House prices to stagnate for 'years'

[numbercruncher]

hello,

here's one NC,

http://www.realestate.com.au/cgi-bi...r=&cc=&c=83553067&s=vic&snf=rbs&tm=1202023409

185k, 38km to GPO

pretty good deal, wow that was hard work

so a labourer on 60k doing it pretty easy NC

any moaners on this one

thankyou

robots

Good example Robots one of the many Melb Suburbs beginning to Crash, yes it is affordable for anyone after a depreciating asset.

 

[robots]

hello,

is the house affordable though NC? yes good one

keep moaning

thankyou

 

[numbercruncher]

hello,

is the house affordable though NC? yes good one

keep moaning

thankyou

You tell me Robi,

Your Labourer mate earns 60k p/a incl super, 55k after super, 40k after tax or 800 p/w.

This trashy house in Melton would cost 400p/w over 20yrs in repayments plus another 50 for rates/Insurance/Maintenance.

Your Labourer mate would have to spend well over 50pc of his take home pay to service it, Mortgage stress is defined as 35pc or more of your income going on housing.

So is it affordable for your mate on above average wages Robi? In one of the Cheapest Suburbs in Melbourne

There is a reason this property you link is "rented for $190 a week", because its a depreciating asset in a trashy area.

Thankyou.

 

[numbercruncher]

A study conducted by Fujitsu Consulting and JP Morgan predicts that as many as 300,000 Australians could be forced to default on their home loans this year.

The study also found that increasing interest rates will mean that about 750,000 households will struggle to pay food and bills, and will be under mortgage related stress.

The predicted default rate has more than doubled since the groups conducted similar research in September and that number will almost certainly rise if interest rates continue their upward trend.

Fairfax newspapers claim that in New South Wales alone repossession rates have risen by 67 per cent in the past 2 years.

Compounding the problem is the fact that many properties are being over-valued at the time of purchase, meaning that even selling properties doesn't necessarily get the borrower out of debt.

http://www.skynews.com.au/news/article.aspx?id=215134

Isnt it high time the Realestate Industry was fully investigated?

Or do we, like the US, wait until after it blows up to start investigating?

 

[wayneL]

London:

http://www.telegraph.co.uk/money/ma...AVCBQWIV0?xml=/money/2008/02/03/cnland103.xml

Property crunch hits British Land

By Jonathan Russell
Last Updated: 11:25pm GMT 02/02/2008

The UK's second biggest property company, British Land, is braced for a £1.7bn hit on the underlying value of its real estate portfolio when it reveals quarterly results this week.
# The latest news and analysis from the construction and property sector
# Land Securities chief Francis Salway on life at the top

Falling commercial property prices, magnified by the company's relatively high debt, could see a 20 per cent fall in its net asset value, according to analysts at JP Morgan. Others are also predicting significant falls: Deutsche Bank expects 16 per cent and Morgan Stanley 13 per cent.
advertisement

JP Morgan analyst Harm Meijer warned that the result could lead to a fall in British Land's share price. He said: "We believe British Land will report a significant drop in net asset value.

Given the recent share price jump and the fact British Land is the first among the majors to report a large decrease, we believe the share price may be negatively impacted this week."

As one of only two FTSE100 property companies to report quarterly figures, British Land's results will be the first to reflect the sudden downturn in prices in the underlying market at the end of 2007.

Valuation experts estimate that City offices, which make up 30 per cent of British Land's portfolio, could have fallen by up to 20 per cent, while the company's retail portfolio will also have suffered significant writedowns.

One expert said: "There is a fundamental problem with the large size of British Land's properties. There is a lack of liquidity in the market for big ticket buildings. The debt financing has gone as have the deep pockets from the investment market. This will affect their value."

Such a fall would take British Land's net asset value per share from £16.82 to £13.50 over the three months to the end of December.

Commentators will be hoping that British Land's chief executive, Stephen Hester, will give the market some comfort over his outlook for the sector. In interim results published in November, British Land said it had £2bn of undrawn banking facilities that it could use to invest in the market.

