Forum Replies Created
- Originally posted by voigtstr:Are you a Joss Whedon fan by any chance?
[offtopic][biggrin]
Buffy etc tired me after a time, but Firefly is probably the closest thing to a perfect tv series for my tastes I’ve ever seen. Have you seen Serenity yet? Who knows when it’ll arrive in my 2 horse town…Seems the aurhor is not sure of Foundation’s abilities and has asked for proof whereby Foundation predicts tomorrows gains. I am sure we would all enjoy that test however I don’t expect anyone to perform under those conditions!Dang! Seems I missed a dirty post! For what it’s worth Blogs, those 3 companies are all I’m holding directly ATM. Up again Friday, then again today. I’m still holding. I have stops in place under the oils, but I’m happy for gold to stay volitile. I’m in it for the long term…
Hey Glen, I hope you’ll share your clock with us when you’re done. Or write a book.
Cheers, F.[cowboy2]
In general, I think real estate agents tend to have a fairly short term focus. Demographers tend to have a long term focus. Both have a tendancy to fall into the modelling trap of using variables that can only result in rising or falling trends, not both. Thus, recent changes are projected into perpetuity. Only the magnitude changes.
On a side note, as a southerner, I was pleasantly surprised by Brisbane last time I visited. Clean, friendly, beautiful sunsets and nights. That’s all I’ve got to say about that.
Cheers, F.[cowboy2]
From Australian Property Monitors via Cracker
Sydney Edition 29 September 2005Week in Review
Grand finals and long weekends always have an impact on auction listings during this time of year – a time when listings normally fluctuate wildly.
What is also fluctuating wildly is the clearance rate on the Gold Coast, which hit its all time low since we have been monitoring the area of four per cent.On our records, and I am not just talking auctions, the South East Queensland market has been looking shaky for some time now. I have included in this newsletter (below) two pricing charts that cover houses and units in South East Queensland. The data behind these charts are based on valuer general sales and agent reported sales reported to APM.
In my opinion, the information presents a picture of a market that is now heading south for property prices; in particular unit prices.
I think another item worth noting is how highly correlated the three markets are with each other. Basically, housing price movements in the three regions have been running in tandem with each other since the series began.
The flip side to all this though is that it could be a good time to buy in the area given how depressed the market is.
Louis Christopher
Research DirectorSo there you have it. Prices are falling and will continue to fall, therefore it’s probably a good time to buy. LC’s opinion, not mine.
Regards, F.[cowboy2]
My opinion only.Yes, but one largely shared. Buying a standard house in Melbourne and expecting it to be worth more in a few years as a standard house is for mugs.
I must be totally out of touch. I had no idea prices had gone this high. Surely they are unsustainable at this level. Does anyone know what the average weekly wage is for person living in Australia?A touch over $1k Australia-wide, close to $1.2k in Melb, a bit over more in Sydney.
Another great indicator is – how many people would be able to afford to buy their own house at today’s price if they had no other housing-related equity? A simple calculation shows that at $50k, they could only afford one of those $200k dog-boxes and at $60k, around $315k… far less than the median house price. But that is average wage vs median house. The median wage is far lower.
If it looks like a bubble, smells like a bubble…
But there is no need for house prices to fall back significantly in nominal terms (although that is exactly what has been happening in Melbourne for nigh 2 years) if an analogous rise in the cost of living occurs while house prices remain constant.Cheers, F.[cowboy2]
From a purely contrarian perspective – possibly, but it may be better to wait until a price floor is well established and or the fundamentals (ie rent, wages) are in place to support the next boom.
on tonights news is “how you can benefit from the stock market boom… how long will it last and what stocks do the experts tip”!! makes a change from which suburb will boom next anyway.So now the “dumb money” starts to flow into shares… hmmm. Stop-losses in place? Check! Head in the sand? Check! Alright Maverick, press that red button labelled “BOOM” and we’ll see what happens.
milk goes up 8% on Monday. it is quite clear to me that we are experiencing cost push/demand pull inflation and there is only one way to go with that.And there’s not a gorram thing the RBA can do to fix it.
Bugger. Where’d I leave that hoe?
F.[cowboy2]
Yes, I said “distant”. But this is clearly ponzi-style, hype-based, irrational exuberance inspired speculation, bearing no resemblance to value based invesment. And that’s fine by me. There can be good money made this way, but I wouldn’t recommend using a buy&hold strategy on these blocks, or you may find you’re the last in the line of “greater fools”… (No offence to anyone, this is a recognised phrase when dealing in irrational markets.)
