The future of Australian property prices

[Value Collector]

In 25 years time Australia will resemble Poland 15 years ago.

Ok, as I said time will tell. You make your decisions based on that and i'll make my decisions based on Australia's population being a little larger and a little more productive and producing a lot of goods and services over that time.

 

[againsthegrain]

Ok, as I said time will tell. You make your decisions based on that and i'll make my decisions based on Australia's population being a little larger and a little more productive and producing a lot of goods and services over that time.

The way things are going everything is being produced offshore and services being outsourced there too.
Local skeleton jobs for serving cofee and stacking shelves at minimum wage just under full time hours so no benefit entitlements are given.

Population increase with basic skilled migrants who are more productive at bottom price for bottom quality, see all the mass produced matchbox suburbs produced not even 10 years ago falling apart due to cheap materials and low build quality.

This looks more like the new local generation being enslaved by debt to our new lords from up north.

 

[Value Collector]

The way things are going everything is being produced offshore and services being outsourced there too.
Local skeleton jobs for serving cofee and stacking shelves at minimum wage just under full time hours so no benefit entitlements are given.

Population increase with basic skilled migrants who are more productive at bottom price for bottom quality, see all the mass produced matchbox suburbs produced not even 10 years ago falling apart due to cheap materials and low build quality.

This looks more like the new local generation being enslaved by debt to our new lords from up north.

Well, i am sorry you see things that way, it must be debilitating, when all you can focus on is the bad.

I look at Australia and see.

- A country full of natural resources that can be exploited, offering investment opportunities, high paying jobs and services contracts, and government royalties and taxes.

- A country full of great tourist destinations, bringing in foreign income, offering more investment opportunities, jobs, service contracts and government taxes.

- A country with a clean and green food production record, with strong bulk food commodity exports, but massive room for growth in value added exports, eg wines, beer and spirits, processed and branded meats, diary products, seafood, honey, cereals and other packaged foods.

- A country with many home grown international enterprises that do business around the world, and repatriate earnings to Australia.

These are just some of the export industries, but they are complimented by all the local industries also, and the benefits flow right through the economy.

As i said i see opportunity everywhere, i have no trouble finding great investments.

I know there is a whole sub culture of people that want to sit in their basement clinging to gold bars, writing blogs about how the world is going down, but i just don't see it, every where i look in the economy i find people wanting goods and services, and people willing to work, and people looking to improve there situations by doing more business. Capitalism works.

 

[qldfrog]

Capitalism works.

real capitalism works
oligacy does not work (may it be with duopoly,tyrans, bi parties)
now where does Australia stands?
And what is the trend? i moved it twenty years ago and was able to do here what i could not do in constrained Europe;
i would not be able to repeat this anymore and by far;
the real state of Australia is half way between your rosy picture and the doom and gloom, but i definitively do not like the trend , and worse the fact that what has been done can not be undone...
low skill migration, destruction of manufacturing, IT knowledge and generally exodus of ideas

 

[Mrmagoo]

So what businesses have you started ? How many people do you employ ? What product do you create ? And to which countries do you export ?

 

[McLovin]

Deary me. There's so much doom and gloom in this thread. If you think Australia is screwed then you should see the rest of the world.

What do I see? An open, educated, prosperous country that after 200 years of being relatively isolated is now geographically placed for where the new centre of the world economy will be. I'd rather be doing anything in Australia today than 20-25 years ago when it was just emerging from being a closed shop.

 

[sptrawler]

Deary me. There's so much doom and gloom in this thread. If you think Australia is screwed then you should see the rest of the world.

What do I see? An open, educated, prosperous country that after 200 years of being relatively isolated is now geographically placed for where the new centre of the world economy will be. I'd rather be doing anything in Australia today than 20-25 years ago when it was just emerging from being a closed shop.

You hit the nail on the head there, Macca.

Mum, Dad and 4 kids in a 2 bedroom 12 square, weatherboard house. Suplimenting the food shop with, rabbit meat, not that I dislike rabbit, it just became monotonous.
Then on the weekend you all pile into the old Valiant, burn the back of your legs on the plastic upholstery and down with the windows, heaters were an option on the cars then, a/c only the rich had cars with a/c.

Ah the good old days, life was simpler, goals were much easier to set.

There wasn't any talk about buying a house, just being able to afford a reasonable car was an achievement.

Talk of buying a house came after the kids, when you had a job that the bank deemed secure enough to give you a loan, that was as long as you had 25% deposit.

 

[Mrmagoo]

You hit the nail on the head there, Macca.

Mum, Dad and 4 kids in a 2 bedroom 12 square, weatherboard house. Suplimenting the food shop with, rabbit meat, not that I dislike rabbit, it just became monotonous.
Then on the weekend you all pile into the old Valiant, burn the back of your legs on the plastic upholstery and down with the windows, heaters were an option on the cars then, a/c only the rich had cars with a/c.

