The future of Australian property prices

trainspotter · 12 July 2011

medicowallet said:
1. I do not want to pay CGT , AND as I said before in this thread, to you most likely, I LIKE my properties and do not want to replace them with different ones.

2. You make assumptions that it is business as usual, and that your tennants are making money forever. I have seen many vacant businesses, over the years.

3. Are you suggesting it is impossible for individual properties to drop 30%? Emmanuel Cassimatis thought it was impossible for the sharemarket to drop 40% too, look where that got him, and a lot of experienced investors.

Yes I am suggesting that price could drop substantially, but you know my position on this, as I have clearly stated this before, and, we have had almost this exact discussion before.

We are in an interesting position. You make more money (in percent terms) if prices rise, I lose less money (in percent terms) if prices fall or stagnate.

I am much happier to be in this position over the short to medium term thankyou very much, and even economists such as Saul agree with me at the moment (which worries me )

FYI I never said that we are just like America, I was inferring that they thought it could never happen there too. Of course we are not EXACTLY the same as America, we are in fact only EXACTLY the same as Australia, ever.

1. CGT is only applicable if you purchased property AFTER Spetmeber 20th 1985. Surely you would have purchased them in some $2 company that is a loss making enterprise so therefore there is no CGT applicable? Classic mistake of property. Never fall in love with the real estate. It is a commodity. Sell it now. Buy another. It is business and not a love triangle.

2. My tenants are doing fine thanks. I veto them before they sign the lease. I especially like the ones who pay 12 months in advance.

3. Property has already dropped 40% in some CERTAIN areas. I must have posted this possibilty over 100 times in this thread already. Do you buy shares that have high risk? Do you do any research prior to purchase? Do you understand that the purchase/risk reward ratio is similar? Property is the same.

Bygones. We have locked horns on our position in the market previously. I am happy and you are happy where we both are at.

medicowallet · 12 July 2011

trainspotter said:
1. CGT is only applicable if you purchased property AFTER Spetmeber 20th 1985. Surely you would have purchased them in some $2 company that is a loss making enterprise so therefore there is no CGT applicable? Classic mistake of property. Never fall in love with the real estate. It is a commodity. Sell it now. Buy another. It is business and not a love triangle.

Oh silly me, and here I was thinking that capital gains could only be offset by capital losses.

I guess I'll have to revisit that one.

And even the blue chips dropped significantly during what will probably be known some day as GFC 1.

trainspotter · 12 July 2011

medicowallet said:
Oh silly me, and here I was thinking that capital gains could only be offset by capital losses.

I guess I'll have to revisit that one.

And even the blue chips dropped significantly during what will probably be known some day as GFC 1.

So you are saying you have never made a loss? Not even set up a company that takes a hit for the team come tax time? Man you need to talk to your accountants.

GFC #2 is on the cusp my learned adversary. Late October early November according to the entrails of a recently slain goat. The tide is coming in very quickly for those that have buried their heads in the sand as well as the unfortuante few who have leveraged their way into property.

But if you keep waiting and property falls as you say it will then when it comes time to sell there will be no capital gain old bean !

medicowallet · 12 July 2011

trainspotter said:
So you are saying you have never made a loss? Not even set up a company that takes a hit for the team come tax time? Man you need to talk to your accountants.

GFC #2 is on the cusp my learned adversary. Late October early November according to the entrails of a recently slain goat. The tide is coming in very quickly for those that have buried their heads in the sand as well as the unfortuante few who have leveraged their way into property.

But if you keep waiting and property falls as you say it will then when it comes time to sell there will be no capital gain old bean !

I am limited in the way I can structure my affairs, for various reasons. I even have to my regret partnerships in place, which, I can assure you are the least favourable of entities I have ever been involved in.

Also, my accountant is like some of my properties, aged, but one I'd like to keep. I think he does a good job

See, I don't mind if GFC comes and drops property (I may even buy more, but probably not). I can live with it, unfortunately as you say, many cannot.

