- kong71286 wrote:I agree that Today Tonight can be biased at times, but thought I'd share the link anyway as it relates to this topic and a lot of the discussions that have taken place in this thread
- Issue of affordability and how some buyers have been speculating only to end up with negative equity
- Impact Carbon tax and any interest hikes could have on the Australian Property Market
- Suburbs that are likely to see significant growth E.g. Gladstone, Orange, Ballarat
I'd encourage you to view the link, rather than completely dismiss it
If I thought you had some way of giving me those 5 minutes back, I would ask you for them. That said, this has provided me with a fantastic opportunity to prove my previous point. Sorry, just not interested in the negative nonsense. More interested in creative ways for all of us to be wealthy.
I watched it, it was sensationalist and there was not a single new piece of information in there that most of us haven't heard, read or seen before.
These cases in point from the video demonstrate how superficial and sensationalist it was;
– Buying units off the plan in high-rises on the Gold Coast. –> Just about the silliest thing any investor can do with their money. Let alone folks using all their life savings. they should have done their due diligence and not taken on so much speculative risk.
– Stated that the situation was equivalent to the U.S. sub-prime collapse. –> Nonsense. This shows a complete lack of understanding of the basic events that lead to the GFC.
– Remember, it isn't a loss until you sell. IF you bought of the plan and were going to "flip" for a profit –> You speculated and lost.
– "Stagnation in these difficult areas" –> Well, DUH.
– Average discount of 6.4%. Sorry, that doesn't alarm me. I haven't purchased a single property that wasn't at a greater discount than that.Alot of vendors can't come to terms with the fact that they didn't get 3 years worth of growth since 07-08. (Frankly, I just hear "bargains" and "higher yields".)
– "Buyers strike" –> I applaud his will to exercise his democratic rights, but I think it is misguided. A more effective and positive campaign would be, "Speculators Anonymous: Learning to buy and invest in property responsibly".
– All the pictures of property were the "high-end" of town. Everyone knows there is losses to be had in that particularly volatile part of the market.
– Pictures of thunderstorms and music for dramatic effect. –> Cheap. I would be surprised if they didn't throw in a few subliminal message frames of homeless children and monsters eating them on the streets.Note: The hotspots mentioined are all well known. Do a google search for Terry Ryder and have a peruse of last months API/YPI magazines. Orange has been touted for a long time. Gladstone is old news.
For once, I would like to see one of these stories done on a "boring investor" that plods along achieving their goals. That won't happen. Read anything from Jan Somers or Margaret Lomas and you will feel much more positive about investing over the long-term and walk away with real skills that will get you there. That is exactly what I am doing, walking the talk. Step by careful, steady step.
Apologies for the inconvenience emptyvessel.
A lot of the information was new to me, and being a new investor I am quite emotional I just had the urge of sharing the video and warning others as soon as I saw it. I know a lot of friends and family have rushed to buy properties under the belief that property prices always go up, without taking into account affordability issues and financing issues, and some may have over paid for some of these properties.
Obviously sophisticated investors like yourself already know all of this, and invest based on numbers rather than speculation. You have made it clear that you do not appreciate negative nonsense, so I will refrain from sharing these type of videos in the future.
Just out of curiosity, where are you investing your money right now? And what are your thoughts about investing in US properties, and investing in Gold and Silver?
the driving force for housing price is supply and demand
gelster wrote:the driving force for housing price is supply and demandI am no economist, but isn't that the same for any market?
kong71286 wrote:Apologies for the inconvenience emptyvessel.A lot of the information was new to me, and being a new investor I am quite emotional I just had the urge of sharing the video and warning others as soon as I saw it. I know a lot of friends and family have rushed to buy properties under the belief that property prices always go up, without taking into account affordability issues and financing issues, and some may have over paid for some of these properties.
Obviously sophisticated investors like yourself already know all of this, and invest based on numbers rather than speculation. You have made it clear that you do not appreciate negative nonsense, so I will refrain from sharing these type of videos in the future.
Just out of curiosity, where are you investing your money right now? And what are your thoughts about investing in US properties, and investing in Gold and Silver?
Sorry mate, I was harsh. A bit rude, really. No real excuse for it, just a reason –> The negative stuff obviously get's me fired up. You have every right to every opinion you want. Just remind me of that next time I am a bit harsh.
I'm not that sophisticated, I just "water the seedling (tree, forest) every day". Many others here much more experienced than I. I just have a path and method I am following and it seems to be working well. What did Einstein say? Simple but not simpler. Something like that. He also said something about compounding being the most powerful force in the universe. This is core to my entire strategy. And much of the basis of society and modern economics, depending on how you see the world.
