Forum Replies Created
- RickH wrote:You refer to the 80's…..home loans at 19% and term deposit interest in the mid teens . That is unsustainable. This time interest rates have been kept in check(and appear to have peaked), Australia's economy is in better shape than nearly all developed countries …so nothing like the 80's.
Agree with some of what you some and think some is scare mungering rubbish.
homes were more affordable when rates were at 18%…
IMC Newbury wrote:white_goodman wrote:how much are the fees then?Hope your answer is forthcoming. Mine was: $3300 + $740 + 2.5points of the loan so = $5000 + and then 9.75%. I will keep my thoughts to myself and let everyone make their own judgement. This should be a forum of honest exchange of information.
and how much were you actually borrowing?
how much are the fees then?
Loans USA wrote:Troy: I agree, financing in the US is completley different to Australia. Just to bring you up to date, Loans USA do not only limit loans to purchasers of their own property. Leo: An LTV of up to 75% is highly achievable in the US. In states and suburbs where properties are in the lower price bracket LTV achievements of up to 70% is most favorable. This assists you in leverage, allowing more purchases. Cash out is also a possibility. This is a great advantage if you have purchased in cash and would like to leverage to your next property. Blanket loans can also be achieved.say i find a property thats 50k, i have 30%, therefore loans is 25k, how much in fees would i be expected pay to loansUSA and the actual finance company in the US (not buying through MYUSA)?
cheers
what bank lends here for foreign prop? or personal loan?
where did you borrow for your first?
just a note just because Moody's forecast something doesnt make it gospel. They are good at reporting things that have happened, generally pretty useless on forecasting as is most people. Lets remember Moodys, Fitch and S&P all had Lehmans and Bear as AAA rated or whatever the highest was before they went under..
<edit> I think Vegas and Florida present great opportunity and will give you maby 3 years to start getting a portfolio together in these areas. Im sure his sister will be quite fine.
here here rick, its be nice if the forum was cleaned up a bit
part 2?
bump.
Im also interested in this info..
toe wrote:nicolas I agree with the points you have raise and in your quotes. I think that the average investor is in a pickle, and that as a result prices might stagnate for some time. After the boom in the early naughties people were also calling for a crash but instead prices went sideways for three years. The reason they don't crash in this cash is the reverse of why the US did crash, in the US the crash wasn't just about expensive housing, it was because everyone had to sell at once. Mortgage resets had doubled their payments and the resets all occured within a few months of each other (people had planned to refi but banks had tightened their lending practices). That won't happen in our case, if investors offload it'll be over a wider timeframe, just like the early naughties.So I am maintaining my position that if there's a crash it will be due to wider economic conditions. A China bust maybe, or the world loses confidence the world currency (US dollar), given the amount of money they've "printed" recently.
look at the source of funds for our major banks in financing residential property, our banks arent as immune as you think, when the banks costs go up (interest they pay from getting foreign money), and they are, interest rates will go up independent of the RBA cash rate, and I imagine there are large chunks of the community (FHB's, gen X and Y's) who are very susceptible to interest rate rises, negative equity on PPOR, and downturns in general economic activity (unemployment etc). I dont see it as orderly as you think, nor as crisis mode as other people think…
2 cents etc
toe wrote:white_goodman wrote:your first sentence makes zero sense.I can only assume you've misunderstood my point, because it makes perfect sense.
Quote:From SMH
About a quarter of Australians rent their homes through the private rental market — and nearly half of these (45%) are helped to make the rent through subsidies from Commonwealth Rent Assistance (CRA) program.
Most of these people are never going to buy homes, so how does it make sense to consider their earnings in affordability calculations?It's important to use the correct statistics also. This thread is clearly about risk to housing and economy, largely due to the broad risk of defaults. While inaffordability may coincide with risk of default, there are circumstances where it may not may not. Just because people cannot afford to buy, does not mean that those who are currently owners cannot afford to hold.