But with a large unlet development pipeline and the debt ratio set to rise on the back of this week's results, it is unlikely to go further into debt to finance acquisitions.

A rally in property shares since the start of the year has seen British Land and the wider commercial property sector buck the general gloom of the market, rising by over 5 per cent. Its rivals, Liberty and Hammerson, are also due to report in February, but the market is split on its outlook for share movements.

Martin Allen, a property analyst at Morgan Stanley, said: "British Land has a relatively high exposure to the City of London, which we expect to underperform over the next couple of years.

We also expect their two large unlet City office developments to count against them."

 

[Flying Fish]

hello,

check out cfmeu vic site and you can download rates from them,

10% super, reduncancy, site allowance isnt on the page

the latest table is for 06, so proably been some increases from 06

happy reading NC

thankyou

robots

hello

Robots youy are a trade union thug. Just what we need
Thankyou

 

[numbercruncher]

hello

Robots youy are a trade union thug. Just what we need
Thankyou

Excellent!

Union thugs beating out pay rises and adding to inflation and Interest rates.

Game on

 

[robots]

hello,

just trying to help out the brothers FF,

so NC, our labourer just walks in with no cash down

thankyou

robots

 

[robots]

hello,

I think you were saying the other day all the public servants should get the wage rises NC, labourer not good enough?

thankyou

robots

 

[numbercruncher]

Yes everyone earning under 100k should get wage rises, thankyou.

Should and Will are two different things obviously, would need to raise your tax to facilitate this.

 

[robots]

hello,

no need to raise tax,

just get rid of all the departments Australia doesnt need

thankyou

robots

 

[theasxgorilla]

http://www.skynews.com.au/news/article.aspx?id=215134

Isnt it high time the Realestate Industry was fully investigated?

Or do we, like the US, wait until after it blows up to start investigating?

I do like how you selectively quote the article numptycruncher. Of course this is just an article...the paper is not publicly available yet, is it? So we can't see the exact wording of the report. What we have here are interpretations by journalists (insert finger down throat emoticon here). What about this bit right down at the bottom by the Mortgage Industry Association chief:

"Mr Naylor warned people against getting themselves into further debt after they secure a mortgage, claiming that anecdotally, it is credit card debt acquired after a mortgage that is really hurting struggling borrowers."

Those nasty real estate agents bundling free credit cards with houses again I presume?

Or perhaps you really meant to also include this one:

"Phil Naylor, the CEO of the Mortgage Industry Association has played down the research, and says that the figures are based a worst case scenario."

There is always at least two sides to any story, usually many more.

For mine, eventually, when it becomes widely acknowledged (but perhaps not proven a la tobacco and smoking and cancer) that debt expansion and contraction is behind every boom and bust we'll have to stick great big slogans on debt products eg. x Bank's NEW Credit Saver Card, WARNING: taking on excessive debt may harm your unborn babies chances of living in 3br 15 sq. home with a backyard in a nice neighbourhood.

ASX.G

 

[wayneL]

no need to raise tax,

just get rid of all the departments Australia doesnt need

thankyou

robots

Alas, something we can agree on.

 

[numbercruncher]

I do like how you selectively quote the article numptycruncher.

Hello Gorilla

is it not ok to quote the bit of article I am concerned about ?

Compounding the problem is the fact that many properties are being over-valued at the time of purchase, meaning that even selling properties doesn't necessarily get the borrower out of debt.

Properties being over valued at time of purchase has what exactly to do with Credit Cards ?

Over valuing is Fraud in Australia, just like it was fraud in the US.

Thankyou.

 

[theasxgorilla]

Hello Gorilla

is it not ok to quote the bit of article I am concerned about ?

Go for your life. But if the premise that the doom-and-gloom article is based on is shaky at best don't be surprise is eventually someone pulls you up on it.

Properties being over valued at time of purchase has what exactly to do with Credit Cards ?

