The future of Australian property prices

Bintang · 26 April 2010

robots said:
hello,

yes, thats right i didnt read it when I noticed the links to Mr Minack articles from Morgan Stanley,

now what was that back in 2008 everything was going to crash by 40-50%

even the cheek of bubblepedia to accept donations is an indicator of the things that must go on

thankyou
robots

Well I did begin my post with: "The following link might interest a few of you guys:" So you are obviously not one of the few but for someone so uninterested it is amusing how vociferously you need to advertise the fact. And before you give me the kind of broadside I see you giving other forum members I will just point out that I am not passionate about either side of this property prices debate. But I do find the discussion interesting and sometimes even entertaining.

cutz · 26 April 2010

Re: Australian Bubble Forum

Bintang said:
I have simply provided the link as information for those who might be interested.

Hi Bintang,

Thanks for the link, looks like an interesting site.

FWIW, I personally think that the oz market is in huge bubble territory, question is will it slowly deflate or crash, best case senario would be for a long term flattening with the long term average eventually catching up but I do doubt that.

A lot is at stake here.

Temjin · 26 April 2010

Here is a short video from Jeremy Grantham on "bubbles".

http://link.brightcove.com/services/player/bcpid71778049001?bclid=69928231001&bctid=79128759001

He specifically mentioned Australia of course.

And of course, the property spuikers would argue he is absolutely wrong DESPITE the fact that as a wise OLD man, extremely famous and respected in the investment community, manage over $100 billion worth of funds and had made, and was right on several occasions, predictions on previous bubbles including the tech dot com and the current GFC.

He specifically said if the Australia's property bubble did not eventually manage to burst, it would be the first in the entire 100 years of history.

But then what's the point. We all know it is impossible to sway the beliefs of the faithful property spuikers here because they simply have too much vested interests both financially and emotionally. It's human nature to reject ANY facts/evidences that does not conform to one's beliefs. Beside, riding along a bubble makes perfect rational sense , with the exception of the same belief that they could all INDIVIDUALLY get out before it burst and make their share of profit. (which technically, is impossible to happen to EVERYONE)

So enjoy the video and ignore him at your own peril.

satanoperca · 26 April 2010

Cheers Timjin for the interesting link, however, I think that Jeremy Grantham overlooked one key fact, we are different in Oz.

It seems others have housing shortages :

“The Californian Building Industry Association (CBIA) continues to express alarm over what it calls an ongoing housing crisis in Southern California. Alan Nevin, the association’s chief economist, projected in a 2006 CBIA Housing Forecast that only 185,000 to 205,000 building permits will be granted this year, far short of the 240,000 new homes needed each year.”

And from our fateful, HIA :

“The report finds that if current building trends persist, then Australia’s cumulated housing shortage would reach 466,000 dwellings by 2020… Housing to 2020, which focuses on future housing demand and the number of dwellings required in meeting this demand, highlights a current housing shortage that already numbers over 109,000 dwellings.”

Cheers

So_Cynical · 26 April 2010

Temjin said:
Here is a short video from Jeremy Grantham on "bubbles".

http://link.brightcove.com/services/player/bcpid71778049001?bclid=69928231001&bctid=79128759001

He specifically mentioned Australia of course.

And of course, the property spuikers would argue he is absolutely wrong DESPITE the fact that as a wise OLD man, extremely famous and respected in the investment community, manage over $100 billion worth of funds and had made, and was right on several occasions, predictions on previous bubbles including the tech dot com and the current GFC.

He specifically said if the Australia's property bubble did not eventually manage to burst, it would be the first in the entire 100 years of history.

Saw this video the other day and found it compelling...problem with the true believer's here as ASF is that there in bubble denial.

Bintang · 26 April 2010

satanoperca said:
Cheers Timjin for the interesting link, however, I think that Jeremy Grantham overlooked one key fact, we are different in Oz.

Yeah, that housing shortage in California was back in 2006. Maybe after that the builders pulled out their collective fingers and built like that clappers until supply exceeded demand. W'ont happen in Oz. Vive la difference !!!

cutz · 26 April 2010

So_Cynical said:
Saw this video the other day and found it compelling...problem with the true believer's here as ASF is that there in bubble denial.

The thing that gets me is that many highly geared property market speculators look at stock market investors and hedgers thinking that we are the gamblers, nothing could be further from the truth.

Some even goes so far as to mock derivative instruments, the very things that many use for protection. These same property gurus don't even realize that they themselves are sitting on unhedgable instruments of financial pain.

Talk about not being able to see the forest through the trees.

MACCA350 · 26 April 2010

Thanks for the link

This was particularly interesting:

* There is a shortage of housing

Between the last two censuses, the number of people in NSW rose by 3.8%, the number of dwellings rose by 6.1% and the number of empty dwellings rose by 13.3% to 9.5% of the total. Check the numbers for your area and list them here; OverbuildingByLocation. In fact the shortage story has been a feature of the bubble all around the world. The HousingShortage wiki page gives examples from around the world of similar claims of a housing shortage as we are seeing here. (Please feel free to add in others that you find)

Once the speculative mania has waned, the significant oversupply will become apparent.

