The future of Australian property prices

[explod]

The higher dollar is hurting our employment situation.

Reduced employment opportunities and lower wages is hitting the wider middle classes;

and that is the big one that will impact more and more on property prices.

 

[medicowallet]

If the mining boom is increasing the wages throughout the economy, I can't see how professionals would not also be benefiting.

They are, but the effect is diluted. It is also recycled via the trades quite well via inept government strategies such as the FHVB.

Miner on $50k buys house from builder making $75k profit, paying worker $50k per year.

Miner on $150k buys house from builder making $150k profit, paying worker $85k per year.

Concentrating money in the subsector not deemed "professionals". Hence there is an increase in BCW incomes relative to "professional" incomes.

Please tell me your posts were tongue in cheek..


MW

 

[Tysonboss1]

Concentrating money in the subsector not deemed "professionals". Hence there is an increase in BCW incomes relative to "professional" incomes.



MW

No doubt all that building and various other economic activity is stimulating fees to lawyers, accountants, architects etc. Even the doctors and dentists should be having a better go at it.

 

[Tysonboss1]

The higher dollar is hurting our employment situation.

Reduced employment opportunities and lower wages is hitting the wider middle classes;

and that is the big one that will impact more and more on property prices.

Here is from the RBA.

In the long term, the main implication of an appreciating exchange rate is structural change within the Australian economy. Since a strong Australian dollar means that Australian exports become more expensive, export industries will effectively become less competitive in the world market. Export industries other than mining, including farming, manufacturing and tourism, are likely to be impacted by this. Those that cannot compete under the high exchange rate will contract. This results in the release of labour and capital previously utilised by inefficient businesses, which will be reallocated to the expanding mining industry. The reallocation of resources to an area of production in which they are being used more efficiently results in higher productivity growth and increased economic growth. This in turn leads to higher real incomes for Australians, and higher living standards.

You just have to roll with the punches.

 

[Wysiwyg]

Because their company does not service the mining industry nor service any industry which does.

Exactly and the reason why wages of keyboard tappers in the city high rises remain relatively stagnant. Big company stumps up billions and the construction firms (including engineering pros.) are hired. Flow on is directly to the local community and indirectly to the government via taxes for distribution. House construction and existing house prices rise proportionately to incomes in the local area. Unskilled people may find it tough due to increased rents and living costs.

We are in the middle of a mining and energy construction boom but if you are not directly in touch with it then the personal returns for effort obviously won't be as great.

 

[Mrmagoo]

So you don't believe the cash generated by mining flows through the economy,

Where do the share holders live that spend the dividends,
Where does the state governments spend their royalties,
where does the federal goverment spend the company tax and income tax,
where do the fly in fly out mine workers spend their pay check,

There are far to many trickle down areas to mention, For example cash from a mine in western NSW, is probably funding school teachers, police officers and road workers in sydney, and that flows on and on,

Trickle down economics and flow ons from a quantiative perspective are largely pseudo scientific mythology.

If you can show me actual emperical evidence that wealth concentration leads to flow ons which result in economic growth then I might listen. However, I'd need time to critically examine the articles so I doubt we'd be settling this over the internet.

Anecdotaly, Europe and the US and what I've seen with my own two eyes in Australia indicate that the mining boom doesn't "flow on" and the rest of the country was largely better off before the silly boom.

 

[Mrmagoo]

Exactly and the reason why wages of keyboard tappers in the city high rises remain relatively stagnant. Big company stumps up billions and the construction firms (including engineering pros.) are hired. Flow on is directly to the local community and indirectly to the government via taxes for distribution. House construction and existing house prices rise proportionately to incomes in the local area. Unskilled people may find it tough due to increased rents and living costs.

Who exactly is the local community ?

Tradies ? Sure, they earn a bit more than they used to and some of them got rich (likely through hard work) but I'm pretty sure I don't want to be one any time soon.

That basically leaves office workers and the un-skilled.

Engineers ? Because we all had 4-6 year of mummy and daddy looking after us while we studied an intensive course and graduated on a whopping 55k a year. Plus if we all went and got engineering degree's we'd all be unemployed or earning a crap wage.

Why not just say that doctors make good money, so the economy must be doing fine. (also see above regarding mummy and daddy).

It is not that I am jealous (which I am but that is not the reason) it is just that it really irks me when people think that going off and getting some fancy degree is the solution to all problems.

Yeah, the unskilled suffer, which funnily enough is like, I dunno, like the majority of the population who buys stuff and pays taxes. So what you're really saying is the majority of people suffer, so the economy tanks, so nothing flows on, but people in my social circle are all well off and they do okay, so it must all flow on nicely.

 

[Mrmagoo]

Here is from the RBA.



You just have to roll with the punches.

