hey everybody
im readng a book called real estate real money and it said that the method of buying a ip and paying it off, buying another paying it off and so on is great but you will only end up with about 4 properties by the end of your working life! is this true? becuse i was planning on doing this i need your response!
cheers
Originally posted by The Mortgage Adviser:Basically, YES. There are about a million variables though. Your income is one. Property prices are another.
GEARING IS THE FUTURE!!!!
Providing there are capital gains in the medium term future. Some economists are still worried about deflation and depression.
It must be noted that the majority of economists dismiss this as a possibility…but so did most economists prior to October 1929.
For a chart of real house prices for the period click on the link:
http://tradingforaliving.netfirms.com/real_house_prices.htm(Note: Scroll down for other interesting charts)
Note that it took about 30 years for real house prices to recover from their heights of the late 20’s
Cheers
er… yes. But scroll down, I have included the whole chart up to the present. (I did add some charts so you may need to refresh)
>>Don’t you think the occurrences in 1929 could never happen again in this day and age?<<
I don’t know if it will. But I can’t see any reason why not, given the right circumstances. I think there is plenty of potential for the poo to hit the propeller as things stand in the world at present.
The good management of Australias economy mightn’t save us if the US and/or EU tank.
We will be sucked down in the vortex.
Yes, shares and futures can be played either way, but property a whole ‘nuther thing.
When you buy property with gearing you are taking a punt on the upside…a pretty safe bet for the last sixty odd years.
At the moment I am nervous about long side, non-liquid investments, thats all…unless they represent really excellent value. I am personally going to wait for better value in the property market, and I think its worth prompting others to at least examine the risks.
Originally posted by The Mortgage Adviser:There are options in a downward market. Fix the rates if you are concerned about increasing rates. Lock in your returns.
BUT how do you protect against sliding property values aka Japan, and some Euro countries.
Know Japan has neutral population, but our boom has way more to do with poor short sighted economic policy (FHOG to cover their a##e after GST slumped the blg induustry) and common household greed than our pop growth.
Our economic management is based on home equity drawdown, not real growth, we can’t all go on buliding and selling to each other forever, we must eventually be able to sell to the world.
Hope China keeps buying coloured dirt, AND they keep their economic problems to themselves.
Too much here to discuss on this sight but our debt to income levels are at levels where something must correct.
The wealth effect (everyone feels wealthy with paper waelth but spends real cash according to how they feel ) has a counter the negative wealth effect and this was a major factor in japan (plus social diffs ) where people stop spending and the economy stalls, aka the US when the share market bubble burst.
Too much here for now.
Terry
” poor short sighted economic policy (FHOG to cover their a##e after GST slumped the blg induustry)”
Huh? what’s short sighted about replacing a complex wholesale sales tax that no one understood with a simple one rate transparent GST? (which also rebalanced the previous skew from consumption of goods to that of services which was very unfair). It would hav been fairer and easier if the minorities hadn’t forced a bunch of annoying and hard to administer exemptions through. The FHOG was just a bonus for home buyers and a real boost to the building industry – a transitional financial assistance.
the real soft option is in not abolishing: negative gearing (replace with quarrantined losses), stamp duty, CGT 50% reduction. Clear out all this rubbish and re-create a balanced market place.
coloured dirt – it doesn’t matter what it is as long as we sell something. but with our pathetic population levels it is hard to build an industry that is much more advanced. all we can do is keep ploughing big bucks into education and hope that the future generations prefer the beach to the money on offer in London and NY so that they’ll stay and hopefully create some wealth generating industry. Until then breaks on property taxes will continue to support building as a major industry and it will continue to be the case that the brick layer earns more than the architect who designed the building. It just depends how we can hold an equilibrium between supply of houses and people to live in them. The down sizing of the average household is clearly another lucky card for the real estate market and hence economy as a whole. When the boomers start dying in 20 years or so things could get inetersting – who will want to buy all their shares and property?
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
this makes sensible reading….
http://www.ipa.org.au/Media/mnhs271203.html
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
I just posted this link for another thread in General Property but I think it is very relevant here as well…
http://smh.com.au/articles/2004/06/27/1088274624058.html?from=storylhs&oneclick=true
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
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