Are you still renting?

[notpom]

Then you shall consider buying a home quick smart.

 

Avalanche of Chinese buyers is coming.

 

http://news.domain.com.au/domain/real-estate-news/chinese-share-market-offshore-investors-will-flock-to-australian-real-estate-20150708-gi7hcv.html

 

But it is not only the Chinese ones.

 

Whatever happens with Greece, Greek economy is in for a very rough ride. Did you know which city has got bigger Greek population than Athens? It is Melbourne. Sydney is not far behind. It is not a rocket science to predict huge wave of family reunions.

 

Greeks and Chinese aside, RBA for some obscure reason left the rates on hold yesterday. Good on them. I am just wondering how people do get jobs there. Apparently essential criteria is total economic incompetence.

 

It is so hard to predict what happens to our mineral exports after Chinese sharemarket lost 46% of its value over the last 2 months. Can't help whingeing - when median price of Australian property goes down 5% over ten years - it is "crash" and "catastrophy". When sharemarket crashes = correction.

 

To cut the long story short - the Chinese market crash will lead to the downturn in all resource-based economies - AU economy first of all, which will cause ASX crash (certainty - because it is GROSSLY overpriced).

 

There is going to be massive "run for safety" from the ASX as well. Plus interest rates will plummet.

 

Get prepared for the stampede.

[notpom]

RBA official thinks houses 30% undervalued. I would give it 70%.

 

http://www.smh.com.au/federal-politics/political-news/house-prices-30-undervalued-buy-dont-rent-says-reserve-bank-official-20150708-gi7p2v.html

 

[h=1]House prices 30% undervalued. Buy, don't rent, says Reserve Bank official[/h]

[notpom]

This is a crazy day today. Australian media actually started to think.

I thought thinking is already banned there because it insults majority of jornos.

 

http://www.news.com.au/finance/real-estate/dont-buy-into-housing-bubble-bullst-says-property-tycoon-nathan-birch/story-fndban6l-1227433934754

 

Don’t buy into housing bubble ‘bulls**t’, says property tycoon Nathan Birch

 

[yoda22]

No one biting today Notpom.

 

I am in two minds as to which to invest in first a rundown two bedroom unit in Parramatta for a million or

a 50% share in a chocolate teacup factory. I will consult with mystic meg and get back to you in the morning.

[notpom]

More bad news for the renters this morning.

 

http://news.domain.com.au/domain/real-estate-news/biggest-jump-in-sydney-rents-in-five-years-domain-group-20150708-gi7q92.html

 

But most remarkable - 180 degrees turn in media attitude to property. Fairfax media used to be renown leader in the inflating media bubble about mythical property bubble. Now sentiment changed to the opposite. Something divine descended on them and cured their blindness?

 

I do not think so. I would give 10% for the Government pressure. There is nothing else left apart from property market to save our economy. Perhaps they did get a proposal not to "rock the boat" or else...

 

But I would rather give 90% to the fact that their bosses finished "flight for safety" by deinvesting money from the gunpowder barrel of share market and putting it into safe property.

 

When both prices and rents growing at the same time? you need one live brain cell to comprehend the extend of property shortage in this country.

 

And things are not going to change for the better. House can be built in 6 weeks time. In SA where planning process is the easiest in AU, approval of the house (i.e. starring into paperwork) takes min 4 months - 3 months for DA approval and 1 month for Building rules approval. This is if you are lucky and Council does not request "additional information" on 29th day of the 3rd month. In this case they would have another 3 months to marinate your DA.

 

In Sydney I once had standard 3 bedder marinated for 4 years. This is standard project from reputable builder (there was 32 identical houses previously approved by the same Council). It got approved only after state Government conducted an audit and threatened to scrap planning powers from the Council.

 

AU has roughly population of New York. And the amount of bureaucracy of the whole USA. With this amount of parasites we feed it is never going to be the threat of property oversupply, because this massive parasitic apparatus spends the bulk of their time in justifying their existence.

[yoda22]

Oh its I see its a totally new paradigm, Sydney stuck down in the bottom of the planet will manage what Ireland, USA, Spain, UK, Japan and now China couldn't.

 

If you live in Melbourne or Sydney now is the worst time in the world to buy a house. Adelaide if you can get a job - fine.

With the recent comments from the Reserve Bank it seems even the driver at the wheel is even asleep which will make the drop all the bigger when it comes.

Maybe pressure is being put on 'Jornos' / editors by advertising wings of newspapers as property is such a big revenue generator.

They have changed their tune in the last few weeks ..... one must ask why ? Anyway expect double digit unemployment and a recession.