I wouldn't trust teh RBA to walk my dog. I'm sure they have some intelligent quantitative people, but economic theory like that is silly and helps no one.

 

[Wysiwyg]

Who exactly is the local community ?

Tradies ? Sure, they earn a bit more than they used to and some of them got rich (likely through hard work) but I'm pretty sure I don't want to be one any time soon.

We are in the middle of a mining and energy construction boom but if you are not directly in touch with it then the personal returns for effort obviously won't be as great.

 

[Mrmagoo]

If retail and manu. continue as they are all I can say is brace for complete economic destruction and 9% unemployment because we're slowly becoming the basket case US economy and we all know what happened to prices there.

Look, if you earn 30k a year and your rent is 300pw that leaves you with about $200 to live off, $100 for food and probably another $100 for bills leaves about 50 bucks to afford the train to work and back.

As the cost of stuff rose, that person probably took out a credit card so now isn't even consuming $100 worth of food items.

Have enough people like that and retail businesses statrt going under. Why ?

They were built in a time when :

30k gave u $450 a week instead of $550

BUT

rent was $80 a week, bills were $25 and for $50 a week you ate really well.

Then the whole thing just spirals.

 

[Tysonboss1]

Trickle down economics and flow ons from a quantiative perspective are largely pseudo scientific mythology.

If you can show me actual emperical evidence that wealth concentration leads to flow ons which result in economic growth then I might listen. However, I'd need time to critically examine the articles so I doubt we'd be settling this over the internet.

Anecdotaly, Europe and the US and what I've seen with my own two eyes in Australia indicate that the mining boom doesn't "flow on" and the rest of the country was largely better off before the silly boom.

All you need to see is that 43% of mining revenues enter government coffers, They are then spent ( Or wasted however you like to put it ) on things in ever corner of the country, how is this not trickle down,

 

[Mrmagoo]

All you need to see is that 43% of mining revenues enter government coffers, They are then spent ( Or wasted however you like to put it ) on things in ever corner of the country, how is this not trickle down,

I told you above. I'm not here to prove that I am right to you. I know I am right and will one day profit from it.

 

[explod]

Here is from the RBA.



You just have to roll with the punches.

The good ole RBA. Like swanny, they would not have a clue.

And all premised on the mining industry. As has been pointed out, our high dollar and the high prices for commodities over the last few years are opening up mines in other areas away from Australia.

And they have the ore bodies dont worry about, with much cheaper labour too.

Commorn there Pal, you need to come up with more substance than that to hold the property market up.

 

[young-gun]

Who exactly is the local community ?

Tradies ? Sure, they earn a bit more than they used to and some of them got rich (likely through hard work) but I'm pretty sure I don't want to be one any time soon.

That basically leaves office workers and the un-skilled.

Engineers ? Because we all had 4-6 year of mummy and daddy looking after us while we studied an intensive course and graduated on a whopping 55k a year. Plus if we all went and got engineering degree's we'd all be unemployed or earning a crap wage.

Why not just say that doctors make good money, so the economy must be doing fine. (also see above regarding mummy and daddy).

It is not that I am jealous (which I am but that is not the reason) it is just that it really irks me when people think that going off and getting some fancy degree is the solution to all problems.

Yeah, the unskilled suffer, which funnily enough is like, I dunno, like the majority of the population who buys stuff and pays taxes. So what you're really saying is the majority of people suffer, so the economy tanks, so nothing flows on, but people in my social circle are all well off and they do okay, so it must all flow on nicely.

im a sparky - and make alot more money than most people would think, and work no more hours than a key basher. there is plenty of work going in brissy. not to mention commonwealth games, thats work for years for us construction workers both in brisbane and goldy. there is huge flow on affects. thanks blighe, or maybe gillard - not sure who funds the infrastructure. either way we're winning

to stay on topic - house prices to fall

 

[kincella]

couple of points for the mushrooms.....
homeowners have been splurging 35 billion on home renovations..rather than selling, then upgrading and paying state govnut fees and taxes...a huge saving there

more people are selling by private treaty...rather than auction
cause auctions only work in a heated market....
and we do not have a heated market right now....

for everyday the stockmarket girates....it loses another conservative investor.....
with his tail between his legs,,,,he takes what is left.....and puts it into the property market....
there are a stack of people out there, on salary or wages, who watch in awe....just how much they are losing on their superfunds.....and there is absolutely nothing they can do about it...
because the majority of superfunds invest their clients money into the gambling den of the stockmarket....
it is only the DIY...small business operators, who have their own superfunds, that can control their super investments.

Harry Tribgunorf or whatever his name is...said today,,,he is only geting 12 chinese investors in his 'off the plan apartments', compared to 25 investors per week last year...