Thats why banks do not use affordability to assess your risk of default, they use your Debt Service Ratio.
yes but where does the demand come from if people cannot afford to buy? Cos supply will increase (new developments etc), unless you plan on closing a vast majority of the economy down. I cant imagine all the baby boomers having a nice cash flow nest egg after retirement many will downsize to get their hands on some equity.
Say you earn double the median wage (you are probably a home buyer) and the affordability ratio is still high, you are still paying a higher proportion of your wages in debt servicing etc. You arent really making sense, its a measure of affordability as a whole, not who can and cannot buy homes specifically. If less and less people can afford homes (not saying everyone should, thats retarded) then the pool of people to buy and sell greatly reduces, thus demand will have to come down naturally.
If you have done any economics at school/uni, draw the chart showing inelastic supply (near vertical and what we have in Sydney, Melb etc) and draw demand crossing it. Now show what happens to the price equilibrium when you reduce demand.
toe wrote:The trouble with using Median Price to Averge Wage as an indicator is that a large percentage of the average wage earners do not buy housing.Money supply is pretty interesting though. The U.S. is far worse in this regard. In order to pay out bad mortgage debts, they have trippled the money supply since 2008. It took 200 years to get to US $1Trillion in circulation, in two years they added $2 Trillion more!
your first sentence makes zero sense. Its an indicator on affordability not % of average wage owners buying property.
Money supply is an issue considering to sustain current levels of growth we need to issue more and more debt, usually more than GDP growth…
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with housing at record unaffordable levels, baby boomers drifting off into retirement, and banks needing to create more and more debt to keep the status quo, where is the demand gonna come from to keep prices escalating upwards?
is this sustainable or plausible? I think not
the party may continue for a while, but when China starts correcting and the baby boomers start retiring on mass, it will be an interesting time.
speedy gonzales wrote:Charles 1 wrote:Interesting article in Property Update yesterday on investing in the USA. http://propertyupdate.com.au/articles/is-the-investment-grass-really-greener-in-the-us.html Read it and take out of it what you will. There are always different opinions on how and where to investInteresting that this sounds like a recent article from Neil Jenman. Both even made the exact same mistake of saying that if Americans can borrow at rates of 0.50% why aren't they buying the properties. This sort of statement is crap. 1. Banks simply aren't lending regardless of how great your credit score is. They can make better returns on the markets and have no incentive to lend 2. Americans cannot borrow at rates of 0.50%. Anybody can research that and see thats a load of bull Statements like this reak of someone who has their own agenda and have no credibility
yeah source and reliability…
what business does the article writer run
well if i want to invest in property I cant rationally do it in Australia atm, to be honest good quality property in the US 80-120k mark seems a lot smarter for me
Hey Cheeves, do you sell property only in Lehigh and Cape? or do you include ft myers, Tampa etc?
RickH wrote:i am at the end of my patients…. last chance.
After 5 mths and rubbish requirements from financier I am almost done with it.
No fault of my usa property or loans usa but had enough.
3 properties in KS were spot on for what we wanted and 70%LVR (looks like being
50% at best now) and after 5 mths no concrete answer on the finance.
MYUSA have looked at alternitive areas where they can secure finance easily but the
numbers dont stack up for what we want.
One last property being priced up at present. See how it goes.
On the positive side it has given me time to do a lot of my own research on KS. I am comfortable
buying in KS and the returns are good.See what happens
has loans USA and my usa still taken their pound of flesh regardless?
USA wrote:I have just been reading through your comments, interesting find for the lending. I have also seen in previous threads your comments about the high cost of Loans USA. Their fees seem minimal compared to the costings your quoting. Why wouldnt you have a company in Australia do all the running around for you and find the best deal out there also?Not all of their lenders require PITI, most of them have fixed lending charges with no exit fees.
Maybe they could be a good place to check your findings with?
this is true, im struggling to find something without the ridiculous fees… the main difference from that one I found this morning is the rates and terms… in the My USA thread someone said like 7.5% fixed over 5 years…. with this lender u can get typical 15 and 30 year loans for 4-6%… still i havent used them so this could all be fluff from their end..
