The future of Australian property prices

[sptrawler]

How long was Hockey treasurer for?

 

[satanoperca]

Who cares, he was a dick!

 

[Ann]

How long was Hockey treasurer for?

Two years 2013 - 2015

 

[sptrawler]

Who cares, he was a dick!

Jeez that's a bit rough, Parliament is full of them, to single him out is ridiculous.
The only thing he did, was call a spade a spade, which is unacceptable these days.lol
But having said that, he as many of the politicians, don't have a strong self appraisal mechanisms.
He was right saying Australians feel entitled, the problem is politicians, feel the most entitled of all. IMO

 

[satanoperca]

He was right saying Australians feel entitled, the problem is politicians, feel the most entitled of all. IMO

An there is the issue, if our elected leaders feel entitled, why should the masses behavior be any different.
An YES, he was a dick, and hardly a treasurer. Just another wanta be, who thought he was entitled. He made little, if not difference to our society.

 

[sptrawler]

An there is the issue, if our elected leaders feel entitled, why should the masses behavior be any different.
An YES, he was a dick, and hardly a treasurer. Just another wanta be, who thought he was entitled. He made little, if not difference to our society.

That would apply to all the treasurer's, since Costello, they have all been dicks.

 

[Smurf1976]

While I agree with your comments, need to put some more perspective into it:
Generation 20-40 year olds
Growing up, "You can be anything you want. You just have to work hard."

Another issue we have is that it has been so long since we had a recession that pretty much everyone under age 40, and that includes virtually all current first home buyers, has zero practical experience of a recession.

It's an alien concept they've heard reference to but have no first hand experience of. It's about as relevant a concept in their minds as WW2 or disco music. They know it was a thing but yeah, whatever, that was in a previous generation's time right?

End result is likely to be total unpreparedness for what is sure to happen at some point given the economy is cyclical by nature.

 

[sptrawler]

Further to your comments smurph, at last the truth of the situation, is starting to be acknowledged.

https://www.smh.com.au/politics/fed...ated-the-property-market-20190311-p513ak.html

People are living in a bubble alright.

 

[satanoperca]

View attachment 92656

Posted not that long ago

 

[sptrawler]

Well if everyone thought it was bad, just read this article.

https://thewest.com.au/business/hou...alls-21-per-cent-to-gfc-levels-ng-b881132825z

From the article:
New investor loans fell 4.1 per cent in January — and 28.6 per cent over 12 months — to $4.67 billion.

Now add to that, the effect that removing investors from the established homes market, this is going to be fun. I wonder if silly Billy and who cares Chris, are looking nervously at each other.

 

[Smurf1976]

Well if everyone thought it was bad, just read this article.

So new investor loans down 28% and I saw elsewhere that the total value of mortgages is down 21%. Also new car sales are down more than 10%.

It all seems a bit doom and gloom yes.

 

[Ann]

Australian property price forecasts are diverging




There is a little bit of everything for those who like to forecast Australian property prices at the moment.

If you love your doom and gloom laid on super thick, it is hard to go past LF Economics founder Lindsay David, who made the claim that prices could halve or at least fall by 40% from their peak in Sydney and Melbourne.


He claims that on a “base case’’ of a 20% price fall in the major capitals this year alone, followed by a financial armageddon in which the profitability of the big banks evaporates, properties go unsold after mortgage defaults, the residential construction industry virtually halts, unemployment soars and banks have to be bailed out or nationalised.More...

 

[moXJO]

Australian property price forecasts are diverging




There is a little bit of everything for those who like to forecast Australian property prices at the moment.

If you love your doom and gloom laid on super thick, it is hard to go past LF Economics founder Lindsay David, who made the claim that prices could halve or at least fall by 40% from their peak in Sydney and Melbourne.


He claims that on a “base case’’ of a 20% price fall in the major capitals this year alone, followed by a financial armageddon in which the profitability of the big banks evaporates, properties go unsold after mortgage defaults, the residential construction industry virtually halts, unemployment soars and banks have to be bailed out or nationalised.More...

I just don't think the government would allow it. And thats where these forecasters get it wrong.

 

[sptrawler]

I just don't think the government would allow it. And thats where these forecasters get it wrong.

