello,

yes yes, here we go

summary of today's discussion:

the handout crew still complaining

thankyou

robots

 

[numbercruncher]

Open your wallet Robi .....


I did my little bit for inflation today, you should to

Your not listening to all that anti-Inflation mumbo jumbo from Ruddy are you ?

When do you plan to purchase your next highly geared investment property btw ?

 

[robots]

hello,

I am on the same gig as you NC, save save and save

ride bicycle to work, get a latte and a couple of donouts on the way for inflation


thankyou

robots

 

[Kimosabi]

hello,

I am on the same gig as you NC, save save and save

ride bicycle to work, get a latte and a couple of donouts on the way for inflation


thankyou

robots

What are you saving for Robots, any smart Real Estate Investor should be leveraging themselves to the hilt...

 

[robots]

hello,

I just like to save for an easier life

thankyou

robots

 

[numbercruncher]

I've got this feeling this thread is going to Jinx property bulls ! Just as the other seemingly Jinxed property bears ....

Have the distressed property auctions started?

Thursday, 14 February 2008
James Frost


Rising interest rates are expected to place 750,000 Australians into mortgage stress by June. Inevitably, some of their properties will make their way back on to the market, which could tempt investors. But does distressed property make a good investment?

As sharemarket returns lose their lustre, it’s only natural that investor attention turns to the property market.

Early indications from the Real Estate Institute of Victoria support this; the institute is expecting a jump in the number of properties coming to market in the coming months.

Historically, agents have seen about 700 auctions listed on the average weeks through February and March but this year the levels are soaring. Following a record of 700-plus auctions listed for 23 February, more than 1000 properties are expected to be offered at auction over the following two weekends.

Not all of these sales will be made in the happiest of circumstances. Just as margin calls became a fact of life for many investors in January, the notion of the distressed sale is becoming increasingly common. Figures on mortgagee repossession cases heard by the Supreme Court are on the rise. Between 2005 and 2007 these have risen by 12% in NSW, 35% in Victoria and 107% in Western Australia.

The idea that these sales are just happening in the outer suburbs is just not true, according to Peter Kelaher of PK Property Search and Negotiations. “You absolutely do see distressed property at the top end of the market,” he says. “Often you find that a marriage has gone sour and both parties just want to get out of the property.”

http://www.smartcompany.com.au/Free-Articles/The-Briefing/20080214-Have-the-distressed-property-auctions-started-.html

Seems like a bit of a rush for the door eh ? Bet they all plan to buy back in later at a sexy discount

 

[chatty]

Anyone see anything unsustainable in this equation ?




http://www.news.com.au/business/money/story/0,25479,22717645-5013951,00.html

I should have invested in the property in 1990. 340% up...not bad at all. good return on investment...really..

does anyone here bought investment properties in 1990 and still have it?

 

[Temjin]

Also scary when you see article like this on mainstream news.

http://www.news.com.au/business/money/story/0,25479,23228158-5013951,00.html

What to do if you're about to lose your home

That would scare the crap out of those who are struggling with their repayments.

should have invested in the property in 1990. 340% up...not bad at all. good return on investment...really..

does anyone here bought investment properties in 1990 and still have it?

I'm sure almost every home owning baby boomers here and a number of Gen X ppls have got the bulk of the trend.

 

[theasxgorilla]

Germany is a totally valid example for the point I was making - i.e. that urban planning and high population density do not necessarily equal massive house price rises. Germany also has had relatively high rates of immigration over the past 15 or so years, so in my view it serves as a reasonable comparison.

Tom, thanks for responding to my previous post. You raised some great points.

I agree with your statement (bolded). The reality is that it depends on how it's done. On the one hand your have disgusting high-rise social housing developments where all the immigrants to Germany get placed, and on the other you have the densest borough in terms of people per hectare in London, that being Kensington and Chelsea, which is at the other end of the desirability spectrum.

I think the 37,000 foot view of the situation is misleading. Why would you care about what prices do in the former area if you only plan to invest/live in the latter?

ASX.G

 

[theasxgorilla]

Ireland had received massive amounts of EU subsidies, but they also significantly freed up their economy and reduced taxes.