I have made plenty of losses, but have no current CGT loss to offset (recently took care of that)

trainspotter · 12 July 2011

medicowallet said:
I am limited in the way I can structure my affairs, for various reasons. I even have to my regret partnerships in place, which, I can assure you are the least favourable of entities I have ever been involved in.

Also, my accountant is like some of my properties, aged, but one I'd like to keep. I think he does a good job

See, I don't mind if GFC comes and drops property (I may even buy more, but probably not). I can live with it, unfortunately as you say, many cannot.

I have made plenty of losses, but have no current CGT loss to offset (recently took care of that)

AHA ! See in your position you are atop a peak. Many are not. They still have a long way to go pardner.

I can relate on the partnership imbibement. I am currenlty involved in several property trusts as well as a strata company. Each individual has a different style or goal. It does not make them right but it sure makes them loud. It is a way of offsetting aproachable losses (if any) as well as spreading debt burden. Risk is minimal but it is not worth the aggravation. On this matter I concur absolutely.

Property will fall in OZ. Has done so already. But I believe it is not the harbringer of doom style but more of a comfortable fart on the couch compared to a complete loss of bowel movement on the front doorstep. 3 - 5 per cent was my call "ON AVERAGE" 12 months ago. Not enough to rattle the penny tin but enough to realise that the commodity has chinks in the armour.

No doubt it will be in the front line in the coming months with some sabre rattling yet to come from banks and their protestations in regard to funding costs irrespetive of what the RBA requires.

All of the indicators you have mentioned will also bring factors into play. The game has got harder but it is still worth playing.

james0909 · 13 July 2011

satanoperca said:
Good Evening All,

Was also out on the bike with my little man on the back riding around the docklands, beautiful evening. New buildings everywhere.

Just caught a week old article thought was of interest.

http://www.theage.com.au/business/fall-in-housing-starts-to-impact-prices-20091110-i7qk.html

Saw Michael Hudson speak at the Melbourne town hall.

Cheers

Thats very interesting!

medicowallet · 15 July 2011

Prices in Melbourne tipped to fall in yesterday's age.

Gold going up last couple of days.

Lollipops and sunshine with a golden lining.

Paradise

MW

kincella · 15 July 2011

Interest rates will go down sooner rather than later...
only mid July and awful retail figures coming out
the rest of the June qtr figures will come by the end of the month...
RBA and banks will start pressing the panic buttons between now and then
2008 revisited again....not sure a drop of 3% is on the cards, but a drop of 1-2% is for sure
the economy was already stalled, but the stupid goose kept chanting, thumpng his chest, how he single handedly had trounced the GFC...stevens followed with a rate rise, and the banks took it a step further, raising above...
so its not only stalled big time...it is crushed, has been since 2008

all those chanting house prices to fall, at the same time rate increases to go thru the roof...unbelievable scenario...pigs will fly ...cannot have both those situations'

as for theage....a very left labor biased rag....they have gone on for a year about house prices crashing...obviously a faulty crystal ball there...'and still they have no evidence...nor proof....
I know exactly what happens...what the trend is, in situations like this....
people knuckle down, tighten the belt, twiddle their thumbs and sit it out.....

a change of govnut, will produce a total change in confidence....then watch a liberal govt bring back the Howard style confidence this country knew...

I think most of the 'housecrash group' are the day traders, how to be an instant millionaire group think tank...there is no longer term thoughts, mind set...for them..
cheers

medicowallet · 15 July 2011

kincella said:
Interest rates will go down sooner rather than later...
only mid July and awful retail figures coming out
the rest of the June qtr figures will come by the end of the month...
RBA and banks will start pressing the panic buttons between now and then
2008 revisited again....not sure a drop of 3% is on the cards, but a drop of 1-2% is for sure
the economy was already stalled, but the stupid goose kept chanting, thumpng his chest, how he single handedly had trounced the GFC...stevens followed with a rate rise, and the banks took it a step further, raising above...
so its not only stalled big time...it is crushed, has been since 2008

all those chanting house prices to fall, at the same time rate increases to go thru the roof...unbelievable scenario...pigs will fly ...cannot have both those situations'

as for theage....a very left labor biased rag....they have gone on for a year about house prices crashing...obviously a faulty crystal ball there...'and still they have no evidence...nor proof....
I know exactly what happens...what the trend is, in situations like this....
people knuckle down, tighten the belt, twiddle their thumbs and sit it out.....

a change of govnut, will produce a total change in confidence....then watch a liberal govt bring back the Howard style confidence this country knew...

