The future of Australian property prices

[SirRumpole]

Payroll tax is the most stupid tax in existence.

I thought it was supposed to go when the GST came in.

 

[SirRumpole]

Maybe it would be better used to help those who don't have a home get one rather than handing it to the investors investing in property.

Sure. I have no interest in negative gearing, get rid of it completely for all I care, but the Libs won't do that because it's their voters getting the benefit, and Labor are afraid of being attacked for "politics of envy", so if you can persuade either party to ditch NG then good on you.

It distorts the market. If people want houses built and can afford them, then they will be built.

 

[Smurf1976]

Payroll tax is the most stupid tax in existence.

I thought it was supposed to go when the GST came in.

There are many misconceptions about what was "supposed" to happen when the GST came in.

Ultimately most of those "supposed to happen" things were based on a GST of 15% but our politicians in their wisdom decided to go for a GST at 10%, exempt a few things, and keep various other separate taxes.

 

[sptrawler]

Maybe it would be better used to help those who don't have a home get one rather than handing it to the investors investing in property.

Like a government loan scheme in some form or another, or government owns x% of the house to be repaid when said house is sold...use it to get the pemanent renters out of the forever renters cycle as opposed to giving it to property investor.

I think we are a voice in the wilderness willy, obviously no one really gives a rats about renters and low income poverty pits. lol
I think it makes perfect sense, for the Government to get involved in joint owner ship, to me it makes a lot more sense than throwing money at the private sector.
All they will do is crank up rents to make the 20% less than market, the same as what the market rent was pre introduction of the scheme.

Also the naysayers that say it can't work, should maybe have a look at Singapore, they have a Government/ private home loan system. Funnily enough Singapore has 90% home ownership.
Like I said, I think we are wasting our breath.

 

[satanoperca]

I think we are a voice in the wilderness willy, obviously no one really gives a rats about renters and low income poverty pits. lol
I think it makes perfect sense, for the Government to get involved in joint owner ship, to me it makes a lot more sense than throwing money at the private sector.
All they will do is crank up rents to make the 20% less than market, the same as what the market rent was pre introduction of the scheme.

Also the naysayers that say it can't work, should maybe have a look at Singapore, they have a Government/ private home loan system. Funnily enough Singapore has 90% home ownership.
Like I said, I think we are wasting our breath.

You just do not give up. The current system works for the low income earners, NOT, but those low incomers on $150K a year should be able to get ahead.
So what is your alternative, the same or an alternative.

As for Singapore, you need to live there first and understand the demographics. You make me laugh, go back to wiring houses as long as they don't need any voltage they should be okay.

 

[sptrawler]

You just do not give up. The current system works for the low income earners, NOT, but those low incomers on $150K a year should be able to get ahead.

You still have to miss quote, to try and make sense, try reading slowly.

 

[Smurf1976]

In my view a spectacular bust is not in anyone's best interest apart from a small minority of cashed up investors waiting to buy.

For businesses and workers it's a pretty sure way to bring on a recession with all that entails - business failures and mass unemployment.

For the banks it's a problem if they suddenly find themselves with lots of mortgages which are in practice partly unsecured since the property is now worth considerably less than debt.

The problem is the scale of the bubble. Any solution is going to need a very careful and pragmatic approach to bring prices down slowly and steadily over an extended period. Realistically, with the scale of the problem if it can be cleaned up within a decade then that's about the best we can hope for. I say that as someone who tends to want things done yesterday but in this case it's just not practical and the risk of ending up with an outright crash is real and dangers.

 

[luutzu]

In my view a spectacular bust is not in anyone's best interest apart from a small minority of cashed up investors waiting to buy.

For businesses and workers it's a pretty sure way to bring on a recession with all that entails - business failures and mass unemployment.

For the banks it's a problem if they suddenly find themselves with lots of mortgages which are in practice partly unsecured since the property is now worth considerably less than debt.