But yes Notpom eventually property years down the line will recover and move back up then I can safely remove the beer bottle from where you so kindly ask me to put it

 

http://www.creativeclass.com/_v3/creative_class/_wordpress/wp-content/uploads/2009/05/housing_bubbles_chart.png

[yoda22]

1. End in Mining Boom was 7 points of GDP slowly going to be reduced to 2 points

2. Reduction in Manfacturing

3. Contraction of services sector due to points 1. and 2.

4. Contraction in housing markets in major cities due to 1. 2. 3.

5. Increase burden in social welfare and higher unemployment rates

6. Reduction in public spending

7. Negative equity and general wallet tightening. Business close etc.

8. Recession

 

This has been in on the cards for sometime. Australia has had once in a century boom due to mining and services.

While they are not going to disappear they are already starting to contract.

Everything will be fine but prepare yourself for the next few years accordingly as it will be bumpy.

 

Right now Sydney and Melbourne house prices are over valued. You will be sitting on a purchase a few years and I think you will be in negative equity.

I am on the fence about Adelaide. Seems to be reasonable value around if you have a good / safe job and live in it and wait for the bounce back up who knows.

I am no expert. This is a forum just one mans opinion. Take it or leave it. I don't want to be negative for the sake of it. Sorry

Edited July 9, 2015 by yoda22

[RachaelOs]

Today on the radio it's been all about the unemployment figures - surely unless there's some serious investment in SA on the jobs front there's not going to be a massive housing boom - or am I missing something?

[Rammygirl]

Adelaide reasonable! Large very run down house in Toorak Gardens on sale at the moment, yes a good area and a decent plot but they want $1,000,000 for it. Even a developer won't profit from that as they won't be able to split it too much.

 

good job people are still renting though Notpom as otherwise your houses would be empty!

 

as it is we are still househunting and most of our cash is still in UK, the exchange rate has made it cheaper for us this year than last, even though prices may have risen here.

[notpom]

Today on the radio it's been all about the unemployment figures - surely unless there's some serious investment in SA on the jobs front there's not going to be a massive housing boom - or am I missing something?

Unfortunately contrary to the opinion that media attempts to nail into your head,there is absolutely no correlation between unemployment and property booms.

 

1996 property boom started when unemployment was 8.7%, but there was no boom 2008 when unemployment was just 5%.

[notpom]

Adelaide reasonable! Large very run down house in Toorak Gardens on sale at the moment, yes a good area and a decent plot but they want $1,000,000 for it. Even a developer won't profit from that as they won't be able to split it too much.

 

good job people are still renting though Notpom as otherwise your houses would be empty!

 

as it is we are still househunting and most of our cash is still in UK, the exchange rate has made it cheaper for us this year than last, even though prices may have risen here.

 

Thank you for thinking of me? but I am fine and I am going to be even better.

Thanks to the myths that media spreads, home ownership rate in this country in a steady decline. Vacancy rates everywhere you point your finger - are less than 2%. Less than 2% officially recognised as a "housing crisis".

 

You are going to do yourself a lot of harm trying to jump up to the height of $1m price brackets. You perhaps heard an expression "Property Ladder"? This is exactly what it is. If instead of one $1m house you buy 3 $300K houses, you would get two families paying off your mortgage, and tax deductions on top. Which means it will be easier to get the loan as bank would assess your rentals as an income.

Adelaide now in early stages of the boom, and shall double in price in the next 5-7 years. After that you can sell your houses for $2M, 1 M back to the bank and buy $1M house mortgage free.

 

The only flaw in that plan is that $1M house will be worth $2M in 7 years, so in reality you need to buy six $330K houses.

 

Alternative is to do nothing, and in this case iunflation will grind your today's money to dust.

[Rammygirl]

But I want to live there and there are no houses at 330 I want to live in.

[notpom]

But I want to live there and there are no houses at 330 I want to live in.

 

What can I do? Yo want to leap over tall building, I am telling you - get yourself a ladder.

Guess who will be first on the roof - the person who tries hard to jump or someone who will take a ladder option?

This is a price you pay when "I WANT" is bigger than "I need".

[Rammygirl]

Yes but in the locations we want to live $330 will not buy much at all. I agree for investment to buy cheaper, but I don't want to live where I may consider investing. It is a completely different perspective.

 

We are renting at the moment but we do actually own a property! Everyone's circumstances are different and I am not about to explain ours on here.

 

you seem to assume everyone just wants to buy for investment. Some of us just want a nice place to live, albeit with a sensible eye on the future.

[yoda22]

http://www.theage.com.au/business/property/melbourne-house-prices-tipped-to-dive-while-sydneys-climb-then-plateau-20150712-giaesx.html

[yoda22]

http://www.smh.com.au/business/property/australian-house-prices-12pc-overvalued-says-barclays-20150713-giaxaq.html