I can afford a house

[Mousie]

Just which planet are you on?

Living within your means, who does that?

You've got to go get the huge mortgage for the house you'll never be able to pay off, because, well everyone else is doing it...

LOL Kimosabi, you aren't serious are ya? Coz if you aren't better add a little smiley just so I know who's kidding who

I'm gonna buy my house with 100% CASH. You read that right: CASH DOWN, else NO HOUSE. My investments will pay for that, so I ain't gonna live within my means by then.

 

[tech/a]

Why not just pay rent until everything goes belly-up? The boom ain't gonna last forever, you know.

Well it just isnt going to happen (on a broad scale).
Housing has always been expensive at the time of purchase.

Why didnt you all buy houses from 96 to 2001? They were cheap then.

My first home as a kid was $30,000. In the same area they are now $300,000.

There is absolutely no point in offering advice on this board even if it comes from 30 yrs experience in the Property arena.
As usual the kids know everything---I was once a kid and I knew everything.
Kris reminds me a great deal of myself.
Rebellious towards my Family---nothing changed there in my camp.
But my old boy told me to buy 2 Pieces of Esplanade Land for $6k each back in 75. I told him he was a nutter.

Id have well and truely owned them by now and they are worth $400K for only half the size block available then. They were 24m x 40m now they are 12m x 40m

Thats $1.2 million. Took me another 20 yrs to realise he wasnt a nutter after all---Oh he bought one and later sold it for 24k 400% return was amazing in those days.

Question.
Why do people ask for advice (not that you did directly Kris) then shoot down those with experience who offer it up?

I'm suprised how often I see resentment toward anyone who even mentions wealth of any sort.
Its like they are the enemy--they shouldnt be allowed to "Exploit" opportunity.
Let alone talk about it.

Is it that you just want to moan and bitch? Cut down those who have taken advantage of opportunity.?
Rather than learn from these people you just want them to shut the hell up!.


For people who want to get on in life---you have a very weird way of gaining experience. There are some smart people who actually take the advice and APPLY IT.

I know of someone who spent a little time with someone not unlike some here and recieved a sizable gift from a member on one of these boards in appreciation for turning the "Switch on" and gaining $420,000 increase in his own managed fund over the year 2005/2006.

Each to their own---knock on!---Your life.
If your happy like Kris thats really all you can ask for.

 

[ROE]

Here is a test for non-believer..

ask all those financial advisers who said renting is better than buying and use that extra cash and invest and you get better return...

ask them if they own a home? or paying it off and you pretty close to get to 100% of them owning their own home or buying one..The one that don't probably cant afford one

so if it is sooooooo good the way the sale pitch sound why they all end up owning their on home? hmmm...?
owning a home has other benefits not just financially..
1. Force saving, good discipline
2. you live where you want to live and how long without worrying about landlord kick you out because they want to sell the place or worse dont like ya.
3. you free to upgrade, change do whatever you want to your place to make it more comfortable and increase value without asking for permission.

and on it goes with the list.

If I have to start again and doesn't matter how expensive the home may be I still want to save and buy my own place.

If there is a will, there is a way..don't be discourage by the high price and market force...Control what you can and thing you cant control go with the flow and work your way in.

 

[ROE]

Home ownership is nice under most circumstances...at the right price!

At the wrong price it's hell.

Value investing 101.

House price usually move with inflation, and the thing about house price is
it's either gone through a huge boom and stay flat for a while or sometimes drop a few % here and there but never a sharp drop like 30-40% unless
of course a depression arrive or some other bigger force come into play, in this case the stock market inst safe either.

Many people been waiting since 2003 for a price drop? anything happen?
house price still going up is most cities, only very far out suburb get price drop. Close to CBD properties are still selling like hot cakes, dont believe me check the ABS stats...Canberra house price up 9% last year, most other cities around 4%-7%

 

[tech/a]

Home ownership is nice under most circumstances...at the right price!

At the wrong price it's hell.

Value investing 101.

PRICE has nothing to do with it.
Due diligence from the party purchasing from the point of veiw of affordability will ensure stress OR stress free ownership regardless of price and regardless of TIME.

Sensible investing 101

 

[Mousie]

PRICE has nothing to do with it.
Due diligence from the party purchasing from the point of veiw of affordability will ensure stress OR stress free ownership regardless of price and regardless of TIME.

