The future of Australian property prices

Starcraftmazter · 2 April 2012

tech/a said:
Your totally ridiculous comment would have every builder and every investor,every Real estate office,Every sub contractor,every suppliers of building needs.
shut shop.

Well I hate to brag about the accuracy of my predictions, but building approvals did come in today at a miserable -7.8%.

There are many opportunities - but not in housing. Not when we are just past the peak of the bubble. Total waste of money.

young-gun · 2 April 2012

soo anyone read today that construction approvals are down 7.8%?

tech, i disagree that there are any good opportunities in the current market, if you are sitting on houses you purchased long ago you are in a much different and more fortunate situation to the younger generations. not saying there wont be good opportunities, jsut saying that there isnt always such at ever turn.

if i owned positively geared properties that were paid off 5-10 even 15 years ago and i was pulling 300+ a week per property then i wouldnt care what happened to the value of it either. i pointed out just recently the wage to house price ratios from 1980 compared to 2011, things are alot different now.

getting in when you did has allowed you to create the capital needed to continue your RE ventures even in tough times. whether or not you will continue to make money off these ventures in the not so distant future is yet to be seen.

young-gun · 2 April 2012

Starcraftmazter said:
Well I hate to brag about the accuracy of my predictions, but building approvals did come in today at a miserable -7.8%.

There are many opportunities - but not in housing. Not when we are just past the peak of the bubble. Total waste of money.

jsut beat me too it.

tech/a · 2 April 2012

Starcraftmazter said:
Well I hate to brag about the accuracy of my predictions, but building approvals did come in today at a miserable -7.8%.

There are many opportunities - but not in housing. Not when we are just past the peak of the bubble. Total waste of money.

Behind my smile is everything you will never understand.

DB008 · 2 April 2012

tech/a, you have to wait until 2020 for SCM to leave, his words, not mine...

Ves · 2 April 2012

young-gun said:
soo anyone read today that construction approvals are down 7.8%?

tech, i disagree that there are any good opportunities in the current market, if you are sitting on houses you purchased long ago you are in a much different and more fortunate situation to the younger generations. not saying there wont be good opportunities, jsut saying that there isnt always such at ever turn.

if i owned positively geared properties that were paid off 5-10 even 15 years ago and i was pulling 300+ a week per property then i wouldnt care what happened to the value of it either. i pointed out just recently the wage to house price ratios from 1980 compared to 2011, things are alot different now.

Seriously, you guys have mastered the art of selective reading. Just skipped over his latest developments (highly profitable) willy nilly.

Median prices are about as much use as the ASX index. It's an average or middle point. Not a sum of the opportunites.

I honestly am boggled by your inability to understand this, despite obvious depth and time spent in reading fancy economic reports.

Starcraftmazter · 2 April 2012

DB008 said:
tech/a, you have to wait until 2020 for SCM to leave, his words, not mine...

Only if prices don't drop at least 40% real from peak.

Ves said:
Median prices are about as much use as the ASX index. It's an average or middle point. Not a sum of the opportunites.

I honestly am boggled by your inability to understand this, despite obvious depth and time spent in reading fancy economic reports.

Property in this country is still overpriced by 250%, pretty sure no opportunities exist anywhere. Maybe if it was only 10% you would have been right. But not 250%.

DB008 · 2 April 2012

Starcraftmazter said:
Only if prices don't drop at least 40% real from peak.

Property in this country is still overpriced by 250%, pretty sure no opportunities exist anywhere. Maybe if it was only 10% you would have been right. But not 250%.

Which you are predicting already!

Ves · 2 April 2012

Starcraftmazter said:
Only if prices don't drop at least 40% real from peak.

Property in this country is still overpriced by 250%, pretty sure no opportunities exist anywhere. Maybe if it was only 10% you would have been right. But not 250%.

Are you suggesting that tech/a is lying about his recent deals?

tech/a · 2 April 2012

DB008 said:
Which you are predicting already!

Danny

“You can educate a fool, but you cannot make him think”

Anyway I'm off must put in a call to the liquidator!

DB008 · 2 April 2012

tech/a said:
Danny

“You can educate a fool, but you cannot make him think”

Anyway I'm off must put in a call to the liquidator!

Hear Hear....

Uncle Festivus · 2 April 2012

tech/a said:
Danny

“You can educate a fool, but you cannot make him think”

Anyway I'm off must put in a call to the liquidator!

From memory you are in Adelaide? Does it not concern you that Adelaide is to a large extent reliant on car manufacturing, with mining contributing a bit? The very same car industry reliant on various Fed & State subsidies etc, and mining reliant on Japan & China?
A big egg in a small basket?

Uncle Festivus · 2 April 2012

Land of opportunity for the go-getters......

STUART GRIMSHAW, CEO, BANK OF QLD: We've seen signs of rapid property value decretion in the Sunshine and Gold coasts in particular, and I don't think that's a surprise to anyone, but the extent of the rapidity of the move has probably surprised me a little which has caused us to mark to market our book in that troublesome and impaired area just for prudence and conservatism, and I think that's the right place to be and that's part of the reasons for that capital raising.

Do these people trawl thesaurus so they don't have to say "We've seen signs of rapid property value loss...."

De*cre"tion\, n. [From L. decrescere, decretum. See Decrease.] A decrease.

