To the wise & knowledgeable,
Popular opinion suggests that the next 1-3 years will see a correction of property prices in Australia. If you recall, what heightened the recent boom was investors cashing out of a cooling stockmarket and plowing it into property in waves, from residential, then commercial, industrial and retail.
So, today we have the All Ords in record highs and people are probably doing pretty well for themselves…so IF the stockmarket again experiences a bear market, where will the flow of money go this time?
If it’s property, a lot of people would’ve guessed wrong. If it’s not property or cash holdings, what else is there?
Scarecrow7
“In times of crisis, both danger and opportunity are present”Right now the ‘big’ (institutional, etc) money is in minerals and other primary products (oil), consifering Austrlia major exports are mineral we are riding on the back of that to a degree.
Also with a decline in property prices many people are placing money back into super also.
I do think there will be another bull run in the sharemarket after the cycle turns aginst minerals.
Rgds.
Lucifer_auI think if commodity prices remain around this level (China still buying) stockmarket still have few years moderate growth. If commodity prices fall it will increase our inflation. We import so much and prices of imported goods remain low becuase of high Aussie dollar. On the other hand low Aussie dollar will also increase export. But if Aussie dollar goes down, inflation goes up, so does interest rate. So many forces outside our control are keeping the balance.
Anyway, I am planning to get some IPs in the future. Keep most of my money in sharemarket in the last 7 years. Offcourse would have done it differently, like put all my money in IPs and not sharemarket if I knew.
The problem is currently I can’t see good value properties in Perth. I live in Perth so I like to start here. Maybe because I know nothing about property.I feel that property took off after people got spooked by the tech wreck. Also property had been flat throughout most of the 90’s, so it’s time had to come sooner or later.
Also I think home equity loans are largely responsible for the sharemarket surge and the high number of new cars on the road.
It all goes in cycles and property has had it’s run, I’m just looking forward to my expected 25-33% downward correction from the peak of the boom in property prices.
That’s my opinion and I’m sticking with it, so there![tongue]a further 33% downward correction? presumably you are talking about NSW and on top of the already corrected prices that people have spoken of on here? gees that would be a blood bath over there! imagine bank stocks in the face of NSW real estate valuations halving… or any stock for that matter. If this eventuated no one would be immune – except for the old school folk with notes shoved under their mattress
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
My feeling is the property prices in NSW can go down another 10% and will be flat for considerable length of time. WA too I think will have small correction. Personally I think the novelty of owning holiday homes or IP outside city that is not easily rented at reasonable price and costing money will wear off. Almost like sharemarket at the peak, anything you buy would go up. But when the market is no longer hot only the blue chips that generates steady income servive. I feel some properties outside Perth is getting overprice. I quess the rules are still the same location, location, location.
I can’t convince myself to get into IP now. I know it’s the time in the market rather than timing. But prices are way out of synch with wages. Even in Perth that has not gone up like NSW I am a bit nervous. People say it’s okay because we have mining boom, but you know what happened with previous mining booms.
PS: I’ve been known to be wrong, many times.some interesting reading here for you Zen on the state of the WA market:
http://www.reiwa.com.au/content-features-detail.cfm?PressReleaseID=205Not sure why you are predicting a 10% drop – cheapest median price in Australia (that includes Adelaide and Hobart!), booming economy, strong population growth. Have you taken a drive down Mandurah way lately? Mandurah is the nation’s fastest growing district. I think we are set for a nice healthy year in WA.
http://www.megainvestments.com.auExtensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
Ausprop, you didn’t read my post correctly.
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