There is a great deal of uncertainity in the market, wether you believe it or not.
Yesterday I read a great article (financial review page 12) of one couples woes from the Henry Kaye days. (the need for greed)
I have been through interest rates of up to 19.33%, actually the statement is hanging on my wall over my desk to remind me of those days. So i am not too concerned with paying 7-8-9-10% today for money and opportunities to prosper.
Experience tells me that there are some bargins coming, so what do you think???? … “some ones bad luck is some one elses good luck”
As Kerry Packer said once “every body needs an Alan Bond in their life” (chanel nine buy back)
Philip
arbitragers play an important role in any market. if you believe you can grab something below market value then go for it… you just need to be sure you do indeed have a better use for the asset than the person that is selling it! I would have a guess that a lot of the ex-Henry Kaye stock was probably never worth what it was sold for – so to buy it ‘cheap’ is probably not so cheap. Anyone out there got some comments on that?
http://www.megainvestments.com.au
Extensive list of ‘Off The Plan’ property available for sale in Perth.
John – 0419 198 856
Prices may be coming down or flattening in your cities, but here in Adelaide the market still seems strong. Clearance rates at auctions are dropping, but people still seem to be prepared to pay huge sums for properties with rental yields of 3-4%.
So as far as I can determine, this first .25% rate rise hasn’t made a jot of difference to buyer confidence here. Sure, prices have gone off the boil since the crazy months of 2003, but they’re still high and attendances at opens are strong.
Anyone else have any views on Adelaide’s market?
Phil,
I think what Kerry Packer said was “You only get an Alan Bond come along once in your life” – referring to the buyback of his beloved Channel Nine Sydney and Melbourne for around 300MM after flogging it off to Bondy for 1050MM a few years earlier.
As for props coming off the boil, Perth, like Adelaide as Carlin refers to, is not experiencing the falls that the eastern states have seen. having said that, both Perth and Adelaide didn’t enjoy the highs seen in Sydney / Melb / Bris so it’s only fair I reckon.
All up after the correction I think the eastern seaboard is still in front compared to WA & SA – so no whingeing from you guys OK ??
Cheers,
Dazzling
“Go hard or go home”
Originally posted by resiwealth:Experience tells me that there are some bargins coming, so what do you think???? … “some ones bad luck is some one elses good luck”
I agree Resiwealth.
It is important to remember that any bargains arising from a falling market will only be available to those with equity remaining. The banks will not rely on yesterday’s valuations when deciding whether to offer further debt to investors, and anyone with negative (or even nil) equity can kiss the deals goodbye! This is why I have been advocating lowering LVRs on property portfolios for some time.
Of course the hardest hit will be the MEW (for 4WD/Holiday/Renovation) suckers who will find themselves not only unable to purchase bargain properties, but also unable to move PPORs or even upgrade to a new car.
Cheers, F.[cowboy2]I would have a guess that a lot of the ex-Henry Kaye stock was probably never worth what it was sold for – so to buy it ‘cheap’ is probably not so cheapIf you bought it today, then by definition, that is the market value – fair value and therefore not cheap.
I have been through interest rates of up to 19.33%, actually the statement is hanging on my wall over my desk to remind me of those days. So i am not too concerned with paying 7-8-9-10% today for money and opportunities to prosperI suspect that if we are paying interest rates of 10% today, IMO we would in the middle of a recession.
A few points from my studies over the last 15 years is that profits are made over time and not over night.
After a market has settled we can see that the properties will establish a more stable value. It is difficult to guess the true value on a rising market.
Experience of making money in real estate is added by the fact that some properties will perform better than others over a 10 year period.
In 1994 a friend of mine purchased a waterfront in Hunters Hill for $860k, in 2004 it was valued at $4.3m and still rising. The increase was with out any improvements made to the property.
My point is as I have said before, better quality properties will perform to a greater extent over time. What ever your strategy and opinion is about property investment will be determined by your bank balance.
Now (or the next 6 months) is the time to pick the winners for the next cycle IMHO.
Philip
I think resiwealth’s point was not to buy ex Henry Kay stock, but to take advantage of the opportunities that may arise in the market.
Let’s be clear….we don’t want to take advantage of people, but certain opportunities that arise.
At least twice a week I have investors ring me asking whether they should sell. Invariably they have overextended themselves and now have negative gearing and can’t see their properties go up as promised by whoever sold it to the (not us!)They are questioning their investment decisions.
If our agency (www.rentingmelbourne.com.au)was a normal agency we would advise them to sell because that’s how estate agents make their money…. selling property.
We suggest that real estate is a long term investment and not to sell to the bargain hunters.
Anyway….
What this means is that a lot of mum and dad investors (who buy and sell on emotion and gut feel rather than based on research and considered opinion)are putting their properties on the market.
Some are great buys and worth purchasing (which we are doing for our clients (www.buyingmelbourne.com.au)
But remember that the banks and valuers are very conservative at present and they also recognise that the “market value” of many properties has fallen.
So while it is a good time to buy the right property, it is even more important than ever to do your market research, and get the price right. Go in their and make some cheeky offers and if you don’t get the property at the right price, move on.
Otherwise you could be embarrassed by the valuation you receive and the bargain you thought you bought may not be a bargain at all.
Michael Yardney
METROPOLE PROPERTIES
Author of Australia’s leading property e-magazine.
Join over 10,000 readers each month.
FREE subscription http://www.metropole.com.auSpot on Mike … Phil
You must be logged in to reply to this topic. If you don't have an account, you can register here.