I think most of the 'housecrash group' are the day traders, how to be an instant millionaire group think tank...there is no longer term thoughts, mind set...for them..
cheers

Welcome back..

Yes your post is very similar to what was in the news today.

Interest rates are decreasing, I wonder if there is any petrol left in the property tank.

wayneL · 15 July 2011

kincella said:
I know exactly what happens...what the trend is, in situations like this....
people knuckle down, tighten the belt, twiddle their thumbs and sit it out.....

'Cept for those that can't.

trainspotter · 15 July 2011

Job losses are next. Slight downturn in micro economics. Retailers are scared. Term Deposits start to rise. Cash is King. Interest rates are falling. Mortgagee possessions are rising. Ahhhhhhhhh ...... I smell money, the circle of life has turned again.Welcome to the world of property ladeeeeeeeeeez and generalmen.

I just love this thread.

trainspotter · 15 July 2011

medicowallet said:
Welcome back..

Yes your post is very similar to what was in the news today.

Interest rates are decreasing, I wonder if there is any petrol left in the property tank.

Whaaaaaaaaaaaaaaaaaa ????????? Is this why banks have been offering 10 year loans at 8.14% ....... but but but everybody was sure interest rates were going to kill the market ALA Steven Keen style. So this is not an interest rate bubble now? Is it a debt bubble? Hang on ...... if rates go down then it is more affordable.

Be very wary over the next few months as to what job advertisements are doing. If this starts to decline then the fly is in the ointment. This is the kicker. JOBS.

medicowallet · 15 July 2011

trainspotter said:
Whaaaaaaaaaaaaaaaaaa ????????? Is this why banks have been offering 10 year loans at 8.14% ....... but but but everybody was sure interest rates were going to kill the market ALA Steven Keen style. So this is not an interest rate bubble now? Is it a debt bubble? Hang on ...... if rates go down then it is more affordable.

Be very wary over the next few months as to what job advertisements are doing. If this starts to decline then the fly is in the ointment. This is the kicker. JOBS.

Are you making the assumption that going forward, our banks are going to have access to cheap funding?

As I said in the prior posts, there may be a perfect storm brewing. On top of this is Obama having troubles getting extra debt.

Times are interesting, Robots is even having Coffee with Mr Burns.

I agree, our levels of happiness on the employment front are under pressure.

No need to worry, some naive posters believe that rents rise in a compound fashion every year, and have done so forever.... well in their time since weaning a couple of years ago it might have.

I wonder how much new investors will enjoy their negatively geared property if they lose their job and they have to sell.

Have you sold yet?

trainspotter · 16 July 2011

medicowallet said:
Are you making the assumption that going forward, our banks are going to have access to cheap funding?

As I said in the prior posts, there may be a perfect storm brewing. On top of this is Obama having troubles getting extra debt.

Times are interesting, Robots is even having Coffee with Mr Burns.

I agree, our levels of happiness on the employment front are under pressure.

No need to worry, some naive posters believe that rents rise in a compound fashion every year, and have done so forever.... well in their time since weaning a couple of years ago it might have.

I wonder how much new investors will enjoy their negatively geared property if they lose their job and they have to sell.

Have you sold yet?

Negative, Ghost Rider, the pattern is full. This is not what I intimated at all. I suggested that the people who were squawking about interest rates hitting 17% ALA Keating era were soundly misguided. I merely pointed out that banks were availing themselves at slightly above 8% for a ten year fixed period. Hardly the same at all.

