Is the Australian property boom over?

[sam76]

I just read an interesting thread on another forum regarding this.

A huge number of property to be cleared next weekend - people are saying this is the begining of the end of the boom.

Is the writing on the wall for Australian property?

If yes, how will it affect the country

If no, how long are these levels sustainable?

 

[sam76]

Re: Is the AUS property boom over?

ha! I go and check news.com.au after posting this thread and find this...

Victoria sees record number of homes up for auction as clearance rates fall

REAL estate auction clearance rates plummeted to a 52-week low in Melbourne on Saturday, with the dramatic slide attributed to rising interest rates, changes to the foreign investment rules and the downturn for the long weekend.

Of the 135 reported auctions in Victoria's capital city, just 59 sold under the hammer, while there was a total clearance rate of 59.9 per cent.

According to Australian Property Monitors figures, the weekend results in Melbourne were down 22.9 per cent from the same Saturday last year.

http://www.news.com.au/money/proper...rance-rates-fall/story-e6frfmd0-1225879274233

 

[Beej]

The poll is very ill-defined - define boom? Which boom are you talking about? The boom since WWII? The boom since 1970? The boom since 1999? Or the mini boom of 2009?

If the "boom" is over, what does this actually mean anyway? Are you simply asking, "will the strong prices of the last year continue this year?", or are you asking "Will property prices stop rising for the for-seeable future?", or do you expect if the "boom" is over that prices will fall significantly for some time to come?

I haven't voted in your pole because of the above issues!

For what it's worth, what I see is a typical cyclical slow-down of the market after a strong post 2008 rebound. There does not appear to be any great trigger present that would result in any wave of forced selling or a big rise in default rates etc. It's all playing out in a very similar fashion to the early 90s IMO, with 2008/09 being quite similar to 1991/92 in the cycle. So I expect to see a generally stable market for the next 12-24 months, with minimal price increases and moderate falls in some over-bought area's. Auction volume and number of properties for sale will drop off over this period as sellers realise that the market has cooled, and that process is what will put the floor under any downwards prices pressures. Underlying demand is still strong, and will remain see in all market segments, with FHB segment remaining soft for while until we see interest rates stable for a few months or more.

Cheers,

Beej

 

[sam76]

There's always someone who over analyses things on this site, lol

mate it's just a simple yes or no to a question.

Think of it as a mum or dad investor question.

The government will not be basing any decisions on the outcomes of the results.

Saying that, I take your comments on board and thank you for posting.

 

[gooner]

What boom? My place is only worth about 10% more than it was worth in 2003. Mind you it went up 50% from when I bought it in 2001 to 2003.

When it comes to Melbourne, Darwin and Perth, I think there is a long way down......

 

[explod]

The poll is very ill-defined - define boom? Which boom are you talking about? The boom since WWII? The boom since 1970? The boom since 1999? Or the mini boom of 2009?


Beej

I cannot say what the intention of the thread opener is but I take it to mean since the fall of the great depression in the 1930's, that is the scenario overseas, particularly the US and UK which has been brought about by the ponzie of money printing as it did in the 1930's. Australia is doing the same, trying to borrow a way out of the slowdown so guess property here has a very good chance of going the same way.

cheers explod

 

[Beej]

I cannot say what the intention of the thread opener is but I take it to mean since the fall of the great depression in the 1930's, that is the scenario overseas, particularly the US and UK which has been brought about by the ponzie of money printing as it did in the 1930's. Australia is doing the same, trying to borrow a way out of the slowdown so guess property here has a very good chance of going the same way.

cheers explod

In that case the answer to the poll would be "no"! But I'm not sure that's what the OP meant

 

[sam76]

bah!

Now I'm not even sure what I meant, lol

I'm not a property expert at all (and I never will be) but it seems that the GENERAL boom is quickly coming (or has) to an end.

general as in double figure yearly gains etc...

 

[Beej]

bah!

Now I'm not even sure what I meant, lol

I'm not a property expert at all (and I never will be) but it seems that the GENERAL boom is quickly coming (or has) to an end.

general as in double figure yearly gains etc...

If double digit % annual gains is the definition, then the boom already ended in 2008! Then the next one started again in 2009. In Sydney, the boom ended already 7 years ago in 2003, and then a new mini-one just started in the past year as well - could have a way to go that one!

 

[Mofra]

Which sector of the market?
I voted yes as I believe most properties will not appreciate in price in the short term future, but I can't see a large pullback either. AWOTE will outstrip price growth in the near future is my guess.