Sensible investing 101

tech/a,

I'm surprised to see this comment from you to say the least. How can you say that price and time's got nothing to do with due diligence? When doing DD you have to consider price and all other relevant info, which time of purchase/settlement and especially price are undoubtably two.

 

[tech/a]

tech/a,

I'm surprised to see this comment from you to say the least. How can you say that price and time's got nothing to do with due diligence? When doing DD you have to consider price and all other relevant info, which time of purchase/settlement and especially price are undoubtably two.

Well firstly take it in the context of Wayne's post.

Home ownership is nice under most circumstances...at the right price!

At the wrong price it's hell.

Value investing 101.

Correct me if I'm wrong but this statement says that price will govern happiness.

I dont agree.

GEARING WILL.

A 1 Million $ property that was once a $1.4 million property is possibly a real bargain.

To clarify as an example only.

Purchaser "A" earns $60K a year and has to borrow the lot and his wife has to work.He is 90% geared.

Purchaser "B" is the same as "A" but has sold 2 IP/s to free up $700K in equity to put towards the Million dollar bargain. He is geared 30%

The same example can be used on any property value---where Purchaser "A" is fully geared and Purchaser "B" is much lower in gearing.

How important is price?------101

 

[Mousie]

Correct me if I'm wrong but this statement says that price will govern happiness.

I dont agree.

GEARING WILL.

A 1 Million $ property that was once a $1.4 million property is possibly a real bargain.

To clarify as an example only.

Purchaser "A" earns $60K a year and has to borrow the lot and his wife has to work.He is 90% geared.

Purchaser "B" is the same as "A" but has sold 2 IP/s to free up $700K in equity to put towards the Million dollar bargain. He is geared 30%

The same example can be used on any property value---where Purchaser "A" is fully geared and Purchaser "B" is much lower in gearing.

How important is price?------101

Of course the price quoted has to fit the purchaser's situation. Even if a house is cheap compared to other houses, if you can't afford it (either with gearing or not) that's just too bad, wait till you get richer or wait for a handout.

Gearing level is something the purchaser chooses and if things go haywire they have to live with the consequences. And don't forget the amount of interest you pay is dependent upon the price you pay - differences in gearing between purchasers A and B is just the amount of debt each is accepting.

I personally am not comfortable with any level of gearing at all - why pay interest and be at the mercy of the govt when I can have enough to invest and live debt-free? Note that I only make this statement if I think I can live "happily" with the leftovers to invest in whatever I wish to. If I'm not happy, no house for me (yes, even if it's cheap compared to other houses), plain and simple.

 

[tech/a]

Well that may suit you and fit well within your comfort zone.

It will also restrict you.
Any who have been or are in business will be glad to accept debt.
Those who are professionally involved in Property will also be very happy with debt.
Professional or serious traders also have no problem with debt from gearing sensibly at times.

There is proper use of other people's money and incorrect use of debt (good debt/bad debt).

Interest when correctly used can be massive help rather than a hinderance/cost.

 

[Mousie]

Well that may suit you and fit well within your comfort zone.

It will also restrict you.
Any who have been or are in business will be glad to accept debt.
Those who are professionally involved in Property will also be very happy with debt.
Professional or serious traders also have no problem with debt from gearing sensibly at times.

There is proper use of other people's money and incorrect use of debt (good debt/bad debt).

Interest when correctly used can be massive help rather than a hinderance/cost.

Agreed. I'll only adopt this stance when it is not restrictive to my investment capabilities. I'll only use debt when I need to move especially decisively to seize a sure-fire opportunity, and my house is not one of them; at least not atm.

 

[tech/a]

Excellent.

 

[wayneL]

Well firstly take it in the context of Wayne's post.





Correct me if I'm wrong but this statement says that price will govern happiness.

I dont agree.

GEARING WILL.

A 1 Million $ property that was once a $1.4 million property is possibly a real bargain.

To clarify as an example only.

Purchaser "A" earns $60K a year and has to borrow the lot and his wife has to work.He is 90% geared.

Purchaser "B" is the same as "A" but has sold 2 IP/s to free up $700K in equity to put towards the Million dollar bargain. He is geared 30%

The same example can be used on any property value---where Purchaser "A" is fully geared and Purchaser "B" is much lower in gearing.

