The future of Australian property prices

[KurwaJegoMac]

Well forgive me for discounting your statments of returns as meaningless and baseless.

No doubt you are not including stamp duty etc into your calculation, as it is a recent purchase etc.

Or perhaps you believe everything you read on a forum..

If you are so transparent, do you expect me to request you to pm me all your transaction details regarding this property????? Of course not... so much for presumptions, one lines anre baseless statement, looks like you invented it all.

I was not born yesterday, and I am not naive.

I provide facts and numbers, you provide senseless generalisations that don't even address what's being discussed. Then when you get caught out and trapped in a corner, you come out with statements like "sure", "you're in denial" or an off reference to "mum and dad investing" (seriously? That's the best you can respond with??) Then you attempt to deflect the argument without providing anything substantial as a reply - "so how are the losses going for you" and similar drivel. It's not just me that you do it to of course, but to anybody who disagrees with what you say.

Seems that all that is required from a bearish armchair economist is a few simple lines of baseless statments ('you're wrong', 'in denial', 'property will crash, don't ask me to explain how, just trust me it will', etc) and you're a regular bonified investor.

You're really a troll aren't you? I bet you're some young 20-something, still at Uni, having a cry that you can't afford to buy any property because all the greedy investors are pricing you out. Due to your fear, you're too terrified to work hard and make some sacrifices early on for long term gain. So you come onto a forum, surround yourself with similar 'yes men' who's best contribution is 'herp derp property will crash 40% loLOLol' and simply respond with a 'you're in denial' or 'you're just so naive' whenever you're reasonably challenged.

Still, you're only human. Scared and bitter that others are making headway where you are not. You can keep your baseless comments coming - I definitely want to hear more from a property bear with a portfolio of RE who's been forecasting for 12 months that a downturn is happening yet refuses to sell a single property.

Keep talkin, still full of s*** as always. But at least it makes for a good laugh.

 

[KurwaJegoMac]

No doubt you are not including stamp duty etc into your calculation, as it is a recent purchase etc.

See you don't even know what you're talking about.

I posted my annual loss, per year, from all revenue and expenses in running the property ($2703).

Then i said that my property value had increased by $4850.

Where did I say that I made money on top of my purchase price? Stamp duty has no bearing on the change in property value, nor does it change your annual loss/profit. It will however change your total investment return (which at the moment is at a loss of course, as the income less expenses less current value of the home is not more than the purchase price).

Troll is troll. Pretty bad at it too. At least learn basic investing principles before spouting more drivel.

 

[medicowallet]

See you don't even know what you're talking about.

I posted my annual loss, per year, from all revenue and expenses in running the property ($2703).

Then i said that my property value had increased by $4850.

Where did I say that I made money on top of my purchase price? Stamp duty has no bearing on the change in property value, nor does it change your annual loss/profit. It will however change your total investment return (which at the moment is at a loss of course, as the income less expenses less current value of the home is not more than the purchase price).

Troll is troll. Pretty bad at it too. At least learn basic investing principles before spouting more drivel.

1. Actually it is you who is the young 20 year old.

2. Come on, you inferred your return was +$2000ish, and in which case, you were misleading. You are still behind on the purchase price, and hence, at this point in time, even if I can believe your "armchair" valuation, are still in negative territory. Because, if you are to use incomes such as rent etc, then you sure as heck need to include taxes/levies/duties within the calculation too, champion, or, is your accountant incompetent too? revenues/expenses and profit/losses / asset/liabilities are just accounting terms. in the REAL WORLD, you are down, and get used to it, because a bank does not GAS about your idea, if you go for a loan, you are down the stamp duty component on your current net worth.


3. I am sorry that the statistics agree with me that housing is going down at the moment. Please get real, it will help you in the future as you grow up.

4. Can you please include inflation within your calculation,...... ooooh, backwards even further... so much for keeping up with/exceeding inflation every year hey champ.

