That's what the stock exchange is for isn't it; the worst possible times are the best possible time......to invest.
The future of Australian property prices
- Thread starter Joe Blow
- Start date
On the bigger picture what are the consequences of ever accelerating property prices. ?
Consider these points.
Seven downsides to Australia’s dangerous property obsession | Satyajit Das
Home ownership creates unbalanced growth and deceptive prosperity while contributing to structural problemswww.theguardian.com
some pretty good points, IMO
that's actually how I think .... what % of my income am I spending on rent? what % can I afford for my car repayments, etc. The % value makes more sense to me. Even with all of this talk of 'I bought for $xxx and its now worth $xxx' is meaningless to me most times. I want to know what the CAR is on that. Even then, that return doesn't reflect all of the capital injects into upgrading/maintaining the house, or the associates taxes/fees for owning the property/land. An index fund tends to return the same or better but without the massive overhead. But I am admittedly biased towards trading shares over owning property.
Are you currently renting??
Some argue rents can be just as much as mortgage repayments so why not build the equity in the house.
wayneL
VIVA LA LIBERTAD, CARAJO!
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Yes very similar stories, I think New Farm is worth more in total property value tho.
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That is so true, but it is the narrative the media run, it is as though aliens are coming here and pushing up the house prices in Melbourne and Sydney, or some house price fairy is doing it.
People are just stupid they follow the media narrative like sheep, they blame immigrants, then house prices still go up when there are no immigrants.
Then they blame investors, when investors make up a small part of the buyers, but they always use Sydney/Melbourne as the norm, when it isn't.
Why don't people start and look at themselves, there are other things to invest in other than houses in Sydney and Melbourne, but no they have to keep bidding them up and complaining about what they have to pay.
FFS if they were share investors and complained endlessly about buying at the top of the market, everyone would laugh at them.
Like you say this is an investment forum, if you can't see a bad investment from a good investment, best you get into something else rather than going on about it endlessly on here.
Would I buy a house in Melbourne or Sydney if I couldn't afford it? No, would I buy it as an investment? No, why not? because it is just keeping the weather off someone, it makes nothing it derives income from hoping someone wants to live in it and pay me a stupid amount of rent to do so..
There is an old rule of thumb, of 100 people only 6 will become rich, the majority will be poor because they make poor life decisions.
Should we subsidies the people who decide to buy houses in Sydney/ Melbourne, if there is a housing crash, if yes is the answer, why don't we subsidise share investors that lose money?
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It can be. Though when using 4-5x my salary, I would likely have to live within a place that I just wouldn't want to live in. Or perhaps go for an apartment (though owning an appartment carries its own issues). I'm not particularly precious either as I've lived in all kinds of places in my life. Typically, I have a rather mobile life as well (moving between different states and countries due to my careers), which also means a house is less suitable.
There is no one size fits all. Not everyone has the time or inclination to learn how to trade shares. And as you mention, some can get a mortgage for roughly the same amount they pay in rent, in which case it makes sense.
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If you have some mates, wouldn't it be better to share a house? You can usually get a much better and bigger house for @1,000/wk that $500/wk
Mobility is a huge issue, you better like where and who you live with when buying a house. Definately losses of freedom getting a mortgage but you do gain other freedoms for example I can collect more things and set up more things within the stability of owning a house. I built a massive obstacle course for my dogs in the back yard I also use for body weight exercises it cost bugger all using scrap materials but I doubt you would do it in a rental. Hell you are lucky to have a pet rock let alone a pack of monster dogs in rentals. Even something as simple as planting a tree or garden or building a shed or outdoor pizza oven is work you will get to enjoy the benefits of for years. I can't imagine you get that renting.
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In my early days of property investment, I went halves with a really good mate, we shared the load and when the pot was worth enough that we both could move on independent of each other, we did.
We started by buying lawn mowers from garage sales, doing them up and onselling, then moved on to picking up cars from auctions, hone, new rings, big ends, bog and respray, then flip them. ?
