The future of Australian property prices

[prawn_86]

RBA essentially admitting that the housing boom was based on access to easy credit and that unlikely to grow like that again in the foreseeable future:

http://www.abc.net.au/news/2013-04-24/strong-house-price-growth-a-thing-of-the-past/4648580

 

[sydboy007]

RBA essentially admitting that the housing boom was based on access to easy credit and that unlikely to grow like that again in the foreseeable future:

http://www.abc.net.au/news/2013-04-24/strong-house-price-growth-a-thing-of-the-past/4648580

If Ridout and her mates at the AIG have any say in it the RBA will have rates so low as to encourage property speculation on a grand scale.

 

[Julia]

If Ridout and her mates at the AIG have any say in it the RBA will have rates so low as to encourage property speculation on a grand scale.

Heather Ridout is no longer with the AIG. Now heads up Australian Super. She's also a member of the RBA herself.

 

[Mr Z]

RBA essentially admitting that the housing boom was based on access to easy credit and that unlikely to grow like that again in the foreseeable future:

http://www.abc.net.au/news/2013-04-24/strong-house-price-growth-a-thing-of-the-past/4648580

Yes, total outstanding debt matters as much as rates. After all you can only service so much no matter how low the rate. We will not do this again until debt levels reset.

 

[sydboy007]

Heather Ridout is no longer with the AIG. Now heads up Australian Super. She's also a member of the RBA herself.

yes, but I'm sure she still lunches with plenty of the heavies at the AiG.

Now she has direct input into determining interest rates, and she's been pretty much constantly saying we need them lower.

 

[sydboy007]

Yes, total outstanding debt matters as much as rates. After all you can only service so much no matter how low the rate. We will not do this again until debt levels reset.

The problem is they haven't. Household net debt has barely budged from the pre GFC highs. A least the USA has seen a decent drop in debt levels. They could have a reasonable swing up in housing prices before getting back to their previous highs.

I do wish the MSM would start to focus on private sector debt, especially households, as it is going to be THE problem than undermines things rather than Govt debt.

 

[DB008]

The problem is they haven't. Household net debt has barely budged from the pre GFC highs. At least the USA has seen a decent drop in debt levels. They could have a reasonable swing up in housing prices before getting back to their previous highs.

I do wish the MSM would start to focus on private sector debt, especially households, as it is going to be THE problem than undermines things rather than Govt debt.

And here is the rebuttal......

http://www.dailytelegraph.com.au/money/money-matters/australians-saving-more-than-ever-but-some-more-than-others/story-fn300aev-1226628719943

WE'RE saving more than ever and are less worried about debt and our mortgages with the average Australian household managing to triple savings in the past two years.

The latest ING DIRECT Financial Well-being Index has found Australians are not only more confident with their mortgages, but have become better at managing their finances better as well.

And while Australia remains one of the most expensive countries in the world, it seems we're getting better at saving with the average household having around $15,427 in the bank in the first quarter of this year, up more than $5000 compared to two years ago.

Well at least that’s the case for some of us anyway.

If you’re South Australian and aged between 35 and 49 it's more than likely you're not saving as much as some of your countrymen.

According to the index, Gen X (35-49) are saving the least with a median savings bank of $8060 compared to $14,377 for Gen Y (18-34) and $17,744 for baby boomers (50-64).

 

[sydboy007]

And here is the rebuttal......

http://www.dailytelegraph.com.au/money/money-matters/australians-saving-more-than-ever-but-some-more-than-others/story-fn300aev-1226628719943

Not from what I can see

I'm surprised that Korea seems to be in a worse position than Australia, while the Netherlands is just too horrific to consider.

 

[FlyingFox]

And here is the rebuttal......

http://www.dailytelegraph.com.au/money/money-matters/australians-saving-more-than-ever-but-some-more-than-others/story-fn300aev-1226628719943

What's an extra 5 grand next to a 500K mortgage?

 

[DB008]

I have been looking at Sydney suburbs of North Parramatta, Clyde & Auburn the last 2 - 3 weeks - sub 300k (basically units).