5. I am sure you can take some of these losses as an engineer, I mean, they do earn ok money I suppose (compared to an average income earner )

 

[KurwaJegoMac]

1. Actually it is you who is the young 20 year old.

Didn't say I wasn't

2. Come on, you inferred your return was +$2000ish, and in which case, you were misleading. You are still behind on the purchase price, and hence, at this point in time, even if I can believe your "armchair" valuation, are still in negative territory. Because, if you are to use incomes such as rent etc, then you sure as heck need to include taxes/levies/duties within the calculation too, champion, or, is your accountant incompetent too? revenues/expenses and profit/losses / asset/liabilities are just accounting terms. in the REAL WORLD, you are down, and get used to it, because a bank does not GAS about your idea, if you go for a loan, you are down the stamp duty component on your current net worth.

Nope, I never inferred that my return was $2000ish. I clearly stated that my annual loss (excl. CG) was just under $3000. I'll say it again - my annual loss (excl. CG) is $2703. Just so it's clear - I am losing $2703 per yearwithout taking CG into consideration. Also, that includes all taxes, rates, maintenance, etc. My property is costing me $2703 per year to maintain at current levels. This is different to my investment return, which as i pointed out before, is currently at a loss when looking at the value of my property (inclusive of all holding costs and purchasing costs) compared to the current value of the property.

However, if we take CG into consideration ($4850) I am making an annual gain but I have still currently sitting on a loss (due to stamp duty and other purchasing costs as you mentioned).

Hopefully that's clear now. I have no idea how I can possible make it any clearer despite writing it in 3 posts.

3. I am sorry that the statistics agree with me that housing is going down at the moment. Please get real, it will help you in the future as you grow up.

Lies, damn lies and statistics. As a prominent investor with a 'portfolio' you would know very well that statistics do not refelect the state of every asset within a market. On average, it may reflect them - but there are extremes at both ends. Just like the ASX is a 'statistic' showing the 'average' of the stock market: are you telling me that when the ASX goes down then every single stock in the market goes down? That if the ASX goes down 20% that means no stock could have made a gain?

4. Can you please include inflation within your calculation,...... ooooh, backwards even further... so much for keeping up with/exceeding inflation every year hey champ.

I'm happy to include inflation with my calculation if I was calculating my total investment return. But I have not provided any such calculation pertaining to my total investment return on this thread. Clutching at straws again I see.

5. I am sure you can take some of these losses as an engineer, I mean, they do earn ok money I suppose (compared to an average income earner )

You know so much about me, but do you know what I know about you? Nothing. That's the beauty of it - nobody cares about you or what you do, enough to go and research it. Think about that for a moment

Well Mr. Smarty pants, quick to make assumptions - while I am an Engineer by degree I am not an Engineer by trade. I am living quite comfortably well above median wage. I am in fact looking at buying a PPOR as i'm renting atm. Current repayments on my IP are 5% of my after tax income. So I can more than comfortably sit on any losses that come my way.

I worked hard to get where I am today and will continue to work hard while I am able. You can be bitter all you want about the fact that someone is more successful than you - it won't stop me. At least I come on here in the spirit of sharing knowledge, hopefully inspiring others to think about their own situations and make something of themeselves - rather than others who just berate and belittle everyone.

"It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat."

 

[medicowallet]

Didn't say I wasn't



Nope, I never inferred that my return was $2000ish. I clearly stated that my annual loss (excl. CG) was just under $3000. I'll say it again - my annual loss (excl. CG) is $2703. Just so it's clear - I am losing $2703 per yearwithout taking CG into consideration. Also, that includes all taxes, rates, maintenance, etc. My property is costing me $2703 per year to maintain at current levels. This is different to my investment return, which as i pointed out before, is currently at a loss when looking at the value of my property (inclusive of all holding costs and purchasing costs) compared to the current value of the property.

However, if we take CG into consideration ($4850) I am making an annual gain but I have still currently sitting on a loss (due to stamp duty and other purchasing costs as you mentioned).