Over valuing is Fraud in Australia, just like it was fraud in the US.

Where did this "fact" come from? The article, or the report? Or is this a wise-guy journalist trying to join his own dots? Seems like a pretty shaky article to go basing solid beliefs on. Then again, it's from a 'real' news company, and there are two big names at the top of the report, so it ought to be real. But isn't Fujitsu Consulting an IT consultancy company, last time I checked. And I don't recall last time I saw JP Morgan selling residential mortgages in Australia.

Think for yourself.

ASX.G

 

[robots]

hello,

"A rally in property shares since the start of the year has seen British Land and the wider commercial property sector buck the general gloom of the market, rising by over 5 per cent. Its rivals, Liberty and Hammerson, are also due to report in February, but the market is split on its outlook for share movements."

now we get to the truth, people still buying those property shares by the looks of it, strange paragraph in the article

thankyou

robots

 

[numbercruncher]

Surely the onus isnt upon the Forum user to prove the accuracy of a reporters report

More than one source saying it ...

Kim Quick, senior valuer at property advisers Herron Todd White, said increasing numbers of people were stuck in a housing trap where their home was no longer worth what they paid for it because it was over-valued when they bought it.

"A few years ago people were desperate to get on the housing ladder and were convinced that property prices were just going to go up and up," she said.

"Now they can't afford to stay but they can't afford to go either."

In the last few weeks, Ms Quick's company has overseen repossessions of an $800,000 house in Annandale and a unit in the central business district.

Last year, the company presided over the repossession of five neighbouring houses in one street in Kellyville, all within months of each other.

http://www.smh.com.au/news/national/bexclusiveb-mortgage-pain-for-750000-owners/2008/02/02/1201801094694.html

No I cant prove what this Lady says to be true or that the reporter didnt make errors in reporting it, I simply dont have the time.

 

[numbercruncher]

This is from the Housing Industry associations website, 2 rises since this data , another probably next week and probably more later during the year.

Higher Rates Tip More Into Mortgage Stress
Higher home mortgage rates have sent the number of households in mortgage stress soaring since the Census was taken in August last year, according to the Housing Industry Association.



Based on research from the National Centre for Social and Economic Modelling (NATSEM), the HIA has found that 33.2 per cent of all owner-occupiers are in mortgage stress, up from 28.5 per cent in August of last year. In Sydney, more than 41 per cent of home buyers are now in mortgage stress.

http://hia.com.au/hia/news/article/MR/National/EC/Higher%20Rates%20Tip%20More%20Into%20Mortgage%20Stress.aspx

 

[Tysonboss1]

Oh your talking about the small time Muppets ? The Flippers and wannabe property moguls, sure they are the first to be sqeezed out.

Big developers keep pumping out blocks etc as long as someone is waiting to buy, they dont go on holiday for a decade waiting for low interest rates etc.

All I am saying is that the higher the interest rate the less developments get to market, simply because they can't sell them as quickly.

the longer it takes to sell the developments then the longer it takes to get the next project rolling.

For example my uncle has just completed a 26 unit apartment building, 2 years ago he was selling the last units in his developments just as the paint were drying on the project.

At the moment he still has about 1/2 the units unsold, his next project is all lined up but he can't get the ball rolling till he sells another 6 apartments. so not only is his propfit on the whole project smaller because on the extended interest costs, the rate at which the projects are completed is much slower.

so yes interest rates do slow developments.

 

[theasxgorilla]

Surely the onus isnt upon the Forum user to prove the accuracy of a reporters report

Not at all. But whereabouts do I find your insight into these articles you keep posting up for us?

Everyone is giving robots a hard time about alleged real-estate industry ramping, amongst other stuff....I rate his anecdotal stories 1000 times higher in value than this selectively quoted mainstream media garbage.

No I cant prove what this Lady says to be true or that the reporter didnt make errors in reporting it, I simply dont have the time.

So long as you know where you stand. Good for you.

ASX.G