Ah the good old days, life was simpler, goals were much easier to set.

There wasn't any talk about buying a house, just being able to afford a reasonable car was an achievement.

Talk of buying a house came after the kids, when you had a job that the bank deemed secure enough to give you a loan, that was as long as you had 25% deposit.

Oh that was 1989 was it ? Sounds more like 1950.

1989 Australians hunting rabbits in inner city Sydney during the stock market crash and Nintendo! Did Hawthorn also win the VFL grand final in black and white TV ?

 

[Value Collector]

So what businesses have you started ? How many people do you employ ? What product do you create ? And to which countries do you export ?

I started one business, it employed 3 people, it was involved in remanufacturing equipment that otherwise had to be imported, didn't export much, except one customer relocated to the Middle East and would still place the occasional order.

I have since sold the business and retired, and now i own shares in companies that export billions of dollars and employ thousands.

 

[Julia]

Deary me. There's so much doom and gloom in this thread. If you think Australia is screwed then you should see the rest of the world.

What do I see? An open, educated, prosperous country that after 200 years of being relatively isolated is now geographically placed for where the new centre of the world economy will be. I'd rather be doing anything in Australia today than 20-25 years ago when it was just emerging from being a closed shop.

Isn't the doom and gloom scenario a variation of confirmation bias to at least some extent? ie our world view is influenced by our personal circumstances and vice versa?

So it's more comfortable for someone who has a negative outlook, and a reluctance to observe and act on opportunities, to attribute their circumstances to a difficult environment rather than consider adjusting their own outlook and attitude.

A similar phenomenon occurs when people constantly move, only staying in one place for months or just a few years. They attribute their dissatisfaction to their environment and find various aspects of that environment to justify their unhappiness. Moving to a better place, they say, will fix their lives. It doesn't, so they move on again.

 

[Mrmagoo]

I started one business, it employed 3 people, it was involved in remanufacturing equipment that otherwise had to be imported, didn't export much, except one customer relocated to the Middle East and would still place the occasional order.

I have since sold the business and retired, and now i own shares in companies that export billions of dollars and employ thousands.

That is awesome. That is the sort of thing which should allow a person to make money, not depriving others of a place to live by using government to restrict the supply of housing.

Three people got a job vs people LOSING their jobs because of the housing industry.

 

[Mrmagoo]

Isn't the doom and gloom scenario a variation of confirmation bias to at least some extent? ie our world view is influenced by our personal circumstances and vice versa?

So it's more comfortable for someone who has a negative outlook, and a reluctance to observe and act on opportunities, to attribute their circumstances to a difficult environment rather than consider adjusting their own outlook and attitude.

A similar phenomenon occurs when people constantly move, only staying in one place for months or just a few years. They attribute their dissatisfaction to their environment and find various aspects of that environment to justify their unhappiness. Moving to a better place, they say, will fix their lives. It doesn't, so they move on again.

Don't care. Another 20 years the rich old people will all be dead and people of my generation can take the leadership to steer this country back to a capitalist one.

 

[qldfrog]

I started one business, it employed 3 people, it was involved in remanufacturing equipment that otherwise had to be imported, didn't export much, except one customer relocated to the Middle East and would still place the occasional order.

I have since sold the business and retired, and now i own shares in companies that export billions of dollars and employ thousands.

Great but so do you genuinely believe you could follow the same path today?
How the hell could you be competitive in any industry against imports with the current AUD rate and the cost of living here?
I arrived here with education and knowledge in the 90's: started as employee, then contractor/consultant building 'intelligent" software in aerospace/telco/and mining for the last 15 years(most of them for export or used in major export scheme;
Leading edge stuff, we/I took market from the US initially (aero/telco), developed genuine new R&D solutions for the mining industry; i worked for CSIRO/CSC/big corporations always as an independent for the last 15 years (so not your typical public servant/researcher); now where could I emulate such a path today?
I did well and am happy with my own situation but i really believe a lot of baby boomers live with an extrapolation of the past as a model of their view of today's world;

No research or investment money by corporate or government, extreme currency exchange issues to be competitive vs india/vietnam [where you do not pay 50% tax on your income, have to pay 9.5% super or need to pay a sparky 100$ an hour to change a switch];
The only place I could start a nice career today would probably be by reselling IP to SMSF or chinese investor; something I would say is borderline crook;
but open to suggestion? food industry?tourism
Is the company you sold still alive and making any profit?
you see my drift;
This is not all doom and gloom, but please no lessons without real analysis...and i am one of a generation who did enjoy the fruits of Keating's change and the years of plenty.
i hope this is not taken as a personal attack, it is not, i have several baby boomer in my circles and good on them!

 

[Value Collector]

not depriving others of a place to live by using government to restrict the supply of housing.

.

As a property investor, i am providing housing, not depriving them, I have bought an existing house and converted it into a duplex, providing housing for an extra family.

How much extra housing stock have you created?