* There is a shortage of land in Australia

House prices in Japan declined 70% over the last decade and a half. The population density in Japan is more than twenty times what it is here. Australia is one of the least densely populated nations on earth. Even if your imagination is good enough to believe that there is a shortage of land here, that will not stop the prices paid for it from becoming rational.

Data pulled from the likes of ABS

cheers

cutz · 26 April 2010

Huge LOL.

The land shortage fallacy.

Get on google earth; look down on Australia, looks like there’s plenty of land to me.

robots · 26 April 2010

hello,

yes plenty of land all around OZ, cheap as chips blocks which blow the affordability/bubble crisis out the door

go and buy a 10k or 20k or 30k block which are all over the country, just here in Victoria you can buy houses 40km from GPO in Melton for 250k, Cranbourne 280k

the bubble is in the number of bloggers who have no idea (and no money)

this is all fantastic, same arguments back in 2005 and since then my unhedged financial instrument has continued to go sky high, yeah man i am in a whole world of financial pain, hahahahahahahaha

thankyou
robots

robots · 26 April 2010

hello,

there you go:

http://www.realestate.com.au/buy/property-land-between-0-50000/list-2

heaps all around australia, go for it, plenty of variety and prices

thankyou
robots

robots · 26 April 2010

hello,

here's a ripper at Linton, 98K:

http://www.realestate.com.au/property-residential+land-vic-linton-2748688

mud brick hut, good scope to improve, get a few water tanks, solar, vegie patch, presto got a home

thankyou
robots

Dowdy · 26 April 2010

robots said:
hello,

the bubble is in the number of bloggers who have no idea (and no money)

this is all fantastic, same arguments back in 2005 and since then my unhedged financial instrument has continued to go sky high, yeah man i am in a whole world of financial pain, hahahahahahahaha

Lets answer that with a previous post from another member

Temjin said:
Here is a short video from Jeremy Grantham on "bubbles".

http://link.brightcove.com/services/player/bcpid71778049001?bclid=69928231001&bctid=79128759001

He specifically mentioned Australia of course.

And of course, the property spuikers would argue he is absolutely wrong DESPITE the fact that as a wise OLD man, extremely famous and respected in the investment community, manage over $100 billion worth of funds and had made, and was right on several occasions, predictions on previous bubbles including the tech dot com and the current GFC.

He specifically said if the Australia's property bubble did not eventually manage to burst, it would be the first in the entire 100 years of history.

But then what's the point. We all know it is impossible to sway the beliefs of the faithful property spuikers here because they simply have too much vested interests both financially and emotionally. It's human nature to reject ANY facts/evidences that does not conform to one's beliefs. Beside, riding along a bubble makes perfect rational sense , with the exception of the same belief that they could all INDIVIDUALLY get out before it burst and make their share of profit. (which technically, is impossible to happen to EVERYONE)

So enjoy the video and ignore him at your own peril.

Well, he ain't no blogger and he's got a heck of alot of money

robots · 26 April 2010

hello,

and could be managing 300 billion if made some better investments

never heard of this guy, who is he

from australia?

thankyou
robots

GumbyLearner · 26 April 2010

I have found this a useful site for Aussie expats

http://www.smats.net

satanoperca · 26 April 2010

Dowdy said:
Lets answer that with a previous post from another member

Well, he ain't no blogger and he's got a heck of alot of money

touchÃ©

cutz · 26 April 2010

robots said:
yes plenty of land all around OZ, cheap as chips blocks which blow the affordability/bubble crisis out the door

Robots,

Don't take what I said personally, it wasn't aimed at you.

What I'm getting is a lot of property investors fall for the line that there's a land shortage on at the moment, you gotta buy close to the city, population growth is on the way up and up, the big squeeze is on, building is not keeping up with demand and numerous other myths ect.ect. They fall for it, then before they know it they are up to their eyeballs in debt getting < 2% yield.

It's all an illusion.

Major capitol citys are redlining, why is it so ?

drsmith · 26 April 2010

kincella said:
I note the chinese banks are lending to them at very low rates, to buy up Australia...wish I could get my hands on loans at 2%

Apologies if I've missed it in the posts since but I'm still interested in more info on the above.

Temjin · 26 April 2010

robots said:
hello,

and could be managing 300 billion if made some better investments

never heard of this guy, who is he

from australia?

thankyou
robots

No doubt you haven't heard from him because your "investment" knowledge is pretty...well....."lacking" and "unsophisticated".

He would simply be laughing at your lowly amount of wealth and the lack of ability to make billions. Not to mention he probably make his first billion before your mother was probably even born.

Touche eh?

Sorry, off topic, just having some "fun" here. Love playing with ego though. hah

robots · 27 April 2010

Temjin said:
No doubt you haven't heard from him because your "investment" knowledge is pretty...well....."lacking" and "unsophisticated".

He would simply be laughing at your lowly amount of wealth and the lack of ability to make billions. Not to mention he probably make his first billion before your mother was probably even born.

Touche eh?

Sorry, off topic, just having some "fun" here. Love playing with ego though. hah

hello,

http://www.gmo.com/America/About/People/_Departments/BoardofDirectors.htm

there he is, and works at GMO who "manages" 107 billion of "clients money"

looks like Keen and Minick all over again,

thankyou
robots

The future of Australian property prices

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The Contrarian Averager

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GumbyLearner

satanoperca

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drsmith

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