I can give similar examples from Victoria if you wish that may give some insight to where you’re headed (although the argument will be that we don’t have WA’s mineral resources so the Vic experience is irrelevant). Remember, the developers would probably be making money if they were selling the blocks for $70-80k. When they start reducing prices for the latest stage, the cascading effect is dramatic…
F.[cowboy2]
Wayne (the real estate rep) really looks after the campers. He gets flood lights – portable toilets and on the morning of the release there is a bbq breakfast.What, he encourages people to camp out? Astonishing. I must have tinitis this morning – either that or I can hear distant warning bells.
F.[cowboy2]And despite the risk of appearing concieted (or multi-personalities) by replying to my own reply to my original message… Richard Doughty, the great “Mogambo Guru” sums up the way I see the world rather well in his latest commentary albeit from a very US-centric and off-beat perspective:
If you have ever spent any time reading economics history, you will have noticed that 1) you cry a lot in frustration and anger of recurring governmental and central bank stupidity and the misery that comes from acting stupidly, and b) that there is NEVER an entry in the whole corpus of economics literature that reads “The success and healthy growth of the economy was made possible by massive long-term governmental deficit-spending to both a) wage war and b) invigorate domestic consumer demand, a philosophy known as ‘Guns and Butter’. And then the economy sailed smoothly to Utopian bliss, thanks to accelerated consumer spending financed by accumulating massive amounts of debt to new, high, record-setting levels. The economy was again set soaring to fabulous perfection, such that Zeus himself could but stare in wonderment at the glory, as businesses augmented this glorious economic wonder by also assuming massive, record-setting quantities of debt. The icing on the economic cake was when savings dropped to zero, leverage was at its greatest, and the savings, investments and the retirement of every citizen was tied, directly or indirectly, to an over-priced stock market, an over-priced bond market, and an over-priced housing market, with a huge government directly supporting at least a third of the total population, meaning every third man, woman and child in the whole freaking country. Only then, after all these economic pieces were in place, could the economy zoom to Irving Fisher’s ‘permanent plateau of prosperity’ “. And the reason that you will never, ever, read such a journal entry is because it is impossible to have a healthy, growing economy with these massive and massively stupid debt things. Instead, you get ruination and bankruptcy.Oh, but we’re alright here in Australia, we have government budget SURPLUSSES!!!
Just how useful a US$10 billion surplus is when you have a 8 Trillion Dollar tidal wave of US debt approaching (not to mention our very own AU$583.3 billion of personal debt) remains to be seen.Regards, F.[cowboy2]
Hmm, that sounded a bit smug, and did not add much to the thread, so I’ll try again.
I think the classic economic clock is broken. (In answer to Simon’s question on another topic, yes I actually do think ‘it’s different this time’. Different in terms of mechanism, but not the result.) The clock stopped when the long-held relationship between interest rates and inflation was severed (see RBA Governor Ian McFarlane’s speech from last night: Here)
Why did the world’s central banks push short-term interest rates to their lowest level for a century, and why has this apparently easy monetary policy not led to an appreciable pick-up in inflation?This will become most apparent when, at some point in the future, the Central Banks will discover that this severed relationship cuts both ways, and the old way of controlling inflation – hiking rates – is ineffective, in fact it will only aggravate the problem.*
So I don’t think the interest rate part of the clock holds great relevance at this point, but there is some merit to the rest of it – when you increase the money supply, it will drive up nominal asset values, and this will not happen in a coordinated manner. Rather, the money will flow from one asset to the next, causing a series of booms. The herd effect.Cheers, F.[cowboy2]
*Happy to explain my theory on this. Just ask (might be good for a laugh)…
Oh, and one more thing – I’m expecting a fairly major share pull-back in late Oct-Nov. I’d put a dollar on the XAO below 4200… This is not based on anything more than a gut feeling and a bit of very primitive chart-work, but it worked for the correction in Apr/May (though admittedly I didn’t realised we’d passed the bottom until the first week of June).
In my opinion there are always buy opportunities in the sharemarket, you just have to buy on value in sectors that are about to ‘take off’… [blink] Now where have I heard that before?
GDR +4.88%
OSH +1.66%
ROC +4.99%Oh, and that’s just today’s gains…
Maybe I’m just a lucky stock-picker?F.[cowboy2]
I have a comment…
<edited>
Sorry, that was a bit OTT… but I still reckon your predictions are so far off the mark they could be called crap.
Pasandbec, I like the way you think. With your strategy you will have a guaranteed outcome, whereas that suggested by Simon is based on a future prediction of the continuation of the mythological rule that magically forces houses to ‘double in price every 7 to 10 years’… which I have repeatedly shown to be bollocks anyway.
Your grandparents may have been onto something appropriate for their time, and I would suggest that the economic outlook today is somewhat closer to that of 1927 than 1997… Check this article by The Guardian explaining the devil in the detail of the IMF’s latest statements…
While I should point out that I’m no financial adviser, I personally believe that debt is going to become drastically more expensive over the next decade and our standards of living are going to deteriorate.