Sounds familiar. Tick the box for a freed up economy and reduced taxes. Only our equivalent of the subsidies have instead been increasing demand and record commodity prices. Remember, Australia did okay during 'dotcom'. We got progressively wealthy as an acillary beneficiary, but our economy didn't really come into it's own until commodities turned. The Irish, on the other hand, turned their sails to the wind, so to speak, with regards to 'dotcom' and 'biotech', and have been great beneficiaries of this.

Granted the outcome in Australia has not been as extreme as in Ireland, which might explain why the robo-Paddies can emigrate to Australia and still pick up better property for less than it costs for a shoebox in traffic congested Dublin.

The Irish housing bubble is pretty much over now; it's just a matter of how quickly it will deflate. A bit like next door in Britain.

Is that a crystal ball you hold? Shouldn't that read, the Irish housing bubble appears to be be pretty much over, FOR NOW?

Besides, Ireland still retains quite a few places with a lot lower prices than Dublin, which is where the majority of the massive increases in house prices were located. Overall, it is nowhere near as unaffordable as Australia.

Once again, I don't understand why we would we talk about Irish property and purposely not focus on Dublin. Why bother with analysis of their Hicksvilles? Remember, this is still a country that many inhabitants would leave for somewhere warmer, and happier, and with a better standard of living in the blink of an eye. Those areas are more affordable for a very good reason. Compare this with Australia. We're number 3 on the United Nations Human Development Index. You still get more for less here.'

ASX.G

 

[theasxgorilla]

I'm sure almost every home owning baby boomers here and a number of Gen X ppls have got the bulk of the trend.

I think so too. But once again, it's the thing called hindsight. I'd be inclined to say that those of us (me) who were late Gen-Xers, but too early to be full Gen-Yers (thankfully) need to be more daring with our investments. And more nimble too, since we don't know when the music will really stop. Think: exit strategy. And we may not be able to tell immediately that it's already stopped. In which case if you are over-committed it could be be too late.

But to be fair to the boomers and earlier Gen-Xers, their investments during various stages of the cycle must have seemed quite daring. Sure it would have felt good to know that property and interest rates were as cheap and low as they could reasonably expect to be. It would still have felt risky knowing what the market had done the previous 4-5 years. A recession fresh in people's memories, and the fallout of the 80's excesses and stock market crashes still lingering.

They did such a good job sweeping all that under the rug back then I'm confident that whatever happens these next couple of years they'll do their best to accomplish the same thing again. Staying cocked and ready.

ASX.G

 

[robots]

hello,

this is from the Victorian Office for Housing (rental report)

*rents across melb up 12.7% in 12 mths

*inner melb up 13.3% to $340/wk

*nort-east melb up 13% in 12 mths

rents have a long way to go, and would comfortably say that every year now people are going to see these sort of rises

thankyou

robots

 

[Birdster]

hello,

this is from the Victorian Office for Housing (rental report)

*rents across melb up 12.7% in 12 mths

*inner melb up 13.3% to $340/wk

*nort-east melb up 13% in 12 mths

rents have a long way to go, and would comfortably say that every year now people are going to see these sort of rises

thankyou

robots

Where did you get this info from robots? The latest info on rental reports (I could find)is June q. '07 with much lower figures.
link: http://hnb.dhs.vic.gov.au/ooh/ne5ni...570D500101BD60AE2EDFE1A3ADBF9CA25712300816307

I cant seem to find those figures you posted on the site anywhere.

 

[xoa]

Ouch..

Property prices in Melbourne have more than doubled in the past 5 years, but rents have only gone up 14.4%? No wonder rental yields are so abysmal.

 

[tech/a]

ASX

need to be more daring with our investments. And more nimble too, since we don't know when the music will really stop. Think: exit strategy. And we may not be able to tell immediately that it's already stopped. In which case if you are over-committed it could be be too late.

Now your getting to the crux of it.

Most I'm afraid are linier in their outlook and understanding of property and investment in it.
Even the supposedly Financially savvy.

Like the stock market there are times to buy and hold and hold and hold and there are times to be creative---shorter term.
Property is no different.
NOW we have a severe shortage of rentals and high density cheaper units/apartments in closer to city locations and in some cities outer suburb employment based demand.

Developing even smaller complexes can see one with a low risk developement and positively geared result.

Build 4 sell 3 and keep the last either freehold or close to it.Positively geared with rent return and tax benifits.

Just one example,there are more.