Australian expats to the UK are coming home in droves....
France will be the net one to fall.....
Germany is waiting in the wings.....to take over the Euro assets, at a fraction of the price
China is primed.....it has you, the consumer figured out

you will be able to buy, australian farms, and land at a fraction of the price in the future.....contaminated places....after the coal seam gas cowboys. have ripped it up. and destroyed it....,,, it will leave what was once thriving food bowls.....now barren wastelands.....
but sitting there in your city offices....you will have absolutely no idea..what went wrong......higher food and energy costs.....will have an impact......
but in most cases it will fall on deaf ears....

 

[Mrmagoo]

im a sparky - and make alot more money than most people would think, and work no more hours than a key basher. there is plenty of work going in brissy. not to mention commonwealth games, thats work for years for us construction workers both in brisbane and goldy. there is huge flow on affects. thanks blighe, or maybe gillard - not sure who funds the infrastructure. either way we're winning

to stay on topic - house prices to fall

As I said " me and my circle of privilleged friends are doing well out of mining so the rest of the country must also be "

Never mind that most of the country are NOT electricians working in commercial construction getting 110k a year base, plus every second friday off, family picnic day, an allowance if it is under 20 degrees and allowance if it is 10am an allowance for going to work....

Most people earn an average crappy wage which is further reduced by inflation and increased housing prices. That'll start to cause some of those key b ashers to lose jobs soon and then there is no one to buy houses or pay taxes to fund constrsuction.

 

[Tysonboss1]

Commorn there Pal, you need to come up with more substance than that to hold the property market up.

Have I ever said I wish to hold the property market up, Or any market for that matter.

Why would I want to encourage higher prices, I am going to be a buyer of real estate over the next 30 years I want the prices to go down.

 

[Tysonboss1]

It is not that I am jealous (which I am but that is not the reason) it is just that it really irks me when people think that going off and getting some fancy degree is the solution to all problems.

Yeah, the unskilled suffer, which funnily enough is like, I dunno, like the majority of the population who buys stuff and pays taxes. So what you're really saying is the majority of people suffer, so the economy tanks, so nothing flows on, but people in my social circle are all well off and they do okay, so it must all flow on nicely.

Why Be jealous? Envy is the only deadly sin you will never have any fun at. Never feel sorry for yourself or feel envy. Once you adopt of victim attitude, you done for.

I don't think the unskilled suffer, I think the unmotivated suffer. Any one who is prepared to get out there and get after it will succeed in this country.

I told you above. I'm not here to prove that I am right to you. I know I am right and will one day profit from it.

One day, Mmmm. why not today, why not for the last 10 years. I am not here to proove anything either. I am not right or wrong because people agree of disagree, I am right or wrong because my data and reasoning is right or wrong, and my investments and income either meet expectations or fail to meet expectations.

Never mind that most of the country are NOT electricians working in commercial construction getting 110k a year base, plus every second friday off, family picnic day, an allowance if it is under 20 degrees and allowance if it is 10am an allowance for going to work....

Most people earn an average crappy wage which is further reduced by inflation and increased housing prices. That'll start to cause some of those key b ashers to lose jobs soon and then there is no one to buy houses or pay taxes to fund constrsuction.

You remind me of this guy,



No one is going to offer you a fantastic pay check when you act like him. You have to be motivated, Find an industry you love and be the best at it, Be the guy customers love to come and see, be the go to guy that you employer can't live without, be above average, turn up early do extra, spend time thinking about how you can serve better, and money will flow in.

The best way to get what you want in life is to deserve what you want.

 

[So_Cynical]

A Malaysian bank is offering loans for the purchase of Prime Aussie property.

OCBC Bank offers loans to buy properties in Australia:

Head of Consumer Financial Services, Charles Sik said the introduction of the facility, OCBC Overseas Property Financing-Australia, follows the success of a similar scheme for London properties launched six month ago.

"Like the earlier scheme, customers will be able to take advantage of the fact that this is also a ringgit-based loan, hence mitigating the effects of fluctuating foreign exchange risks,"

LOL no currency risk there... everything old is new again, its all one big merry go round.

http://biz.thestar.com.my/news/story.asp?file=/2011/11/14/business/20111114114623&sec=business

 

[Tysonboss1]

As I said " me and my circle of privilleged friends are doing well out of mining so the rest of the country must also be "

Never mind that most of the country are NOT electricians working in commercial construction getting 110k a year base, plus every second friday off, family picnic day, an allowance if it is under 20 degrees and allowance if it is 10am an allowance for going to work....

Most people earn an average crappy wage which is further reduced by inflation and increased housing prices. That'll start to cause some of those key b ashers to lose jobs soon and then there is no one to buy houses or pay taxes to fund constrsuction.

I think if you take the time to listen to Dave you will gain a better outlook as to your place in the economy.