Jeez today you couldn't sell a lawn mower and better cars than we bought at the auctions are left on the side of the freeway with orange abandoned stickers on them, but people are doing it so tough.
Sounds like a fun time that paid off. Probably harder to replicate now for a young guy.In my early days of property investment, I went halves with a really good mate, we shared the load and when the pot was worth enough that we both could move on independent of each other, we did.
We started by buying lawn mowers from garage sales, doing them up and onselling, then moved on to picking up cars from auctions, hone, new rings, big ends, bog and respray, then flip them. ?
Jeez today you couldn't sell a lawn mower and better cars than we bought at the auctions are left on the side of the freeway with orange abandoned stickers on them, but people are doing it so tough.
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Certainly would be, most these days seem to want it to just happen, because "hey I'm special".
Here is my first house, bought for cash and after two years of hard work tripled my money, had a wife and three kids in there, while I was making it first liveable and then sellable. It didn't come with a bathroom and had a 2.5mx 2.5m hole in the middle of the house because they don't transport the bricks, so the lounge fire and kitchen stove chimney and base didn't come. ?
Probably hard to replicate now for a young guy, because it is Flucking hard work and a lot of sacrifice, arguments and tears.
By the way it was pizzing down when it arrived with no roof on, so all the old plaster was sagging and falling down, it was two years of hard work to make $30k profit.
It's those memories and struggles that make life worth living.
Incidentally a guy down the road from me has a old house buying, moving and re-stumping business, weird way to make a living.
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You're dead right and it makes you a bit cynical when young people tell you they can't afford a house, there are a lot of these sort of houses that are now free, just pay the jinkering cost. I paid $14,000 in 1982 for the house, that was about twice the cost of a Commodore, so say $60 - 100k today, then I paid the jinkering cost on top.
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Haven't looked into it enough to make a decision but I could buy an old house from the guy less than 5km down road and have him install it on my property as a guest house or buy one those. brand new fairly luxurious transportable homes with all the mod cons commonly seen on mining sites. I'm yet to work out the pricing.
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I sit right in the middle on this, from one side I see some of this as being out of touch from the boomers point of view, but from the other side I definately think the "young" people or majority of them have ridiculous expectations. Is there any normal people left in this country? ? But if there is still any normal people that don't have high expectations I still think it is very hard for them and not easy to pack up your family and leave melb or syd, but this argument goes in circles, im no longer that passionate on it anyway.
What I do agree on here is why we need to keep bailing out and babying those in melb and syd. Saw some chick on news saying how ohhh nooo her mortgage payments are up and food bills are already high... "ahh then get a better job mate"
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Absolutely, if getting an easy comfortable life didn't include any sacrifice, that would be great.
Everyone would be given a house and be on welfare, so who pays for it and who takes out the rubbish and collects it, who goes to work, why bother?
Way too many high paid media personalities telling people life should be easy, like they have it, talk $hit on T.V for 3 hrs a day for $3m a year yep life's good.
There is a huge shock coming for Australia, sooner or later.
I have looked and that is what I have thought about too. Rent out the other rooms to help. But I also don't count on those things. I also share my current rental to save more on costs (I save the money and will put it to starting up new systems to trade).
But you are definitely correct. I also see the market as just being well over-valued so right now I can rarely justify it. It's also only up to this time year that I left my job that had me move every year or two for work. Now that I am in a stable location and job, I'll start looking more seriously.
That's what I would love. The freedom to make changes to the house. I also love pets, but in a rental I'm just not willing to do that. All your points are valid (pizza oven, makeshift upgrades to the place, etc.). It's why I will eventually own, but in the meantime it just hasn't been viable. If the market finally cools then I will look more seriously.
Certainly not disputing what you're saying but it hasn't been right time with my particular circumstances.
And agian, I prefer putting my money into shares and trading systems. lol
