Australian (ASX) Stock Market Forum

You've got buckleys and none of getting a bank to lend you $300k to buy shares with;) IMO this is where tech is wrong too - there are very few bank lenders who will lend small businesses money without property to back it up - I've tried, albeit not very hard, but they all want with houses or commercial property to secure the loan.

Australian financial system is VERY focussed on housing and if the bubble does burst or even deflate a little (5-10%), I reckon there'll be some nervous CEOs around - see CBA is doing a global fly around trying to shore up support from international lenders.

Hahahhahahhahaa *gasp* hahahahhahhahahha a ahahaha aahhahahaa *gag* hahahahhahaaa aahahaaa

Post of the century right there !!

Good old fashioned PROPERTY eh ??? Makes me want to go and buy more after that scintillating insight into how banks work. LOLOLOL :D
 
What kind of coin do you think can be made from shares? Will your 30k invested in shares be equivalent to property? Is the property positively geared? If it is negatively geared ... by how much? What are your tax deductibilities? Is it to be your PPOR or an IP? Will the bank lend you 300k into shares? When you sell your shares or property how are you set up for taxability? If it is to be a IP where is it and how much rent as well as capital gain are you expecting to receive?

PROPERTY HAS THE SAME PRINCIPLES AS SHARES !! Do The research !

Quick question prawn_86. If you have 30k saved is it in shares or cash in the bank?

Indeed it does have the same principle as shares but with a bit of better tax treatment. Correct me if im wrong but essentially all you are doing is leveraging up to buy one asset. In theory you could do the same with a margin loan for share/s.

To answer your other Q's TS:
1. Am currently getting approx 6% pa dividends from my share portfolio. This shouidl increase with inflation as should rents on an IP. Not taking into account any capital gains
2. Negatively geared investment property. About $80 pw negative to start with. Would have it neutral after 1 yr
3. Tax deductibilities are my next step. Talking to accountant tomoz
4. Gross yield on property is 5.2% and ned to look into CG potential further

Im just trying to do the sums and it seems (at this stage before talking to a good aco****ant) very line ball between leveraging into shares and leveraging into property. I guess the major difference is the volatitlity between the 2 asset classes.
 
In theory YES .... margin loan will attract higher rate of interest due to nature of purchase but.

Talk to a good accountant and they will have an opinion completely contradictory to what you went to see them for and you will leave more confused.

Make a decision based on what suits your needs. Volatility is the key. Which way are you leaning? Volatility of shares or what all the Steven Keens are saying of a 40% drop in property?
 
Which way are you leaning? Volatility of shares or what all the Steven Keens are saying of a 40% drop in property?

I dont think it will drop off that much. Maybe stagnate, but pick the wrong shares and it will do the same thing.

To be honest its seeming like six of one, half dozen of the other at the moment, hence i have no leaning as of yet. I guess we have to take the plunge somewhere along the line...
 
You've got buckleys and none of getting a bank to lend you $300k to buy shares with;) IMO this is where tech is wrong too - there are very few bank lenders who will lend small businesses money without property to back it up - I've tried, albeit not very hard, but they all want with houses or commercial property to secure the loan.

Australian financial system is VERY focussed on housing and if the bubble does burst or even deflate a little (5-10%), I reckon there'll be some nervous CEOs around - see CBA is doing a global fly around trying to shore up support from international lenders.

just for the fun of it, can you post up the charts that the CBA are using on their roadshow please..

would love to chat on their very optimistic charts used in their presentation.. indeed its that bad i fear they may actually embarrass themselves globally touting the figures i have seen on their presentation thus far.. be pretty far fetched to assume anyone they speak to will swallow a single word of what they are spruiking..

lol... may be a good signal to short cba..
 
Gearing is perhaps the major advantage property has over equities - the LVRs are higher and the interest rates are generally lower. Even Comm is a few pips cheaper than my margin loan, although portfolio LVRs are similar for those who have the bulk of their portfolio in blueys.

Margin loans are much easier to set up - my last two increases have been done online and were applied within 24 hours.

Don't know why there has to be a pissing contest between the two to be honest.
 
Don't know why there has to be a pissing contest between the two to be honest.

I agree, its just when you are young you need to make a decision to go one way or the other, as savings can only support a deposit, not both a depsoti and a share portfolio.

Im know both have pros and cons im just trying to get opinions so as to help me make my decision
 
I agree, its just when you are young you need to make a decision to go one way or the other, as savings can only support a deposit, not both a depsoti and a share portfolio.