My guess is Labor will backflip on the negative gearing changes, which may stop the rot, but it is hard to turn the herd when it is running.
The continuing slide in W.A property prices, shows that once the market cools, it is hard to reignite it.
W.A property has been going down for 2-3 years and though it has slowed it is still sliding.
Prices are now back to about post GFC lows.
The other problem now raising its head is Billy talking about major rises to the basic wage, which is nice, but I'm seeing a lot of small businesses going broke a major wage rise could accelerate that.
Interesting times, Labor are certainly shaking the can, the outcomes could be dramatic.

 

[Ann]

My guess is Labor will backflip on the negative gearing changes, which may stop the rot, but it is hard to turn the herd when it is running.
The continuing slide in W.A property prices, shows that once the market cools, it is hard to reignite it.
W.A property has been going down for 2-3 years and though it has slowed it is still sliding.
Prices are now back to about post GFC lows.

If the government does away with SMSF under $500,000 then there will be a lot less investment in property. I saw figures once that the average SMSF has one investment property and some cash and a few shares. If this sort of SMSF is outlawed then there will be a much smaller market for property. This could see a real drop in demand and potentially a flow through into falling prices.

AustralianSuper declares war on SMSFs

AustralianSuper chief executive Silk will today call for a clampdown on self-managed super in response to the Productivity Commission's finding that SMSFs with less than $500,000 tend to perform "significantly worse" than regular super funds.

Mr Silk, who runs the nation's biggest super fund with $145 billion under management, will tell the Conference of Major Super Funds on the Gold Coast that an inquiry is needed into SMSF performance, and that the probe should lead to a "revamped and smaller SMSF sector" with tighter regulatory safeguards.

 

[sptrawler]

If the government does away with SMSF under $500,000 then there will be a lot less investment in property. I saw figures once that the average SMSF has one investment property and some cash and a few shares. If this sort of SMSF is outlawed then there will be a much smaller market for property. This could see a real drop in demand and potentially a flow through into falling prices.

AustralianSuper declares war on SMSFs

AustralianSuper chief executive Silk will today call for a clampdown on self-managed super in response to the Productivity Commission's finding that SMSFs with less than $500,000 tend to perform "significantly worse" than regular super funds.

Mr Silk, who runs the nation's biggest super fund with $145 billion under management, will tell the Conference of Major Super Funds on the Gold Coast that an inquiry is needed into SMSF performance, and that the probe should lead to a "revamped and smaller SMSF sector" with tighter regulatory safeguards.

The industry funds have been chasing the retirees from SMSF's for years, it is a really big sector and the industry funds want the money in their coffers, that is the driving force behind Labor's changes.
I would rather spend it, than give my money to someone else to look after, how many have lost their money through bad managers? FFS we just had a royal commission highlight it.
Now they want to legislate so someone else gets YOUR money, as I've already said the younger ones are going to lose out big time with all of the proposed changes coming up.
The problem is no one is thinking of the long term ramifications, of the changes, but that's the way it goes.

 

[sptrawler]

Even though house prices in Perth, have fallen back to GFC levels in W.A, the slide isn't stopping.
Houses haven't been this affordable for years, but people still aren't buying, I don't think this is going to end well.lol

https://thewest.com.au/business/hou...rket-still-has-further-to-fall-ng-b881135449z

 

[PZ99]

Perth is looking better for me each month. Wouldn't mind having the market open at 7am

 

[satanoperca]

Ann, the real question is how much leverage into property are SMSF in?

If the figure is large, this would be another attributing factor to why property increased so much in the last 10 years. If this pool dries up, yes we could expect property to fall further.

 

[satanoperca]

Even more interesting:
"
The ATO's next focus would be on rental income and deductions, with auditors having now completed over 300 audits on rental property claims and found errors in almost nine out of 10 returns reviewed, he said.

"We're seeing incorrect interest claims for the entire investment loan where it has been refinanced for private purposes, incorrect classification of capital works as repairs and maintenance, and taxpayers not apportioning deductions for holiday homes when they are not genuinely available for rent," Mr Jordan said.

"When you consider that rentals include over 2.1 million taxpayers claiming $47.4 billion in deductions, against $44.1 billion in reported income, you can get a sense of the potential revenue at risk."

https://www.abc.net.au/news/2019-03...-post-panama-papers/10899518?section=business