 

[Value Collector]

Great but so do you genuinely believe you could follow the same path today?
How the hell could you be competitive in any industry against imports with the current AUD rate and the cost of living here?;
!

Yes, i only sold the business recently, and the business is still operating profitably under the ownership of one of my old staff, i am not a baby boomer, I am Gen Y, I am 32, I spent half my working life since i was 18 in the military and the other half in business, and have been a student of finance and investment since i was 14, and am now comfortably retired (though i prefer to call myself an investor rather than retired).

A low aussie dollar would give the business a tail wind, however quality products, good marketing, good customer service and attention to detail are far more important, its not all about price, a lot of the time its just being there when your customer needs you, offering after sales support that they wouldn't expect, i couldn't count the number of times i was at a customers site at 8.30 at night or 7.30 am on a Saturday to fit a part urgently and only made $40 gross for a couple of hours but when the next refit needed doing and the $2000 job was on the line, they generally remember me and thats what counts, not some faceless guy in china quoting $10 less, with a 7 day lag.

 

[againsthegrain]

Yes, i only sold the business recently, and the business is still operating profitably under the ownership of one of my old staff, i am not a baby boomer, I am Gen Y, I am 32, I spent half my working life since i was 18 in the military and the other half in business, and have been a student of finance and investment since i was 14, and am now comfortably retired (though i prefer to call myself an investor rather than retired).

A low aussie dollar would give the business a tail wind, however quality products, good marketing, good customer service and attention to detail are far more important, its not all about price, a lot of the time its just being there when your customer needs you, offering after sales support that they wouldn't expect, i couldn't count the number of times i was at a customers site at 8.30 at night or 7.30 am on a Saturday to fit a part urgently and only made $40 gross for a couple of hours but when the next refit needed doing and the $2000 job was on the line, they generally remember me and thats what counts, not some faceless guy in china quoting $10 less, with a 7 day lag.

That exactly the same story Tysonboss1 used to have, yet you denied posting under that username in the usernames thread.... one lie leads to another and yet another

 

[McLovin]

Isn't the doom and gloom scenario a variation of confirmation bias to at least some extent? ie our world view is influenced by our personal circumstances and vice versa?

So it's more comfortable for someone who has a negative outlook, and a reluctance to observe and act on opportunities, to attribute their circumstances to a difficult environment rather than consider adjusting their own outlook and attitude.

A similar phenomenon occurs when people constantly move, only staying in one place for months or just a few years. They attribute their dissatisfaction to their environment and find various aspects of that environment to justify their unhappiness. Moving to a better place, they say, will fix their lives. It doesn't, so they move on again.

Something like that, I think, Julia. I agree with many of the points others have made about housing being unaffordable but I also try and see the other side of the coin that Australia isn't doing too badly. In the early 1980's the comparison being made was that Australia would be the next Argentina (at the turn of the last century they were the two richest countries on Earth); a country rich in natural resources that through tariffs and poor government would strangle itself.

Today we have a vastly different economy. Industries like tourism, biotechnology and education are the result of the reforms of the 1980's and 1990's. While we have had some favourable tailwinds such as the China mining boom, it still amazes me that we have had 23 years of unbroken economic growth. Growth through the Asian financial crisis, September 11 and the GFC. Australia is one of the easiest places in the world to do business and has a well targeted skilled migration program that overwhelmingly attracts the sort of people you'd want as your neighbours. Over this extended period of prosperity we've managed to do a pretty good job of sharing the spoils, unlike other countries where the benefits of their booms have largely gone to the owners of capital. We don't have the racial/social divide of countries like the US or many European countries. It might be considered a "soft" factor, but I think social cohesion and social mobility are incredibly important; we want the best in our society to be tomorrow's leaders and we don't want the divisiveness of a society fractured along class/race/ethnicity/religious lines.

Of course we have issues, the lack of housing affordability is one and the flow of resources into housing stock that would otherwise be invested elsewhere. The complete disinterest by government to pursue genuine reform: The complete disinterest of most of the electorate to pursue any reform that means they receive less from the government. The dumbing down of the school curriculum and the rise of universities as vocational schools and my real pet peeve the constant reduction of funding to the sciences. There is definite need for reform and if we're sitting here in ten year's time and nothing has changed then we'll be in a far worse state than we are.

So we have challenges but overall, I think we are doing OK. Now I'll probably get flamed for sitting on the fence and posting about nothing to do with real estate!

 

[Value Collector]

That exactly the same story Tysonboss1 used to have, yet you denied posting under that username in the usernames thread.... one lie leads to another and yet another

???

Care to share a link.

 

[againsthegrain]

???

Care to share a link.

I could troll through alot more posts that you posted as tysonboss1 but why waste my time its obvious

 

[Mrmagoo]

Lol he bought in 2000 before the credit boom when gen y were still in school... not repeatable. Such a shame. Seemed mitivstional enough.