The problem is the scale of the bubble. Any solution is going to need a very careful and pragmatic approach to bring prices down slowly and steadily over an extended period. Realistically, with the scale of the problem if it can be cleaned up within a decade then that's about the best we can hope for. I say that as someone who tends to want things done yesterday but in this case it's just not practical and the risk of ending up with an outright crash is real and dangers.

Would be good to know how much of the toxic mortgage the big four have already offloaded to "sophisticated investors" in the new version of CDOs.

Read some years ago they started doing it, offloading to Japanese, and maybe Chinese, managed funds.

There would be at least a couple smart bankers pulling a Goldman Sachs this time round right?

But yea, a property crash wouldn't benefit anyone but those with ready cash and strong credit.

 

[sptrawler]

It may not be as bad as we think, who knows?
All we are doing here is throwing our thoughts around, I'm sure other than the few of us on the forum, no one else thinks or even cares about it.
We certainly aren't here to form a G20 forum.

 

[luutzu]

It may not be as bad as we think, who knows?
All we are doing here is throwing our thoughts around, I'm sure other than the few of us on the forum, no one else thinks or even cares about it.
We certainly aren't here to form a G20 forum.

We plebs are here to try and save the world.

Those suits at the G20 get together to figure out how to steal more of the damn place.

Guess who's winning?

You about the Yellow Vest current plan to do a run on the banks in France?

Heard they plan to ask the French to all go to the branch and withdraw their cash as a protest.

The current global credit/asset bubble haven't burst yet and revolution's already brewing. Might not be too much fun for WEstern civilisation if the proverbial hits the fan soon ey.

 

[Sdajii]

Yea, true. Though wouldn't the Mode be more representative? It's been a while since my stats years.

It shows. With something like income, the mode would be irrelevant unless you arranged the incomes into lumped categories, which would be a laborious and pointless extra step, and probably would give you a result heavily skewed to poverty. You'd almost certainly come up with minimum full time wage. Median is the appropriate one to use.

I was referring to "per capita"... that's an average still popularly used to show how rich we're all getting each time the Gates and Murdoch of the world gain a few hundred million dollars.

That's mean (not 'you're mean' mean, statistical mean, ie., what most people mean when they say average. Gee, I just used the word mean in three different ways without using it. I really wish language was better designed). It would be stupid to use that. That's why it's never used in situations like this.

btw, did you know that the top 10% of the US own some 87% of all the listed stocks? The top 1% own some 40%?

Wouldn't it be cool if that's changed?

Not as cool as irrelevant trivial no longer being brought up by cowards trying to use it as distractions, but yes, it would.

 

[Darc Knight]

I think we are a voice in the wilderness willy, obviously no one really gives a rats about renters and low income poverty pits. lol
I think it makes perfect sense, for the Government to get involved in joint owner ship, to me it makes a lot more sense than throwing money at the private sector.
All they will do is crank up rents to make the 20% less than market, the same as what the market rent was pre introduction of the scheme.

Also the naysayers that say it can't work, should maybe have a look at Singapore, they have a Government/ private home loan system. Funnily enough Singapore has 90% home ownership.
Like I said, I think we are wasting our breath.

You're a funny bugger at times Homer. I'm not even going to try and argue with you. You're retired, you can type, Corgi at your feet while your Servants bring you cups of tea and nourishment. Heck, I'll bet you even get the Butler to post while you duck off to the Can

 

[sptrawler]

You're a funny bugger at times Homer. I'm not even going to try and argue with you. You're retired, you can type, Corgi at your feet while your Servants bring you cups of tea and nourishment. Heck, I'll bet you even get the Butler to post while you duck off to the Can

There is nothing wrong with stimulating discussion, too many are too ready, to parrot what the media want to feed them.IMO
"Here, chook, chook ,chook", is the call of the day, free thinking is a thing of the past.
Too many uni graduates with Arts degrees, got sod all better to do, than sit and write blogs to the SMH.