Im know both have pros and cons im just trying to get opinions so as to help me make my decision
I'd argue that investing early will help you obtain a deposit, but everyone has their own tolerances to investment risk and we have enough arguments here already :)
 
I'd argue that investing early will help you obtain a deposit, but everyone has their own tolerances to investment risk and we have enough arguments here already :)

Exactly what we have done, but at some point there comes a time where (for your 1st property at least) you have to cash in those investments and use them as a deposit. We are at that stage at the moment and trying to decide if it is worthwhile from an investment perspective
 
Hello,

dont forget the "home" aspect of it, you can soon kick of the share/trading side of your investment strategy again

thankyou
professor robots
 
sell everything and get your self the hell into the aussie home market

check this one out.. from the cba
Cheers agent, interesting info. I wonder if it it'll spark another circular bulls vs bears debate about medians again, as if the entire home buying population is on a median income & buying property at the average price point?

PS: Interesting to note the CBA is using a 150 basis point buffer for serviceability calculations. The NBLs who securitise teh majority of their loan book tend to use a 200 point margin. I guess when you're holding billions of $$$ as deposits you get to adjust the figures somewhat.
 
Cheers agent, interesting info. I wonder if it it'll spark another circular bulls vs bears debate about medians again, as if the entire home buying population is on a median income & buying property at the average price point?

PS: Interesting to note the CBA is using a 150 basis point buffer for serviceability calculations. The NBLs who securitise teh majority of their loan book tend to use a 200 point margin. I guess when you're holding billions of $$$ as deposits you get to adjust the figures somewhat.

I don't think that is where the debate it. If all is good, then that begs the questions as to why the CBA is resorting to such strategies:cautious::

http://www.smh.com.au/business/debate-rages-over-property-data-20100914-15avs.html

Debate rages over property data
Eric Johnston
September 15, 2010


THE Commonwealth Bank's global mission to reassure investors of the health of the Australian property market continues to attract attention, with claims the bank had been selectively quoting data to support its case.

Investment forums and housing blogs were alive with talk yesterday that an 18-page presentation used by the bank had replaced unfavourable housing affordability figures with data showing housing costs were not out of step with other cities in the world.

One slide compared Australian housing affordability to several cities, citing figures from a combination of the US urban planning research house Demographia and the investment bank UBS.

The slide showed housing in Sydney and Melbourne was more affordable than cities such as San Francisco, New York and Vancouver. But it used UBS data exclusively for the Australian cities, and Demographia data for the overseas cities.

A Commonwealth Bank spokesman dismissed the claims. He said the information in the slide was prepared by UBS and the bank had no input. A UBS spokesman said it conducted a ''bottom-up'' analysis of Australian housing prices relative to income, based on information compiled by the Australian Taxation Office.

By comparison, the Demographia figures relied on Bureau of Statistics data.

The CBA presentation was aimed at heading off mounting concerns that the Australian property market was behaving like a bubble.

Hedge funds have been circling bank stocks betting the market was overvalued and a collapse in prices would cause steep losses for banks.

American investment guru Jeremy Grantham recently said Australia had an ''unmistakable housing bubble'' and prices would need to pull back sharply.
 
Yes great unbiased info from the CBA :D

Not like they have any ulterior motives behind that report..

Not like they would ever dream of producing numbers to suit.

Thats the great thing about facts and figures ...... pick and choose the ones that fit best.

Blessem.
 
Yes great unbiased info from the CBA :D

Not like they have any ulterior motives behind that report..

Not like they would ever dream of producing numbers to suit.

Thats the great thing about facts and figures ...... pick and choose the ones that fit best.

Blessem.

And dont' forget our wonderful Professor there Nunn, those great clearance rates say it all.
 
Hello,

and why cant australian places be more expensive than US, UK, France, or any other joint?

get over it, spread the doom and gloom in those joints when you checking into Walmart for a rocket launcher and a 9mm glock

why do you think the likes of Oprah, Tiger are coming here, groups that havent been out to our shores for 20-30yrs are rocking up

a tribe called quest, bran nu heavies, all sorts

but hey keep listening to failed fund managers who are going to get you 4%/pa over a 10yr period, fantastic performance

how the all ords vs RE medians, pick and choose

thankyou
professor robots
 
hello,

oh, gidday everybody

great day again, just sitting down for some cheese and crackers and thought i would log on to see how things going

looks like we got an "interest rate cut" with how petrol prices are travelling, just amazing, how's that hey

what happened to peak oil, oh well bit more disposable for the properties, regionals looking even better

thankyou
professor robots
 
Oh yeah peak oil, that got postponed... seems that the abiotic oil crowd where right, the earth has a self replenishing core of oil! Amazing eh? Who'd thunk it! :D
 
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