No.
It is well known that real estate doesn't fare that well in an aggressively inflationary environment, it becomes impossible to keep rents in line, historically they have always lagged. That is where we are headed... like it or not.
And of past and projected growth in yeild. had many rental increases of late?
And the Howard Government.
they changed CGT to favour shorter term speculation and disadvantage longer term investment.
No.
It is well known that real estate doesn't fare that well in an aggressively inflationary environment, it becomes impossible to keep rents in line, historically they have always lagged. That is where we are headed... like it or not.
Yes yes prices run alot harder than rents in such times i agree. but as of late it has been rents who have been outpacing prices though looking forward to where you think we are headed though a leveraged property investors dream. unless of course your thinking property wil be immune to the inflation? either way most data including what you have provided is illuding to the opposite like it or not.
Yes, property will be to some degree immune. Property thrives in low and constant inflation where growth exceeds or meets the rate of inflation. When you hit stagflationary conditions and inflation is outpacing growth then property suffers and very much lags. This is simply because it is leveraged and the ability of the average person to pay interest is limited by the rising cost of staples against stagnating or evaporating wages. You also reach the point where the central bank moves to contain inflation and pushes rates to nose bleed levels.... that is the time to buy, just before rates top.
Property works most of the time, in "normal" inflationary conditions... it is simply a leveraged bet that inflation will continue, normally a no lose proposition BUT once inflation starts growing too quickly and growth suffers then the dynamic fails, as it does under deflationary conditions (not likely aside from specific market deleveraging). IMO it is not as simple as inflation or deflation, the dynamic is a little more complex than that but for the sake of this discussion.... YES I beleive we will see inflation that we exceed properties ability to maintain its current price levels especially when you consider the historically high debt levels we are starting with. You can only borrow so much, even @ 0% you must be able to cover principle. As a group Australians have pushed this debt limit... this is changing... as per the RBA credit growth chart... it counts, even if you don't like the idea. Shrinking credit will equal shrinking prices.
Ok can someone please explain to me why everyone on this forum seems to think every property on oz has a substancial morgage attached?
Doesn't need to be every, just enough to make a difference to the stock on market.
Hint: its not enough
Falling house prices say otherwise.
If you think defaults are the sole reason for the current lower prices well there really is no hope for you. But thankyou for yet another exellent example of confirmation bias.
I never said anything about defaults, stop putting words in other peoples' mouths.
What exactly were you saying/insinuating then?..........
This should be good, keep in mine everyone can read your previous posts.
its not enough,
Falling house prices say otherwise.
You forgot the most important bit what were you insinuating when you then posted the above?
No, I'm pretty sure my previous post covers that pretty well.
It does just wanted to be clear that that is your conclusion to what has driven the price of oz realestate down.
The Age reports a clearance rate in Melbourne of 40%
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