Gold and Silver intrigue me but I can't help that feel that when everyone is talking about buying them, it means they are over-hyped. I am a counter-cyclical investor by nature. So all the talk of Gold and Silver makes my spidey-sense twinge like mad. I see the logic behind why they are safe-havens and why folks are attracted to them when talk of the world's reserve currency collapsing and may be replaced. The problem is, I think the whole currency and debt default thing is so complex that I don't know what to believe. I can't see a global gold standard happen, there just isn't enough gold being mined, ever. The results of this would be catastrophic and largely unpredictable in our modern, complex economy.
US Property –> I reckon in the long-term these are a ridiculously good prospect. Problem is, I don't know enough to eliminate the risks associated with investing in something I don't understand very well. What I mean is, the fundamentals make sense, but the details are beyond me right now. If I had time and the right contacts, I would go nuts in the U.S. buying good property.
What really interests me in emerging investment areas? Alternative energy, medical science, biotech and molecular nanotechnology. The last one has the power to change all the others and our world in ways that have interested me for at least 15 years. When I "retire", that's what I will invest most of my spare time in, when I am not with family.
The apocalypse is not coming. Countries have defaulted on debt many times (just not the US). Stick markets recover. Mining goes out of favor. People keep reproducing and they all need a roof over their heads.
This is going to be Fragmented but I don't care to write a proper formatted novel tonight.
Don't listen to the baby boomer generation know it all's that have only seen rising house prices there entire life and think that "This is just the way it is"
"the driving force for housing price is supply and demand" is <moderator: delete language>. Accelerating debt and speculation is the driving force in rising house prices
Australia has the most expensive property in the world, At around 7x Average wages, The world average being closer to 3
I don't care what anyone tells you, Financing for a 500k house with a 4% GROSS rental yield is a LIABILITY, not an ASSET
You could have bought silver on the 3/1/2001 for $4.47 an ounce and sold on the 25/4/2011 for $49.78 which is a 1013.64% increase in 10 years or a 101.36% gain per year, But silver is a bad investment, You would have been much better off negatively gearing a -$200 a week cash flow property to invest for the long term because property ALWAYS goes up.
All capital cities are experiencing price reductions with Perth and Brisbane falling by around 7% and 6%. Wait and watch for much bigger falls in the near to mid term future before you go considering chaining yourself to a debt ball.
Any don't listen to the people trying to tell you what great property deals are out in Central Queensland, I live in emerald and I can tell you that paying astronomically high property prices for a fallen down wooden hut built in 1932 at a place like Dysart which rents out for 20 million dollars a week to a mining company at the height of a mining boom that cannot last forever is not that smart.
Watch for the day that those rentals are empty and the houses themselves cant even be given away, Though the 800k debt that bought the hut still remains.
Though don't try and argue with the Australian property zealots as property investing has become more of a religion then seeing the numbers through a educated, logical and mathematical worldview.
Remember above all though: Australia is DIFFERENT.
emptyvessel wrote:Ok, I am listening. Can you give me a few examples of how the money an investor in property now can access those investments in the other assets you mentioned? I imagine that there would need to be some sort of financial incentive for the investors to choose those particular investments. Like, say, a return for the risk they take with their capital.Or are you suggesting that the government should be redirecting more tax dollars to those productive assets? The government doesn't have a good track history with any of these things. What are you proposing to change this? More dollars is not the answer, neither is more centralised control of how those dollars are spent.
I am happy to work with you here. But you will need to go beyond a few one liners and some platitudes to convince me. And I am easy to convince. It's the majority out there that chase trends that you really need to get on board.
Sorry, I wrote back to this before and the web page had an error. I will try again now.
I honestly don't know if a low/mid level investors can get involved with investing in emerging tech and social developments. I guess researching companies and shares is a way. It is just my opinion that less money being sunk into housing debt and more being sunk into invention and productivity will be beter for Australia overall.
No, I don't think it should be in any way government controlled. That would become a self serving, beaurocratic nightmare.
I guess the way I see it is that mid level investors (as I gather you are?) primarily save and then the banks use the lvr generated from the savings to invest in business and invention. Kind of a return to how it was pre 90s, when banks had a greater percentage of business loans than housing loans on their books.
Oh, as for the post above this – yes, Australia is different, isn't it? I've always believed that being inside a bubble makes it harder to spot, as it doesn't really look like one from that perspective.
ummester wrote:….more being sunk into invention and productivity will be beter for Australia overall.We are in complete agreement on this point. This may be the biggest challenge our nation is facing right now. I reckon we all start talking about this more with our contacts, friends, family and colleagues. The media and politicans will catch on later. We really need everyone discussing this and thinking innovation and productivity. Those two concepts together will turn this mining windfall into a long-term prosperous outcome for all Australians.
I would like to propose the following;
Let's create 5 ideas on how we can dramatically boost innovation and productivity in our country.Here are my 5 just plucked out of the air;
1) ALL scientific and associated product engineering research receives a 200% tax benefit.