Glen48 · 2 April 2012

Write yourself a memo Tech/a to open that post again this time next year;
There is no guaranteeing your tenant won't have tanked with the depression so it doesn't matter what rent you are getting now what will if be next year is the important question.

Julia · 2 April 2012

Starcraftmazter said:
Now I don't know about you, but I doubt I will live another 100 years to see another housing bubble. This is besides the fact that house prices will go down for the next 20 years at least.

Starcraftmazter said:
Property in this country is still overpriced by 250%, pretty sure no opportunities exist anywhere. Maybe if it was only 10% you would have been right. But not 250%.

Wow, it must be great to know everything and be so totally certain about being right all the time.

I'd rather heed the wisdom of someone who has actually succeeded, rather than someone of zero practical experience sitting on the sidelines pontificating.

Bill M · 2 April 2012

In the 70's, 80's, 90's and 2,000's, we have only heard one thing from those with negative views and that is that house prices will crash. The last one was when sub prime hit the USA 5 years ago. All the Aussie doom and gloomers said we are finished, it's all over, rents are going down, real estate prices will crash, it didn't happen at any of those times.

The rents I charge have gone up, my property is holding firm, Australia is doing ok. So just for a trip down memory lane here is a clip from the early 90's, they were saying the same things then as the naysayers are saying now.

The last time I posted this one was on the old property thread so it's about time I reposted it on this one. I cut it out by hand in 1994.

---
"The table on this page demonstrates how far off the mark the doom and gloom merchants were, when, as they did in 1983 and more recently in 1992, they predicted that price increases were a thing of the past. Whilst caution is wise, undue caution could see some buyers miss out on excellent opportunities."
---
( I typed all that by hand, no cut and pasting as the article was scanned years ago)

So 20 years ago that guy was right, yes indeed, ignore history at your peril, goodnight.

McLovin · 2 April 2012

tech/a said:
Read this article ----- love it---- then everything else should read in context.

The premise of the argument is that for a variety of reasons house prices can't keep rising at the pace they have for the last 15-20 years. Maybe I'm missing something but that doesn't seem like a far fetched idea.

There are some posters on here who have an axe to grind about house prices. I'm not one of them. For a variety of reasons, largely luck, I am not that concerned about house prices, so much so that I would say I don't have a dog in the fight.

It's a shame that both sides of the debate can't do anything but take extreme views. In any event, this thread has become a waste of time, you're either an idiot because you don't believe the sky is going to fall in or you're an idiot because you don't believe property is screaming buy.

moXJO · 2 April 2012

McLovin said:
The premise of the argument is that for a variety of reasons house prices can't keep rising at the pace they have for the last 15-20 years. Maybe I'm missing something but that doesn't seem like a far fetched idea.
.

No that argument is to sensible and dull.

House prices hit the wall a few years back and will probably stay flat for a bit, will see if there is a mini boom in 2015 with an even bigger boom in 2020

qldfrog · 2 April 2012

tech/a,
I am a bit puzzled when reading the recent statement in this thread that " as long as I get 10% (or whatever) of my INITIAL investment, I am happy"

Does it not make sense that if you buy a house for $100, get 10% return ($10) but the house value increases to let's say $400 yet still return $10, you should:
1) congratulate yourself to have been lucky/wise/etc on the capital gain,
2) sell the house, get the $400 and put that money on a 5% term deposit doubling your income???

We see the same thing on the stock market when people buy banks/telstra for the dividends and pretend to be in-interested by share value variations (mostly when it goes down.. )
I will not change your mind but selling now(if you can at a proper price) might be worthwhile considering IMHO
More generally

The point which is also missing from that thread is the fact that [but for a small reference to Asian investors], Aussie RE is pure internal Aussie business and so does not leverage the currently very high AUD ..
I am a bear on the australian market (yet bought recently one IP for diversification but do not expect miracle from it) but would be more positive on getting RE in the US or Europe if I could have more local knowledge, just as a way to edge the AUD...
Much easier to edge the AUD on the stock market/commodities and more liquidity: fast to act when required
Hope it helps

Starcraftmazter · 2 April 2012

Ves said:
Are you suggesting that tech/a is lying about his recent deals?

I know nothing of the details of his deals.

Julia said:
Wow, it must be great to know everything and be so totally certain about being right all the time.

I'd rather heed the wisdom of someone who has actually succeeded, rather than someone of zero practical experience sitting on the sidelines pontificating.

You don't need any experience when the bubble is this obvious:

'nuff said.

Bill M said:
The last one was when sub prime hit the USA 5 years ago. All the Aussie doom and gloomers said we are finished, it's all over, rents are going down, real estate prices will crash, it didn't happen at any of those times.

Buddy, do we really need to go over this again? Really? The government propped up the bubble with the FHOB - that's it, all over, nothing else to be said. It was nothing but a slight delay, and now prices have dropped even further and they are still dropping.

You and some others seem to think bubbles burst overnight and a $500,000 property will cost $200,000 next week. That's not how the real world works - crashes take many years to happen, decades even. Here, have a look at Japan:

You see that? That is what a crash looks like. It doesn't happen overnight. Some are quicker than others, but it takes many years. And Australian property prices will drop. Year, after year, after year, after year - for decades to come. It's simple logic.

The future of Australian property prices

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