bardon wrote:
I used to think this way but what I have found is that when it comes to property, time in the market is far more rewarding than timing the market. In 25 years time the theoretical 5% that you may think that you have saved ( and it is a theoretical number and doesn't include the rent you are paying whilst you find this market…[Read more]

bardon wrote:
Those with the I See Bubbles sense always seem to be a very outspoken and convicted lot, they can see things that others cant and wont rets until they have changed everyone else over to their dark side. How much will house prices have increased in 25 years is the question, how much will rent have increased in the same time frame…[Read more]

Oh, as for Melbourne's double dip – yes it is always possible that prices will stabilize and slowly correct rather than crash.That said, when unsustainable financial growth dips twice, in just about every other commododity or stock that I know of, a crash follows. Australia may be different but it is the least likely outcome.Diamonds are…[Read more]

ALF1 wrote:
Thanks CYC! Way too much pessimism going on in this post. Remember the Y2K bug – the end of the financial world as we knew it. The reality – just a bunch of people who will take any opportunity to stand on a box and preach their doom & gloom.

Y2K was as more about the IT industry cashing in on fear than it was about gloomers. A lot…[Read more]

mattnz wrote:
It is no coincidence that the two massive peaks in Australian private debt to GDP levels coincide with the depressions of the 1890s and 1930s.

Exaclty – people need to look further back into history to see what is going on ATM.

Dan42 wrote:
BTW, some of the bearish types here have been predicting the 'bursting of the bubble' for the last three years. What's so different now compared to last year, or the year before?

Sentiment.The last time any bears worth their salt were really behind the crash being on was 2008. Rudd turned that around with the FHB boost, allowing…[Read more]

ALF1 wrote:
LOL!!!! Oh come on guys! Now it's going to be that battle of who gets in the last knife, I mean word. It has been great reading but you guys could end up writing another book like Dianetics and then what has the world got? 2 more loopy religions that can't agree on anything. But it has been a hoot!

You started it with your shortage…

I agree with ALF1 here – it is going to end up in a debate of semantics.if you tell me I suck, I ask what? What do I suck? You suck is incomplete:)Obviously we have a totally different take on what a shortage is.I would argue there is not a shortage of seats on your bus, just an excess of unreasonable people, But a big problem with people is that…[Read more]

fWord wrote:
Definition of 'profit taking' from Investopedia:"The action of selling stock to cash in on a sharp rise. This action pushes prices down temporarily. When traders are profit taking, the implication is that there is an upward trend in the security."The word 'demand' does not appear even once in all the posts above, let alone my own r…[Read more]

devo and fword,your arguments are valid when taking into account demand that is not based on physical availabilty and I do not dispute them in that sense – especially fwords description of 'profit taking' demand, which is essentially what I term credit fueled demand.In this case, the use of the word shortfall is invalid. A shortfall is a physical…[Read more]

ALF1 wrote:
Australia currently has a housing shortfall

Surely increasing stock levels in every state disprove this. If there truly is a shortfall, how can stock increase without a similar increase in homelessness?

There are cycles within cycles. Last up cycle was bigger than any up cycle in quite a while and got a boost when it started to wind down in 2008.Anyone who brought in before 2004 is sweet.

fword,I never said Singapore had high wages? Quite the opposite. I said Monacco did and Singapore was unlike that.An effective land shortage can always be made ineffective, a true land shortage can not. Besides, there isn't even an undersupply of housing in Australia – let alone land. There has just been an oversupply of credit fueled demmand.Look…[Read more]

fWord wrote:
Question, if I may: Who set this as the 'globally accepted standard'?

History and maths, as I understand it. Long term averages and the like.

fWord wrote:
If this is the case, then property in Singapore is at least one other basket case I know of where such a standard doesn't hold true. My suspicion is that this is the case in…[Read more]

Intrigue,exact numbers are quite hard to find but housing bulls and bears generally agree there is a 3 way split in how the whole of the Australian population is housed – has been for a while. 30 odd percent rent, 30 odd percent have a mortgage and 30 odd percent live in a house that has been paid for.Now, FHB numbers are right down. In 2009…[Read more]

fWord wrote:
Again, goes back to the question of, 'Why should such property sell for under $300K?'

Because around 4x income is the local historical standard and the globally accepted standard. I have no other impartial standard to go on. New Australian standards are set by vested interests and therefore not impartial.

fWord wrote:
Well, it…[Read more]

Your dog chasing it's tail analogy is interesting and reasonable fword – both sides of the affordable housing debate end up doing this, as you say. Trouble is, looking away from our own tails, we still see them in the big picture.I'd say – Australia stands alone in the world as not having a housing correction.You'd say – Australia is…[Read more]

Our debate is circular fword – but you are a good sport about it:)The government isn't solely to blame. There are so many little bits and pieces that have led to house prices here and elsewhere becoming overvalued.Other than land release, CGT removal and government stimulus, the main drivers of house prices were easy credit and historically low…[Read more]

Like you said, it's only around 25% of people that rent and of those I'd wager the majority are lower wage earners. Renters who can afford to buy, like myself, are few and far between. Current rents are high for low wage earners. Those who have money to spend ATM are becoming a minority.Older home owners who have little to no mortgage could afford…[Read more]

ok fword, you tell me what else is expensive?I honestly can't think of much. Electronics are dirt cheap ATM. Cars are about what they have always been relative to income. Food and petrol may be rising but only returning to 2008 prices.Granted, cigis, booze (tax) and insurance are costly but all of those things are very much a choice.Relative to…[Read more]