Anything decent hitting the market has been gobbled/snapped up within a week (7 days), if not less.

Property market dead? In some parts of Sydney, l think not!

 

[Bill M]

I have been looking at Sydney suburbs of North Parramatta, Clyde & Auburn the last 2 - 3 weeks - sub 300k (basically units).

Anything decent hitting the market has been gobbled/snapped up within a week (7 days), if not less.

Property market dead? In some parts of Sydney, l think not!

Totally agree. I am looking at buying a 2 br unit on the Northern Beaches of Sydney, everytime I check back after a couple Months prices have gone up from the last time. As you say, if anything decent comes up it's gone in no time.

 

[ftw129]

For those with a long term view..... The best time to buy property has and always will be, now.

Trying to time the property market is like trying to catch the Easter Bunny.

We may see another 20% upside before we see any reasonable pullback. Then, if prices retreat 30% from there it will be called a "crisis"!

The smart ones are taking advantage of these ultra low interest rates.

 

[So_Cynical]

My mum has her house on the Market again, third time unlucky in 4 years..its been 6 weeks since the agent put it online and in the papers, not a single inspection or inquiry and that's with a 60K price reduction from the last time she had it on the market 2 years ago.

Now keep in mind that my mum is a real estate millionaire and has bought and sold at least 20 houses over the last 30 years, even built 3 spec houses back in the early 2000's..she knows what she's doing, well did know..its all different now...she has never owned a house she couldn't sell before.

 

[sptrawler]

Well SC, it just shows the two speed economy.
The street I live in Perth, two years ago same for same they were selling for $600k, today $800k.
It is stupid, people have lost the plot.

 

[So_Cynical]

Well SC, it just shows the two speed economy.
The street I live in Perth, two years ago same for same they were selling for $600k, today $800k.
It is stupid, people have lost the plot.

Mum lives in Busselton WA...its a no speed economy there, even though there is like 6 FIFO flights per week.

 

[Tink]

Totally agree. I am looking at buying a 2 br unit on the Northern Beaches of Sydney, everytime I check back after a couple Months prices have gone up from the last time. As you say, if anything decent comes up it's gone in no time.

A friends daughter is going through the same, here in Melbourne. They are getting married next year, and have been in search for a house the last 4 months, every home they like gets sold before they can bid.

http://www.reiv.com.au/en/Property-Research

 

[moXJO]

Mum lives in Busselton WA...its a no speed economy there, even though there is like 6 FIFO flights per week.

Bit of nerves when it comes to areas that rose off the back of the mining boom. Times and strategies have changed a bit. And a lot of big investors are flogging off (or did so the previous few years) a lot of property. One currently is selling off a few of his big commercial properties.
It's a mixed market and investors a lot more fussy on what they are picking up. Some areas have dropped a bit and IMO wont come back for a long time. Others close by to the good life are being snapped up. My only regret is I didn't snap up a couple more last year when people were selling at stupidly low prices in my area. Prices have now come back.

 

[sydboy007]

from macrobusiness today

quite agree with their summary:

For what it is worth, my tip is that Australian housing values will ultimately revert to around 2.0 times GDP – the level that existed prior to the huge run-up in housing values from the mid-1990s – as price growth going forward fails to match growth in GDP (i.e. the “slow melt” thesis).

 

[Mr Z]

A friends daughter is going through the same, here in Melbourne. They are getting married next year, and have been in search for a house the last 4 months, every home they like gets sold before they can bid.

http://www.reiv.com.au/en/Property-Research

The lower end seems to be moving OK everywhere I look, kids moving up and boomers moving down. It is when you look up the scale areas seem to be struggling. Don't mention sea and tree change destinations!

 

[sptrawler]

Mum lives in Busselton WA...its a no speed economy there, even though there is like 6 FIFO flights per week.

I was down that way a couple of weeks ago (daughters wedding)
There has been a huge amount of development in that area, with no industry to support it.
There are only so many fifo jobs. My guess is Busselton area has enough housing stock to last 20 years.