Cheers,
F.[cowboy2]…so assuming 52k net per annum, 2k per fortnight. Fixing 247k at 6.7%, $1,300 per fortnight repayments would see the house paid off in ten years. It is absolutely possible for a couple to live on $700 per fortnight for food, bills, petrol and clothes (I live quite comfortably on precisely half that – the remainder of my salary is invested), but whether or not you wish to is up to you.
Cheers, F.[cowboy2]Nope, but if you can get a mate or two, a slab of beer, a telephone (to order building supplies), a drill, circular saw & spanner and a copy of Scott Cam’s book[jealous]… you’ll have a laugh, save a fortune and get a fantastic sense of achievement…
Cheers, F.[cowboy2]I don’t know enough about the suject to comment on most of your points Celivia, but I saw a short piece on TV the other night (might have been Alan Kohler @ ABC?) where it was pointed out that mandating the blending of Australian produced ethanol would add to the price of fuel…
[hmm]
F.[cowboy2]
Oops, sorry, that really wasn’t directed at you, I was just ranting again…
When I said you need to dig a little further, I meant that not only has real estate speculation pushed house prices higher than they deserve to be, the associated borrowing/money creation is directly linked to higher petrol costs.The gold comment was directed at, well, anyone really.
Back on topic – the price of crude oil was down about a US$ overnight. The financial press related this to the downgrading of hurricane Rita to Grade 4. I think it was more to do with a strengthening US$ following yet another interest rate rise and comments suggesting there were more to come. Oil in Aussie dollars is roughly steady, maybe down a fraction, but certainly nothing for motorists to get excited about.
Cheers, F.[cowboy2]
One more thing – wasn’t today the latest official buy no petrol (aka ‘stick it up your ____’) day. How’d that all go then? I bought some, and yes, it was down to 132.9c from 137.9c early last week. Ripper.
F.[cowboy2]
…and perhaps you need dig a little further Wayne… a large part of the oil price rise story is inflation (oh yes, I’m on my favorite soapbox again!). The total money supply here in Australia has doubled in less than 10 years, mostly created by debt and most of that debt has been incurred in the pursuit of real-estate riches… If you double the supply of money without doubling domestic production, you are in effect halving the value of all previously existing money. Voila, in time, other prices will rise in kind. Australia, the United States, Britain etc have all been massively inflating, and this is coming home to roost. Of course, most economists will point to increased demand for oil from China and India as catalysts to the recent demand/price increases, but these countries are only growing because/b] we ‘westerners’ have so much funny money to buy their product with.
It’s all the same story:
^ house prices
^ base metals
^ precious metals
^ stock markets
^ energy costsAnd why? Because:
^ debt
^ money supplyResulting in:
^ inflation.So who wants a really hot tip on a great time to fix interest rates on their debt? I’m no financial advisor, so I can’t really say. You do the maths.
And for what it’s worth, I don’t feel any great guilt for my contribution to rising petrol prices (yes I have and will continue to profit from shares in oil producers & explorers). I didn’t cause this inflation after all!
One more thought – what is more financially challenging to a young couple/single/family looking to settle down today compared to 5 years ago – an extra $30 per week for fuel or the extra $200 per week they’ll need to find to afford a modest habitation?
Why are high house prices good (fullstop), yet high oil prices bad (fullstop). I can see plenty of good coming from high petrol prices, such as the removal of unnecessary gas-guzzling 4wds from suburban streets, a reversal of the freeway slowdown of the last few years, better environmental outcomes, more funding for oil-energy substitutes… I could go on and on. There’s also the lovely profit element…Goodnight, F.[cowboy2]
PS – Who was laughing at me so recently for being a practising gold-bug? Gold being the ultimate inflation-beater of course, and now up nearly 20% for the year….
Originally posted by ubique:Does anyone have any suggestions on how to move this property?
Errm… lower your asking price?
There are buyers out there, they’re just waiting for your price expectations to match their own. Don’t make the mistake of chasing a falling market down, always pricing your property at yesterday’s fair value…
Unless you don’t need to sell. If this property was a sound financial investment when you purchased it, what has changed?Cheers, F.[cowboy2]
Heehaw… best post this week.
F.[cowboy2]As a net energy exporter I should think we’d be worse off / more inclined to recession should energy prices fall significantly. Yes, we’re a net importer of oil (~20%?), but when gas & coal are considered we actually profit from higher prices, and all forms of energy tend to move together in price…
Originally posted by leoau:So, no extermal changes, no need for planning permit. No removing of load bearing walls – no building permit.
…still depends on the location and total cost of the reno… under $5k you should be fine though.
F.[cowboy2]