How important is price?------101

Tech,

There are a myriad of other factors implicit in my post. They are obvious by the bulk of my other postings on this topic and are obvious to all except those who refuse to see. This renders your reply to my post totally irrelevant to the context it was written in.

I won't bother explaining....again.

Cheers

 

[robots]

hello,

whats actually been happening to house prices, anybody know?

thankyou

robots

 

[Smurf1976]

hello,

whats actually been happening to house prices, anybody know?

thankyou

robots

I can only speak for my local area but for a 3 bed brick house prices have gone down for the same or a very similar property.

 

[tech/a]

This renders your reply to my post totally irrelevant to the context it was written in.

Well my apologies then --- as I dont read every post on the board then I guess Ive lost the point your making.

Anyway Ive made my point with relevance to price.

Below a snap shot to dec 2006.
Hardly plummeting and still great gains over 2006.

 

[wayneL]

Glancing through this thread again....lol some doosies.

"Property is always expensive at the time"

While rarely can people just break open the piggy bank and go and buy a house, there are times when property is damned cheap. In '2000 we were looking at a flat in Basingstoke UK for 35k renting out at 350 per month, the average dustmans wages (the demographic who would live in such a place) at the time were about 13k.

Same flat today is 130k, dustman wages now about 14k.

The dustman could easily afford the flat in 2000 with a normal deposit and a mortgage. The dustman now has no hope in hell of buying that dingy crappy flat.

So.... was the property expensive in 2000? No, it was easily affordable for the intended demographic. Is it expensive now? Ludicrously so. Out of reach for the intended demographic.

Why???

The answer is dotted throughout this forum, as are the consequences, both current and possible future ones.

Motivation for my line of argument - Social and eventual economic impact. Listen, I've got every reason for wanting the boom to continue, but I care about the world and society we live in and the current circumstances will have consequences unforeseen by the permabulls... some are showing up now. Links on my other computer.

More when I get time.

 

[wayneL]

http://news.sky.com/skynews/article/0,,30400-1256664,00.html

BoE Takes Property Blame

The group that decides the interest rate deliberately fuelled a consumer boom to boost house prices and personal debt so that "UK Plc" could avoid recession.

Former governor Edward George said the Monetary Policy Committee "did not have much of a choice" in the matter.

The MPC members were battling to use interest rates to prevent the UK being dragged into a worldwide economic slump, he explained.

And, he said, his legacy to the MPC - which decides the rate - was to "sort out" the problems that policy had caused.

Lord George - who headed the Bank for a decade until June 2003 - revealed that he knew the approach was not sustainable as he gave evidence to a committee of MPs.

The terrorist attacks on the US in September 2001 caused a stock market crash in the US, and a sharp fall in the global markets.

Advertisement

"We only had two alternative ways of sustaining demand and keeping the economy moving forward: One was public spending and the other was consumption.

"We knew that we were having to stimulate consumer spending; we knew we had pushed it up to levels which couldn't possibly be sustained into the medium and long term.

"But for the time being, if we had not done that the UK economy would have gone into recession just as has the United States.

"That pushed up house prices, it increased household debt ... my legacy to the MPC if you like has been `sort that out'."

"We tried very hard not to do more than we needed to keep within the inflation target limits but we knew that that was going to cause problems later on which are still with us."

Concerns have been raised that the present official rate of inflation does not reflect the everyday experience of many voters.

 

[tech/a]

Ummm.

Is this a discussion based around UK housing?
I've seriously missed something in this thread.

Ive completely missed where Stop the Clock was now able to purchase a home in the UK.

Interesting that UK housing material is being used to support an arguement for the Australian Housing scene.

 

[wayneL]

Ummm.

Is this a discussion based around UK housing?
I've seriously missed something in this thread.

Ive completely missed where Stop the Clock was now able to purchase a home in the UK.

Interesting that UK housing material is being used to support an arguement for the Australian Housing scene.

There is correlation in the Anglo markets. i.e. US, UK, Oz, Ire, NZ. The same conditions afflict all.

I just happen to have more UK material at hand.

 

[Bronte]

I can only speak for my local area but for a 3 bed brick house prices have gone down for the same or a very similar property.

According to recent bank valuations land / property in our area is still going up.