Hopefully that's clear now. I have no idea how I can possible make it any clearer despite writing it in 3 posts.



Lies, damn lies and statistics. As a prominent investor with a 'portfolio' you would know very well that statistics do not refelect the state of every asset within a market. On average, it may reflect them - but there are extremes at both ends. Just like the ASX is a 'statistic' showing the 'average' of the stock market: are you telling me that when the ASX goes down then every single stock in the market goes down? That if the ASX goes down 20% that means no stock could have made a gain?



I'm happy to include inflation with my calculation if I was calculating my total investment return. But I have not provided any such calculation pertaining to my total investment return on this thread. Clutching at straws again I see.



You know so much about me, but do you know what I know about you? Nothing. That's the beauty of it - nobody cares about you or what you do, enough to go and research it. Think about that for a moment

Well Mr. Smarty pants, quick to make assumptions - while I am an Engineer by degree I am not an Engineer by trade. I am living quite comfortably well above median wage. I am in fact looking at buying a PPOR as i'm renting atm. Current repayments on my IP are 5% of my after tax income. So I can more than comfortably sit on any losses that come my way.

I worked hard to get where I am today and will continue to work hard while I am able. You can be bitter all you want about the fact that someone is more successful than you - it won't stop me. At least I come on here in the spirit of sharing knowledge, hopefully inspiring others to think about their own situations and make something of themeselves - rather than others who just berate and belittle everyone.

"It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat."

1. Thankyou for clearing up that you made a loss. You did not do this, contrary to your belief. When you mature, please reread the posts, and you will realise that I had to tease this out of you. I bet you are the kind of person who would never ever admit that they were wrong.

2. Don't flatter yourself, I remember things, such as occupations etc. because it is a skill valuable to me.

3. NICE income!!! 20% deposit so say 80% on 400k x 7% interest x 20

a $450k income per year is very nice indeed.

or was that 20x 2700 = $54k after tax....

hmm, 2 properties on $450k is no problems, 2 properties on $54k is a bit risky, but then again, I think, when the property market burns you the first time, you will become a better, less arrogant investor.

 

[KurwaJegoMac]

1. Thankyou for clearing up that you made a loss. You did not do this, contrary to your belief. When you mature, please reread the posts, and you will realise that I had to tease this out of you. I bet you are the kind of person who would never ever admit that they were wrong.

It is you who needs to reread the posts when you mature. In EACH of the three seperate posts i mentioned I was making a yearly loss. It is not my fault you lack basic reading comprehension skills and required bolded writing in italics, repeated three times, before you comprehend. Read each post again and what did i say in each? A loss of $2703. Go on back and read them. Wrong yet again!

2. Don't flatter yourself, I remember things, such as occupations etc. because it is a skill valuable to me.

strange that you claim to 'remember things' since by the time you've posted you've forgotten what i had written - refer to point 1. While you're at it, you should develop your attention to detail skills as they are clearly lacking.

3. NICE income!!! 20% deposit so say 80% on 400k x 7% interest x 20

a $450k income per year is very nice indeed.

or was that 20x 2700 = $54k after tax....

hmm, 2 properties on $450k is no problems, 2 properties on $54k is a bit risky, but then again, I think, when the property market burns you the first time, you will become a better, less arrogant investor.

Wrong once again. This really is becoming a consistent theme with you isn't it? In your infinite investing wisdom you failed to include tax benefits. Once again, shows the lack of attention to detail and basic financial calculations and investment basics. Keep developong those memory skills! Seems like they need some more work.

 

[medicowallet]

It is you who needs to reread the posts when you mature. In EACH of the three seperate posts i mentioned I was making a yearly loss. It is not my fault you lack basic reading comprehension skills and required bolded writing in italics, repeated three times, before you comprehend. Read each post again and what did i say in each? A loss of $2703. Go on back and read them. Wrong yet again!

strange that you claim to 'remember things' since by the time you've posted you've forgotten what i had written - refer to point 1. While you're at it, you should develop your attention to detail skills as they are clearly lacking.



