I stumbled onto a Florida (US) real estate site todaywow is our real estate over priced, i mean OMG have a look at what you can buy around Miami.
http://www.opendoormiami.idxco.com/idx/4211/details.php?idxID=001&listingID=A1533174
Map: http://maps.google.com/maps?q=25.693903960928104,+-80.44805471049371
- Two story, 4 Bedrooms, 2 Bathrooms,1 Partial Baths - 2351 Square Ft, Year Built: 1992
- Price: $345,900 USD
- 11 Kilometres to the beach, 30 clicks by road to the centre of Miami
Or how about a 2 bedroom ocean view Apartment in Key Biscayne.
http://www.opendoormiami.idxco.com/idx/4211/details.php?idxID=001&listingID=A1621518
Map: http://maps.google.com/maps?q=25.6836070,+-80.1570300
- Ocean View, 2 Bedrooms, 2 Bathrooms - 1782 Square Ft
- Price: $899,000 USD
- Property adjoins ocean and nature reserve.
I wasnt talking specifically to you, young gun, quite a few had said the same thing.
Fair enough, good luck.
http://www.theage.com.au/victoria/housing-glut-hits-suburbs-20120707-21o6k.html
"record 55,290 unsold homes in Melbourne in June - the highest number of any capital city in Australia "
This can't be true, there is an UNDERSUPPLY of houses.
Very interesting REIV reporting today = so few auctions reported.. I can see in the next six months or so they might have to report a negative amount to keep their clearance rates for the year over 50%.
Sunshine and lollipops
MW
PS Where is Robots?
For a decade the only investment middle class people have been into is property.
New figures from Commonwealth Bank show the annual average pace of housing appreciation in Australia has been 1.8 per cent since the financial crisis, substantially below the 8 per cent average over the prior 20 years. It warned that a lower pace of appreciation was the ''new normal''.
I'm not generally one for posting sensationalist articles but this one seems reasonably balanced, albeit on the bearish side:
http://theage.domain.com.au/real-es...g-loan-repayment-disaster-20120708-21pkl.html
My emphasis added, but this is less than inflation, on average. So add in debt on top of that and the 'average' buyer since 2008 is well out of pocket. It has been 4 years now also, so it's getting harder and harder to argue that it is just a blip on the radar
Property analyst Mark Armstrong predicted appreciation would be slowest for home owners in outer suburbs, who could see negative to zero growth in values for as many as 20 years.
I think that's where the problem may lie for us, although the drop is not huge, if the growth rate is even nil or very low for the next twenty years then that is not good
I have said this all along. We may not see a 'bust' as such, but a slow decline and little to no growth until income:house price ratios come back into 'normal' is a serious possibility, especially with credit dried up
I have said this all along. We may not see a 'bust' as such, but a slow decline and little to no growth until income:house price ratios come back into 'normal' is a serious possibility, especially with credit dried up
I don't think so. People won't want large amounts of capital tied up in something that is bleeding money, especially when it becomes very obvious that it is going to continue bleeding money for most of their life. Once that really sinks in, panic selling will take hold.
Everything is connected together, I just don't see it playing out the way you've "said all along". Maybe if this was 30 years ago and we were only looking at housing in a bubble (no pun intended), ignoring all other factors.
My investment property has lost value, at least 10-15% from peak, so what ? I still paid 300% less than what it's worth now. There are heaps of people who were buying investment properties and land when I did and are sitting on heaps of capital growth - they are not in a hurry to sell. Besides, if i sell my house, there is nothing to invest in anyway, stocks - down, cash interest rates - down, so why sell? Sure there are demographics that will be in trouble, but one can't say a crash across the board is inevitable, IMO.
THE house building sector is deteriorating at a pace not seen since Australia was in the throes of recession more than two decades ago.
Read more: http://www.news.com.au/money/proper...or/story-e6frfmd0-1226422013676#ixzz20FZOtRSc
The number of homes for sale in Melbourne has soared nearly 28 per cent to record levels in the past year.
Research house SQM Research says the pressure of the extra supply is likely to push the city's house prices down $10,000 by the end of the year.
Read more: http://www.news.com.au/money/proper...or/story-e6frfmd0-1226422013676#ixzz20FZlnyc6
I think that's where the problem may lie for us, although the drop is not huge, if the growth rate is even nil or very low for the next twenty years then that is not good
Political History
In July 1985 the Hawke/Keating government quarantined negative gearing interest expenses (on new transactions), so interest could only be claimed against rental income, not other income. (Any excess could be carried forward for use in later years.)
The result was a considerable dampening of investor enthusiasm; although the new capital gains tax introduced shortly afterwards (September 1985) may have contributed too. After intense lobbying by the property industry, which claimed that the changes to negative gearing had caused investment in rental accommodation to dry up and rents to rise, the government restored the old rules in September 1987, thereby once again permitting the deduction of interest and other rental property costs from other income sources.
With the present tax treatment reinstated, the immediate effect was to further increase house prices as investors returned to the market before new construction could catch up.
The political result of this exercise was to put the subject of negative gearing practically off-limits to both major parties ever since. Neither wishes to be seen as contemplating any change to the system, for fear of what it may do to the rental market and/or the property market or building industry.
We shall see i guess. I could be wrong, but just cant see the panic selling setting in here in Aus. Either way i'm in a good spot with a nice cash reserve and no debt, it's just a matter of not guying too early
I think that's where the problem may lie for us, although the drop is not huge, if the growth rate is even nil or very low for the next twenty years then that is not good
Yes, think of all that negative gearing.... a little pointless if no capital growth is available eh? Not to mention what would happen if some government decides to eliminate it again, remember Hawkes effort in that regard... I do.
... yet there are rumblings.
Changing a status quo can be very damaging in the near term, that is why we are less likely to see this rule go but we seem to be going into "eat the rich" mode so change may be back on the table.
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