2) A 200% tax benefit for any business that successfully brings a product developed from (1) to market to be sold anywhere.
3) Creation of a simple to understand and widely publicised process for linking (1) with (2) to speed products to market
4) A national ideas forum equivalent to TED (www.ted.com) but focused on Australian innovation and productivity. Every school, university and registered business is mandated to participate. Funded by the Future Fund and the NBN.
5) Direct NRAS-style incentives for any individual investing funds into (1) or (2).All I ask is that you work with the ideas and refrain from any critical/negative analysis at all. Let's be creative, innovative and productive! We clearly have some very smart people here, I am sure we can come up with at least one really good, workable idea that could change our nation for the better.
Comon, gimme your "5"!
hbbehrendorff wrote:This is going to be Fragmented but I don't care to write a proper formatted novel tonight.Don't listen to the baby boomer generation know it all's that have only seen rising house prices there entire life and think that "This is just the way it is"
"the driving force for housing price is supply and demand" is <moderator: delete language>. Accelerating debt and speculation is the driving force in rising house prices
Australia has the most expensive property in the world, At around 7x Average wages, The world average being closer to 3
I don't care what anyone tells you, Financing for a 500k house with a 4% GROSS rental yield is a LIABILITY, not an ASSET
You could have bought silver on the 3/1/2001 for $4.47 an ounce and sold on the 25/4/2011 for $49.78 which is a 1013.64% increase in 10 years or a 101.36% gain per year, But silver is a bad investment, You would have been much better off negatively gearing a -$200 a week cash flow property to invest for the long term because property ALWAYS goes up.
All capital cities are experiencing price reductions with Perth and Brisbane falling by around 7% and 6%. Wait and watch for much bigger falls in the near to mid term future before you go considering chaining yourself to a debt ball.
Any don't listen to the people trying to tell you what great property deals are out in Central Queensland, I live in emerald and I can tell you that paying astronomically high property prices for a fallen down wooden hut built in 1932 at a place like Dysart which rents out for 20 million dollars a week to a mining company at the height of a mining boom that cannot last forever is not that smart.
Watch for the day that those rentals are empty and the houses themselves cant even be given away, Though the 800k debt that bought the hut still remains.
Though don't try and argue with the Australian property zealots as property investing has become more of a religion then seeing the numbers through a educated, logical and mathematical worldview.
Remember above all though: Australia is DIFFERENT.
All I can say to that is: Sarcasm detected.
emptyvessel wrote:ummester wrote:….more being sunk into invention and productivity will be beter for Australia overall.I would like to propose the following;
Let's create 5 ideas on how we can dramatically boost innovation and productivity in our country.Comon, gimme your "5"!
1: Reduce the size of government, (The larger the size of the government the bigger the burden that is put on the private sector to fund it. As government employees paychecks come from collecting tax, reducing the amout of government "workers" would reduce tax burden in two ways.
1: More employees would be working in the private sector, which would have the effect of spreading the tax burden while also increasing productivity at the same time
2: Less government employees = Less government paychecks which = less taxes need to be collected to fill government coffers which = more available funds are free for private investment and innovation
3: Remove incentives for not working. 30%+ of tax revenues are spent on welfare, In Australia is it very easy to choose not to work at all, doing so will reward you greatly with a regular paycheck, cheap housing and virtually free health care.
Why work as a woman when you can enjoy in premarital sex, get knocked up twice in a row and sit at home for the next 20 years in luxury playing farmville on facebook, All government funded !
Ps: less people not being subsidized to sit at home would also increase productivity
4: Introduce laws to minimize or totally ban government debt.
When the private sector takes on debt, They have risk, If the debtor cannot pay there debts then they are punished (liquidation)
The government has no such risks for acquiring debt but politicians cannot resist it as they use it to fund there promises they cannot keep to further there own career, As such most governments go on wild orgy's of spending which in the long run hurts the tax payer.
Really I believe there is no reason for a government to get into debt to start with, They always collect a paycheck in boom or bust times and it should be there job to spend that money wisely and responsibly, There truly is NO gain to be had with government debt, All that happens is that you the tax payer is left to pay for tomorrows prosperity that was spent yesterday with added interest on top !
EG: I believe that the sate government of QLD's interest bill is now close to 100 million a week, That is 100 million a week that could have been spent on Improving our fail bruce highway, or even better yet, It could have been 100 million a week not stolen from the public in the first place which would leave more money for investment and innovation.
4: Abolish the compulsory 9% PAYG superannuation scheme for big fat cats law.
5: Return to a currency backed by real assets such as Gold/Silver instead of paper money backed by thin air, This would cause massive foreign investment
6: Lower taxes for Investors and Businesses so that it is more attractive to manufacture and produce in this country, Our current system is so backwards in that is rewards non producers and penalizes achievers
hbbehrendorff wrote:Why work as a woman when you can enjoy in premarital sex, get knocked up twice in a row and sit at home for the next 20 years in luxury playing farmville on facebook, All government funded !