Wrong once again. This really is becoming a consistent theme with you isn't it? In your infinite investing wisdom you failed to include tax benefits. Once again, shows the lack of attention to detail and basic financial calculations and investment basics. Keep developong those memory skills! Seems like they need some more work.

1. You said you made a loss exc capital gains of $2700, then quoted a capital gain, so, were inferring (look this word up), that you made $2k... I corrected you, you went, immaturely, into damage mode.

2. I note that we both used after tax eg "54k after tax" KJM, in your circles, this kind of argument might hold weight, but, unfortunately, I see through your pettiness and incompetence. You may be good with numbers, but I guess, only in a newton kind of way.


Look KJM, you are in a investment strategy which is risky at the moment. Get used to it. I am afraid that your arrogance will NOT stop price declines. Welcome to the real world champ.

I would also like to point out, that I was probably a bit arrogant about investments, like you, when I was in my 20s and untouchable.. Losing money in "sound" investments makes you consider investments from a different viewpoint. You were just a bub last time property / the economy underwent a bad patch, if you could take some time to get off your high pony, it might help you understand the signs... some of us have seen them before, some of us see them now.

 

[finnsk]

You were just a bub last time property / the economy underwent a bad patch, if you could take some time to get off your high pony, it might help you understand the signs... some of us have seen them before, some of us see them now.

I was also only a bub last time, so which signs are you seeing know?

 

[medicowallet]

I was also only a bub last time, so which signs are you seeing know?

emotional : Desperation, denial, the last throes of euphoria

RE agents calling when before they didn't GAS

heavy discounting, lagging stock, clearance rates

retail and manufacturing tanking, empty retail shops.

banks forecasting lower credit growth

builders squealing and going broke

negative symbols in capital city property growth.

inflation for staples out of whack.

unemployment increasing (and more importantly, participation rates falling)

Disappearance of Robots

These are but a few examples, and are really not reflecting the potential stagnation/deleveraging from around the globe.

At the very least, there we are in for stagnation in real property prices, but I hope for a 20% fall so I can use some of my cash reserves I have been accumulating.

What does anyone think are positives?

 

[tech/a]

This thread is still as boring as it was 3 yrs ago.

 

[stacks]

Medicowallet, I reckon if you charged by the hour for writing in this thread, the price of property wouldnt matter and you could just about retire already

 

[Agentm]

i am hanging out for the falls

i think the industry is very resilient, and with the victorian premier very much tied into the sector. i think they will do everything possible to rekindle the bubble, and inflate property/land prices as much as they can muster.

i have friends in houston TX, which is considered a template for urban development, and his home, 2 story monster with 5 bedrooms, 2 separate living zones, 3 car garage - with basketball hoop above garage door.... in a magnificent estate with oak tree lined streets, nature paths 3 times wider than anything i have seen here.. underground power and warm apple pies cooling at the kitchen window.. $240K. i think the estate was built about 10 years ago, all lookalikes.. and its a place that everyone want to live, a beautiful community..

when i tell him that a pathetic run down 2 bedroom terrace in melbourne fetches easily 3 times that, they really cant understand it. there is abundance of land in australia..

the bubble is here, the push to keep it alive is there, but imho the possibility of a high aussie dollar perhaps squeezing a few sectors like retail and tourism.. may mean more stock to flood the market..

i would like to see way more than 20% come off the bubble, and i wonder what it will implode to..

have not read this thread for a long time? did you say no robot?? he had this massive list of people he defeated, his kill list.. why leave the debate when the story was so crystal clear.. maybe he went to a pro climate change forum.. he may believe that fairy tale too?

 

[satanoperca]

This thread is still as boring as it was 3 yrs ago.

What would get you excited? Property on a 1 min time frame with massive liquidity.

