House prices to stagnate for 'years'

[robots]

hello,

wow another cracker on the all ords, dow, hang sunk, nikkei today

fantastic stuff, great to see property here in aus still rolling on,

things will work out in the UK

thankyou

robots

 

[lusk]

hello,

wow another cracker on the all ords, dow, hang sunk, nikkei today

fantastic stuff, great to see property here in aus still rolling on,

things will work out in the UK

thankyou

robots

You are assuming that you can't make money when the markets go down, l'll stick with stocks thanks

 

[numbercruncher]

hello,

wow another cracker on the all ords, dow, hang sunk, nikkei today

fantastic stuff, great to see property here in aus still rolling on,

things will work out in the UK

thankyou

robots

Hello,


147bn vaporised on the ASX this year so far.

Pleased to see you think its fantastic, 147b could buy alot of overpriced realestate, guess it wont be now

Thankyou.

 

[tech/a]

Had dinner last night with 4 Real estate agents and 4 developers.Clearance rates are with these 4 averaging 85%.

Average increase in development property from time of doing the numbers to completion 15%.From the 4 at the table.

Much excitement over the new Super laws to allow use of equity for property purchases through SMSF.

It seems obvious to me that those who aren't "In the property market" place negative view on property in this thread and those who do (Except for Wayne) don't.

 

[numbercruncher]

Hi Tech,

You havnt been following the thread very well, there are tons of people in this thread who are in the property market and have negative views on its outlook. Just because someone owns a piece of dirt doesnt automatically make them a RE one-eyed permabull.

Have a read through, plenty of examples of RE rising/falling , something for everyone.

Plenty of action in Equity markets, if they deteriorate much further you would have to be naive to think it wont effect RE.

Ominous warnings abound, RE crashing US and Europe , major trouble in Equity markets, Australia most unaffordable RE market in world on income to price basis - But everyone needs somewhere to live obviously.

Im glad to hear you and your RE/DEV buddys are creaming it, they must still have easy access to credit, some organisations are sweating the credit part.

Cheers.

 

[wayneL]

From one of the main Sunday Papers here:

 

[chops_a_must]

From one of the main Sunday Papers here:

What does Johnny Depp have to do with house prices crashing?

 

[wayneL]

What does Johnny Depp have to do with house prices crashing?

Uhhh, nothing, just highlighting the appropriate bit for the thread.

Slovenly highlighting on my part.

 

[grubadoo]

What does Johnny Depp have to do with house prices crashing?

Hilarious, you gave me a good laugh. By the look of the cover it looks like the world is coming to an end. Oh well at least you get a free DVD.

 

[Tysonboss1]

What does Johnny Depp have to do with house prices crashing?

lol

 

[Tysonboss1]

From one of the main Sunday Papers here:

Lucky I am not investing in english property.

 

[wayneL]

Give me time... I'll dream up some BS socionomic link between the two.

The Depp indicator???

 

[numbercruncher]

How about the Deppernator "Hasta la vista Permabulls"

 

[wayneL]

Lucky I am not investing in english property.

Nonsense! English property is a wonderful investment........ when bought at value

Prime English property at value can be positively geared, something that can rarely be done in Aus unless you go bush.

 

[tech/a]

Nonsense! English property is a wonderful investment........ when bought at value

Prime English property at value can be positively geared, something that can rarely be done in Aus unless you go bush.

Wayne Wayne.

Its simply a matter of equity in the property you purchase.
Gone are the days (For many years) where positive gearing on 10% is possible,but not positive gearing.

 

[wayneL]

Wayne Wayne.

Its simply a matter of equity in the property you purchase.
Gone are the days (For many years) where positive gearing on 10% is possible,but not positive gearing.

Yes of course, but the standard formula has aways been 10 or 20%. That's what I'm referring to

But my view is that this is a temporary situation... a view that is shortening in odds rapidly... (here at least)

Cycles

 

[tech/a]

Well that's why every time I visit this thread I find myself shaking my head in disbelief.

If anyone is seriously involved in property they will be geared to a degree which will mean that rate rises are taken care of by increases in rental.

They will search out opportunities which will leave them geared to an extent where they wont be under pressure from rate rises OR downturns.

Downturns simply don't fit into my own equation.
As my equity ratio is low enough to cover land value.

Cover land value and the rest takes care of itself from an Armageddon stand point.
As mentioned people have to have somewhere to live and if you cover costs of holding then what's the problem?

Its pretty simple.

Fantastic if there is a massive drop.
(1) I'll be able to buy more in-line with land value as I'm looking for pushovers anyway,the dwelling is of little consequence.
(2) Builders will be screaming for work,I'll be able to squeeze better pricing.
(3) Renters will abound,they are falling over themselves now---even out bidding rent offers to get a dwelling!
(4) Most developments I do are 70% geared initially with 25 -30% in them. Normally 4 in a duplex.
(5) Sell 2 and gearing comes back to parity with land price.Equity is increased and rents cover rate increases. 3 even better.
(6) In a few years de to rent rises you have a passive income.

Seriously I don't see what all the fuss is about if your seriously involved.
Market conditions are just a part of business---so take care of business.

 

[numbercruncher]

If anyone is seriously involved in property they will be geared to a degree which will mean that rate rises are taken care of by increases in rental.

So the average House asking price is 400k, it rents for $400 a week , standard mortgage rates are 8.5pc, what level of gearing does your calculator say an Investor entering the market should have ?

 

[tech/a]

So the average House asking price is 400k, it rents for $400 a week , standard mortgage rates are 8.5pc, what level of gearing does your calculator say an Investor entering the market should have ?

Around 45%

 

[tech/a]

Hows Mexico Sound?

http://money.cnn.com/2008/01/20/news/international/bc.apfn.la.fin.mexico.housing.ap/index.htm