 

[Junior]

In my view a spectacular bust is not in anyone's best interest apart from a small minority of cashed up investors waiting to buy.

For businesses and workers it's a pretty sure way to bring on a recession with all that entails - business failures and mass unemployment.

For the banks it's a problem if they suddenly find themselves with lots of mortgages which are in practice partly unsecured since the property is now worth considerably less than debt.

The problem is the scale of the bubble. Any solution is going to need a very careful and pragmatic approach to bring prices down slowly and steadily over an extended period. Realistically, with the scale of the problem if it can be cleaned up within a decade then that's about the best we can hope for. I say that as someone who tends to want things done yesterday but in this case it's just not practical and the risk of ending up with an outright crash is real and dangers.

Stagnating prices or low growth over an extended period, coupled with wages growth over that same period, would be a best case scenario. We will probably need very stable mortgage rates to achieve this.

Easier said than done.

 

[Darc Knight]

• Australia’s construction sector went from bad to worse in late 2018.
• Activity levels declined at the fastest pace in over five years. For the residential sector, particularly for apartment construction, activity levels basically collapsed.
• Weaker conditions were also seen across commercial and engineering construction.
• New orders — a lead indicator on activity levels — also fell at a faster pace. Declines were seen across all parts of the industry.
• Analysts say the downturn will ultimately weigh on the broader Australian economy

https://www.businessinsider.com.au/australia-economy-gdp-housing-market-downturn-2019-1

 

[sptrawler]

Well everyone seems to have gone quiet on the NG issue, so what does everyone think about the proposed changes to capital gains.

Wow make a profit of $100,000 on an investment, get $75,000 chucked on top of your wages.
That's a good incentive, to build that beautiful NG geared property, to rent out. Priceless.

Well that should get some posters falling from the rafters.
Especially those who buy shares to make money, what if you make $100,000 you pay tax on $75,000.
If you lose $100,000, you can keep that to yourself, until you make $100,000 profit.

 

[sptrawler]

I work with people who have multiple degrees and more and are not in the over $110K pay bracket.

I employee people overseas who have far more qualifications and skills than the average joe in Australia and do not even earn close to the $80K AUD.

Hate to go back to old posts, but this one of yours, I found interesting.

I was reading in the SMH, that Sydney's train drivers get $130,000/pa, with no qualifications, obviously the degrees aren't worth much.

https://www.smh.com.au/business/wor...ning-more-than-a-dentist-20190107-p50py7.html

Or you work at a place, that pays $hit wages.

 

[Junior]

Well everyone seems to have gone quiet on the NG issue, so what does everyone think about the proposed changes to capital gains.

Wow make a profit of $100,000 on an investment, get $75,000 chucked on top of your wages.
That's a good incentive, to build that beautiful NG geared property, to rent out. Priceless.

Well that should get some posters falling from the rafters.
Especially those who buy shares to make money, what if you make $100,000 you pay tax on $75,000.
If you lose $100,000, you can keep that to yourself, until you make $100,000 profit.

I'm very much opposed to this policy. I don't see what the issue is with the current system.

If you hold an asset long term, even if the value only grows with inflation, you'll be hit with a big tax bill following sale. I feel as though this policy will simply encourage people to hold investments until retirement or death, purely to ease the tax burden upon sale. Is that a good thing?

 

[sptrawler]

I'm very much opposed to this policy. I don't see what the issue is with the current system.

If you hold an asset long term, even if the value only grows with inflation, you'll be hit with a big tax bill following sale. I feel as though this policy will simply encourage people to hold investments until retirement or death, purely to ease the tax burden upon sale. Is that a good thing?

I think it will discourage people from investing in the first place, especially when interest rates get back to normal.

 

[SirRumpole]

Not directly related to prices, but certainly a matter of concern:-

https://www.theguardian.com/austral...vernment-for-failure-to-reform-building-rules