Cheers

 

[notting]

This thread is still as boring as it was 3 yrs ago.

Oh that's a bit unfair.
What about Josh and Jenna'ss engagement!
That was exiting.
I'm all over it.
Got my Women's Day.
Whatching the replays on ninemsn.
Have driven by the houses trying to catch a glimps of the stars.
Pam and Waz.
Who would have thought eh?
Makes you think doesn't it.
Yeah.
Three letters in each of their names.
That's interesting.

 

[tech/a]

What would get you excited? Property on a 1 min time frame with massive liquidity.

Cheers

Please

 

[medicowallet]

Medicowallet, I reckon if you charged by the hour for writing in this thread, the price of property wouldnt matter and you could just about retire already

If I had more than a 4 finger typing style, it would be much better. Alas I am too old to learn this technology stuff (and things like quoting multiple stuff etc)

I am just keeping this thread alive with a few others... good past time, and most of us are sane, reasonable people, just with a different viewpoint. We get a bit narky at times, but get over it

 

[medicowallet]

Please

Careful tech/a

Only takes a few more posts to get hooked....

 

[FxTrader]

i have friends in houston TX, which is considered a template for urban development, and his home, 2 story monster with 5 bedrooms, 2 separate living zones, 3 car garage - with basketball hoop above garage door.... in a magnificent estate with oak tree lined streets, nature paths 3 times wider than anything i have seen here.. underground power and warm apple pies cooling at the kitchen window.. $240K. i think the estate was built about 10 years ago, all lookalikes.. and its a place that everyone want to live, a beautiful community..

when i tell him that a pathetic run down 2 bedroom terrace in melbourne fetches easily 3 times that, they really cant understand it. there is abundance of land in australia..

Such examples are endless but location is important, I would NEVER chose to live in Texas for example. My brother's wife is a real estate agent in Florida and you would not believe what say $400k will buy you - huge quality built home in a beautiful neighborhood, fully landscaped gardens with a fully enclosed swimming pool and entertaining area (took her over 6 months to sell it as I recall). Here in Melbourne $400k will buy you an old, small, run down rectangular BV, a unit or a newer small home on a tiny block in far outer suburbia. The ridculous prices we pay to for housing here can be put down to many factors (e.g. bank funded explosion of housing debt) not the least of which include local, state and federal government interventions in the market of various kinds including...

* Billions of dollars of subsidies to property investors annually
* Subsidies to first home buyers
* Highly restrictive urban land release and use policies creating artificial scarcity (the green belt mentality - once my house is built stop all further development in my area in the name of reducing urban sprawl)

But we must not forget that wise old sage robots who reminded us that Australia is a paradise and everywhere else in the world is a dump by comparison. Pay up or leave was the refrain as I recall. I say afforadability is an issue and making it harder for Australians to afford the roof over their heads is economic mismanagement and lunacy.

 

[James58209]

Mish's take on U.S. housing bottom "in some areas" :

Reader Seeks Help/Advice on US Housing/Economy; How Far to THE Bottom?

Where is Australia on this graph? Are we nearly at the first "Never A Better Time To Buy"? The equivalent of the U.S.A. in Autumn 2007?

 

[medicowallet]

Mish's take on U.S. housing bottom "in some areas" :

Reader Seeks Help/Advice on US Housing/Economy; How Far to THE Bottom?

Where is Australia on this graph? Are we nearly at the first "Never A Better Time To Buy"? The equivalent of the U.S.A. in Autumn 2007?

I VERY much dislike how that graph tries to superimpose America onto it, inferring a decrase to 50% of peak prices.

This type of graph is NOT what I am suggesting for australia, but more of a slow, plateau slightly declining (20% of real loss (of which we have seen 5% over the past 6 months)) then a tack up slowly, along a more reasonable course.

Anyone who thinks properties will halve here, is very brave, but a pullback is inevitable, as prices cannot and will not continue to grow faster than inflation.