What is your opinion, any observations?
Regards,
MJ
Considered opinion is…maybe.
Although “crash” is an emotive word. 5 to 10% declines, worst case scenario, possible.
Hi swampy,
Probably, I should say "your prediction"I hope not!
Although Australia is in a much better position than the rest of the world, I believe that we are still not immune to what is happening to the rest of the world and depressed/lower property prices.
There are three critical areas to consider:
- Economy – How would a slowdown in other parts of the world and our rising dollar affect our economy, exports and jobs?
- Financing – Will interest rates rise or lower? Will it be more easier or more harder to find financing?
- Confidence – Australians may be cashed up and have the borrowing ability, but may sit on the sidelines because of fear and uncertainty
Regardless of what happens to the economy, people will always need somewhere to live. If there is a downturn in the economy we will likely see more people downsizing to more affordable homes, which could result in large declines in property prices in the upper end of the market.
Hi Guys,
New to this forum, very glad I stumbled upon it so far very informative..
I currently own an IP which was my first home (FHOG) renovated it (cosmetic) and have it rented out (probably around neutrally geared) currently renovating my 2nd place (more in depth reno) I have read whatever I can over the last couple of years to learn. (just some background)
My question that I have wondered for a while… Is with the general rule of thumb that property prices, on average, double every 7 – 10 years (depending on area etc)
I may have an over simplistic view.. I understand people will always need somewhere to live, investors always need investments etc etc and that prices in general of anything will rise with wages, inflation etc but how can property prices continue to rise at a rate any more than that of wages inflation etc? Surely at some point it will have to plateau out and for anyone to be able to afford to buy (and therefore keep demand up) growth will slow to that more inline with wages inflation …3-6% ?
Mathematically I dont think this equates to a price double every 7 to 10 years?
I hope that makes sense for someone to help with my conundrum and let me sleep at nighty ; )
Cheers guys
I wish it would crash, not being able to afford a place in your own country on a single but good income, is depressing
also due to my living arrangements im in a double bind.. if i own property in my name then i will be required to move out of my place due to the public housing rental stipulations.seriously, if the property market crashed in a major way what makes people think theull have jobs to sustain a mortgage.
I don't think there would be a major crash in Australia. Perhaps some declines but not a total crash
We just bought half of a duplex pair for 30.8% below the other half of the pair which sold in 2009. That must feel like a crash for the people who sold now.
In price ranges 1M+ in areas that are tied to the business cycle we have seen 50% falls in cases in QLD, mortgage belt areas not unusual to see 15-20% falls, greater Brisbane as a total market is approximately 10% down from it’s peak.
Supply of product is roughly in balance with demand or slightly under supplied with trends showing large under supply on the way, rents are your proxy for measuring this and they are healthy or better in most places in greater Brisbane. Mining regions are still going ballistic.
It’s fine to use a term like crash, pinning down to numbers and time frames is more interesting. In all matters investing and this includes market timing there are only three things that matter.
1) What do I buy?
2) How much do I buy?
3) When do I sell?If you aren’t buying residential property you are likely buying an alternative which might just be cash in the bank. All of this can be measured. I guess (predict) that people working a plan with accumulation of property for buy and hold, which is 1) well placed resi property at a good price 2) when you can comfortably afford it and 3) never (can be adjusted to suit but never is easier to measure) will continue to outperform other guessers (predictors), even if they have a plan to put forward.
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