Not sure on the perfect storm front though. Obama has debt, Euro has debt, China has debt ....... it will be only a matter of time. The politics of Obama to get his will imposed has a significant bearing on our outcome. He is playing a very small card with a pack that has no Aces left IMO. The people he is agin seemingly do not care for his fiscal response and neither does the populace of the USA anymore.

Ahhhhhhhh I do miss those lazy afternoons on the front verandah with Mr Burns and robots basking in the afterglow of a property settlement. The times we had. I feel like it was only yesterday ......... wait a minute ....... it was. Property is a long term environment for those who understand the ruse of the market.

The future is for the young MW. A donkey only learns after the first kick.

Me sold??? Nahhhhhhhhhhh still looking for a decent doctor to get me a frontal lobotomy so I can keep up with this property thread. Got any commercial warehouse stuff?

Tysonboss1 · 16 July 2011

Junior said:
A lot of fools have made a lot of money over the past 10 years investing in gold.

lets take the chart back a few years and see what comparisons can be gleaned.

So yes gold is a boom and bust commodity, and all those years without income. feel sorry for anyone that bought as a hedge against inflation in the late 70's.

explod · 16 July 2011

Tysonboss1 said:
lets take the chart back a few years and see what comparisons can be gleaned.

So yes gold is a boom and bust commodity, and all those years without income. feel sorry for anyone that bought as a hedge against inflation in the late 70's.

But many investors in at 200 to 400 would have had plenty of opportunities post the high to unload at 600 in 1980, and bet many did.

Just like some of the smart money over the last eighten months selling out of some of the best properties here in Toorak, Victoria.

Very good investors are also good traders.

Aussiejeff · 16 July 2011

Tysonboss1 said:
lets take the chart back a few years and see what comparisons can be gleaned.

So yes gold is a boom and bust commodity, and all those years without income. feel sorry for anyone that bought as a hedge against inflation in the late 70's.

Between '79 & '99 new, much more efficient mining technologies & methods as well as discoveries of massive additional gold reserves helped keep prices flat.

Maybe the rate of new reserves discovery & gold production is declining somewhat of late at the same time the voracious appetites of China & India for the glittering prize keep growing?

Looks like a different scenario to me than gold demand 15-20 years back....

robots · 16 July 2011

hello,

oh gidday brothers, just back from doing 500 hrs of work this week and on the bus home there was this flyer on everyone's seat:

http://www.reiv.com.au/~/link.aspx?_id=4FF20028A7DB491F9728F6DB37B82EFD&_z=z

amazing, well another great week, called into festival hall on wednesday for the mass meeting, some great speeches from members of the community

oh well, take it easy brothers and enjoy the rest of the weekend

thankyou
professor robots

wayneL · 16 July 2011

robots said:
hello,

oh gidday brothers, just back from doing 500 hrs of work this week and on the bus home there was this flyer on everyone's seat:

http://www.reiv.com.au/~/link.aspx?_id=4FF20028A7DB491F9728F6DB37B82EFD&_z=z

amazing, well another great week, called into festival hall on wednesday for the mass meeting, some great speeches from members of the community

oh well, take it easy brothers and enjoy the rest of the weekend

thankyou
professor robots

Jayzuz we thought you had been murdered by a Socialist activist.

Welcome back to the twilight zone.

Judd · 17 July 2011

It does seem all lovey dovey doesn't it. Then again others have a different viewpoint.

www.refindhouseprices.com

The future of Australian property prices

trainspotter

medicowallet

trainspotter

medicowallet

trainspotter

james0909

medicowallet

kincella

medicowallet

wayneL

VIVA LA LIBERTAD, CARAJO!

trainspotter

trainspotter

medicowallet

trainspotter

Tysonboss1

explod

explod

Aussiejeff

robots

hello

wayneL

VIVA LA LIBERTAD, CARAJO!

Judd

Similar threads

The future of Australian property prices

VIVA LA LIBERTAD, CARAJO!

explod

hello

VIVA LA LIBERTAD, CARAJO!

Similar threads

Privacy & Transparency

Privacy & Transparency