House prices to keep rising for years

[Warren Buffet II]

hello,

great news in melbourne, auction clearance rate rocketed again yesterday to 66%, fantastic

looks as though things are just rolling along nicely, anybody do any firsthand research yesterday?

landlord's maybe interested to know Harvey's joint has been re-stocked with bunk bed's so get'em while they are available

thankyou
robots

He may be saying the right thing and point to the right situation.....

When you have a fire sale your clearance rates will skyrocket and this may be happening in Melbourne already, I posted an article just before about Brisbane and they are selling 1 property out of 10 each week, so if in 3 or 4 weeks all those people put their properties back in auction for 20% or 30% less, the clearance rate will be magnificent, probably what our friend robots from ANZ says 66%.

Enjoy the ride

WBII

 

[Sean K]

hello,

great news in melbourne, auction clearance rate rocketed again yesterday to 66%, fantastic

thankyou
robots

66% is fantastic?



And, they rocketed?

Again?

Anyone got some facts to say what the usual clearance rates are.

And, is clearance rate an indication of strength?

Perhaps the prices have been lowered to ensure sales...

Or not.

Whatever the case, 66% sounds a little sick to me.

(With absolute no first hand knowledge of the current market in Melbourne.)

Property is booming in Lima!

 

[Macquack]

robots

are you really a top exec in the ANZ home loans and auctions branch?
aj

Aussiejeff, you have blown Robots cover. Is he really the ANZ's senior economist, Paul Braddick who claims we are in for the "mother of all" housing booms.

Here is another Paul Braddick gem - "Houses no different to bananas".

 

[Mofra]

66% is fantastic?



And, they rocketed?

Again?

Anyone got some facts to say what the usual clearance rates are.

Hard to judge against last year's figures as 2007 was such an unusual year, and in any case judging the stregth of the property market via clearance rates alone is akin to judging the performance of a stock by the volume alone.

As a rule of thumb, 75% is average to ok, above is great, anything below 60% is abyssmal - again, it doesn't mean too much without prices, and if anyone has access to a breakdown of how many of the sales were sold after auction as the reserve wasn't reached, they'd be much appreciated.

 

[Tysonboss1]

• First home buyers simply can't afford to prop up the housing market.
• .

Yes then can, They just have to plan and budjet and invest to create a deposit and start small,

Offcoarse you can't arrive at the age of 30 having blowen all your earnings for the last 10years on cars and lifestyle and expect to beable to buy the "Mc Mansion" of your dreams with all the mod cons.

But if you put in place a savings and investment plan from when you were 18, then started off with a modest older 1 bed flat you can easily build a foot hold in the property market.

 

[xoa]

Yes then can, They just have to plan and budjet and invest to create a deposit and start small,

Offcoarse you can't arrive at the age of 30 having blowen all your earnings for the last 10years on cars and lifestyle and expect to beable to buy the "Mc Mansion" of your dreams with all the mod cons.

But if you put in place a savings and investment plan from when you were 18, then started off with a modest older 1 bed flat you can easily build a foot hold in the property market.

Only in the past few years, has the situation emerged where the average worker cannot afford the average house.

It's getting to the point where the average worker cannot afford even the average 1-bedroom flat.

This is a short-term aberration. Understandably, new entrants don't want to sacrifice 70% of their earnings for a "foot hold" on a shaky pyramid scheme.

 

[gfresh]

Come on, even those from Sundan can afford a property on Centrelink apparently..

http://www.smh.com.au/news/national...argets-refugees/2008/07/04/1214951042696.html

 

[xoa]

Come on, even those from Sundan can afford a property on Centrelink apparently..

http://www.smh.com.au/news/national...argets-refugees/2008/07/04/1214951042696.html

A prime example of the "rock solid" lending practices here in Oz.

When I was a kid, I remember when my dad (an engineer) applied for a loan on his first investment property. Even though he had a good income and paid off a large share of his first house, he had to dress up in a full suit, and took two rejections before he got the money.

Now, unemployed asylum seekers can secure a $400,000 mortgage...

 

[Pommiegranite]

A huge proportion of immigrants are/were cashed up Poms.

Should some arrive with some profit from the sale of their homes, does anyone think that they will jump from one crashing market into another?

Maybe someone can ask one of these poor wannabe Aussies:

http://britishexpats.com/forum/showthread.php?t=526748&page=11

I wonder where all of this REAL demand for housing is going to come from.
I wonder who can afford a house for 10x earnings.
I wonder if they will be able to sceure the credit for such a large homeloan.

 

[robots]

hello,

whats considered average clearance is around 65-70% for melbourne,

i think aussiejeff means 34% fraction as well, buts that okay aussie no big deal at my house,

average worker wont be able to afford a can of coke will be written soon with the amount of spruiking coming out of the handout crew,

get a better job, promotion, work 2 jobs, save save save

keep them coming

thankyou

robots

 

[Pommiegranite]

When I first moved to Australia, I was rather 'taken' by the skill with which real estate agents worded their adverts.

However, recently it seems as though the bar is being raised through sheer desperation.

This one is 'penned' so eloquantly that it brings a tear to my eye:bowdown: :

 

[explod]

hello,


average worker wont be able to afford a can of coke will be written soon with the amount of spruiking coming out of the handout crew,


thankyou

robots

Yep we are headed in that direction. In Germany 1924, inflation became so bad that one gentleman of the time said that on a Monday he could cash an empty wine bottle for more than the cost of entire bottle and contents on the Saturday night.

 

[Tysonboss1]

Only in the past few years, has the situation emerged where the average worker cannot afford the average house.

.

Do you think the average person can afford to buy a house and land in Newyork, londan, paris, tokyo, or any other large capital city.... no the average person rents apartments.

Even if you mandated and capped the price of house and land in a city like sydney, there simply wouldn't be enough land for every family to have a 1/4 acre block, the population is just two large, So no matter what happens some one has to miss out and move into high density,

In the capitalist system the first people to miss out are the low incomes, and it slowly moves up the income ladder as the population grows,

XAO, are you saying that it should be possible that an average family should always be able to afford a house and land no matter what the population in the given area is.

 

[Pommiegranite]

Do you think the average person can afford to buy a house and land in Newyork, londan, paris, tokyo, or any other large capital city.... no the average person rents apartments.

Even if you mandated and capped the price of house and land in a city like sydney, there simply wouldn't be enough land for every family to have a 1/4 acre block, the population is just two large, So no matter what happens some one has to miss out and move into high density,

In the capitalist system the first people to miss out are the low incomes, and it slowly moves up the income ladder as the population grows,

XAO, are you saying that it should be possible that an average family should always be able to afford a house and land no matter what the population in the given area is.

Except that every decade or two, 'capitalist systems' have major shakeouts (or recessions), and those who took on too much debt end up the ones who miss out for the rest of their lives.

Property Investors love to talk about their Gross Yields.

However, if we view property as any other business, we see how misleading this ratio can me.

In the UK, one can buy Lloyds shares with a dividend yield of 7.2% & p/e of 5, or property which yields around 4-5% and has a p/e of around 17-22.

Why would anyone bother with the hassles and uncertainty of property, when you can get better yields and no less uncertainty as in the stock market (where we are not at historic highs)?

Its all about minimizing risk and there is simply too much risk about at the moment in buying property today.

 

[xoa]

Do you think the average person can afford to buy a house and land in Newyork, londan, paris, tokyo, or any other large capital city.... no the average person rents apartments.

Australia isn't one massive New York or Tokyo. There might be a case for unaffordability in central Sydney or Melbourne, but what about Adelaide, Newcastle, Cairns, Townsville or Launceston? Or the dozens of other smaller towns which are now considered severely unaffordable? What's fundamentally changed in the past few years to jack up prices, apart from the explosion of debt?

XAO, are you saying that it should be possible that an average family should always be able to afford a house and land no matter what the population in the given area is.

The average family should be able to afford the average housing unit. In some densely populated nations, that means an apartment. In Australia as a whole, it's a house. In a few short years it's been catapulted out of reach. Even a tiny unit is becoming a stretch for the typical first home buyer. I wouldn't want to bet (or invest) on that becoming the status quo.

 

[theasxgorilla]

The average family should be able to afford the average housing unit. In some densely populated nations, that means an apartment. In Australia as a whole, it's a house. In a few short years it's been catapulted out of reach. Even a tiny unit is becoming a stretch for the typical first home buyer. I wouldn't want to bet (or invest) on that becoming the status quo.

Not me either, but on the other hand, pathetically weak investment in infrastructure and very poor town planning means that I can't see it getting easier to find affordable living of standards many still expect to be normal, within a reasonable commute from their places of work.

 

[Kimosabi]

hhhhmmmm, where have I seen this before...

Bonus $3000 Harvey Norman Voucher

http://www.realestate.com.au/cgi-bin/rsearch?a=o&id=105031853&emailsource=emailalert

Oh, that's right, I saw lots of incentives to buy houses in the US a year or two ago, soon it will be cars and holidays but unfortunately the houses still won't sell...

 

[numbercruncher]

Next penny to drop seems to be the Labour market ......

Job advertisements fall across the board

Sunday July 6, 2008, 10:09 am


The Olivier Job Index is now trending down for the first time in six years with fewer jobs advertised in 14 of the 16 sectors surveyed.

http://au.biz.yahoo.com/080706/2/1tild.html


So many youngin's havnt lived through an economic downturn and show complete disrespect for these cycles ......... Which makes me laugh like a cat with a can opener

 

[gfresh]

No surprise if one looks at the ABS figures, but construction activity slowing..

http://business.theage.com.au/building-industry-woes-continue-20080707-32td.html

''The subsequent lower workloads resulting in a reduction in employment for a third consecutive month,'' the report, released today, said.

Construction makes up a large part of the economy. As this slows, the snowball becomes larger and larger. More laid off workers, aren't buying consumer items, struggle to service their debts. How many construction workers have squirreled away for the bad times?

'The 2008/9 financial year will be a flat one at best for new residential construction and this situation will place further pressure on already very tight rental markets, among other negative impacts,'' Mr Dale said.

Personally I think rental accommodation may sort itself out in the coming 12+ months.. Homes can't be sold, investors will soon have two choices - take a lower price on their investment, or rent them out and gather cashflow until things improve. Fresh new rental supply

 

[pepperoni]

Last week was another dismal week on the northern beaches and increasingly in mosman/cremorne/northbridge/castlecrag AT THE BOTTOM.

Middle and top have deen dead for weeks Im told by the agent Im renting off, I just dont spend much time following the market for $3m-$10m properties ha ha.

Having said that the house Im renting for $750 a week is for sale of $4.5m - $5m. There has been one inspection in 2 months.



Interesting recent article ...

" AUSTRALIA'S residential property prices are among the highest in the world.

But most of us still think that prices can't fall. It's time to put that fallacy to the knife, according to Intelligent Investor research director Greg Hoffman .....

property prices in Japan have fallen uninterrupted for 15 straight years"

http://www.theaustralian.news.com.au/story/0,25197,23970724-5001942,00.html