Humorous but true.
hbbehrendorff wrote:6: Lower taxes for Investors and Businesses so that it is more attractive to manufacture and produce in this country, Our current system is so backwards in that is rewards non producers and penalizes achieversAgreed. We could perhaps generalise this to the everyday worker also. Working harder in an attempt to get more money is like pushing **** up a hill considering the tax we pay.
On another note, I wish the government would have a 'Medicare for animals' system in place. If I earned $1 for each person who complained about 'expensive' vet services and earned $0.10 for each person who thought vets were millionaires because they charge 'high' fees, I would be a real millionaire indeed.
Yes, decreasing the amount of government would be a good start. I have long held that a single country does not need national and state governing bodies – a national government overseeing councils ran mostly by residents should be enough. Then things like law, order, health, safety and so on could be controlled at a national level whilst more local issues like housing and what to do with education funding could be delt with at a council level. There would be crossovers of course – public transport would be best controlled nationally but organised locally.
While we're on breaking down the government, why not break down the states – do we even need them? What is wrong with everyone just living in Australia?
Obviously, less non productive debt creation. Less money on housing and sport. More on science, the arts and so on…
Solar power. Half of the country is a desert, we need a nationally funded sceme to use it for something.
Water dispersion. Half the country is wet 6 months of the year, we need a nationally funded sceme to do something about redistributing and sharing that resource.
Many things would go ahead more smoothly if we were a single Australia and not a collection of jealous states.
This is awesome! So many great ideas.
All for the single Australia idea. As a kid I never understood it. Reduces the government, more money to get stuff done, less government to get in the way of getting it done.
Water dispersal and national solar. Hell yeah! Now that's worth spending all that carbon tax on.
Agreed, get rid of the handouts and get everyone back to work.
Great stuff, keep it coming! I started another thread dedicated to this topic over in Opinionated! if anyone cares to post there; https://www.propertyinvesting.com/forums/community/opinionated/4337531
Its going to be intersting to see how the market reacts tomorrow.
I cant really see house prices going up in the next few years, more than likely down.
Bumping this thread in light of the Euro-crisis.
Italy and Greece are on the edge of a very steep drop.
In light of the Euro debt crisis, it could be timely to remind everyone what happened to Australia in the last great depression.
From wiki
Australia's extreme dependence on agricultural and industrial exports meant it was one of the hardest-hit countries in the Western world.[58] Falling export demand and commodity prices placed massive downward pressures on wages. Further, unemployment reached a record high of 29% in 1932,[59] with incidents of civil unrest becoming common. After 1932, an increase in wool and meat prices led to a gradual recovery.
We were hit later and harder than many places, as an exporter. Are we that different now? Replace GFC 1 & 2 with depression agriculture with rocks and I don't see too much difference… oh, other than that we have a bigger build up in property/residential land values this time around.
So are all those that are saying that the end is coming, or there abouts, are you all selling up your property and putting it into gold, cash, something else? Or don't you have property to begin with? Honest question!
Who says the end is coming? World didn't end after the great depression – there was a war but after that things really took off in a good way. I don't think of it as an end but a prerequisit for new, more sustainable growth.
And no, I don't have property, or much gold or shares. Just a healthy deposit and a reasonably secure job. I plan to use my deposit on the best thing it can afford me when the banks start asking for a minimum 20% down again.
Some are selling property, I think. Some are not. Doesn't really matter, if you can afford to hold it, no matter what happens to it's value over the next decade or so, it will eventually be worth more than whatever you paid for it again.
ummester wrote:And no, I don't have property, or much gold or shares. Just a healthy deposit and a reasonably secure job. I plan to use my deposit on the best thing it can afford me when the banks start asking for a minimum 20% down again.Personally I don't see any real reason to wait till the bank requires a minimum of 20% deposit before buying. It's been said that the best time to buy property is when you can afford to do so. Hence, if you're in a secure job and have a deposit handy (and in the right frame of mind to buy), put the 20-down and start looking (leaving 6% for other purchasing costs such as stamp duty, conveyancing and inspection fees). 20-down was also the limit I set for myself, even when the banks were prepared to go for 95% LVR with mortgage insurance.
emptyvessel wrote:ummester wrote:….more being sunk into invention and productivity will be beter for Australia overall.We are in complete agreement on this point. This may be the biggest challenge our nation is facing right now. I reckon we all start talking about this more with our contacts, friends, family and colleagues. The media and politicans will catch on later. We really need everyone discussing this and thinking innovation and productivity. Those two concepts together will turn this mining windfall into a long-term prosperous outcome for all Australians.
I would like to propose the following;
Let's create 5 ideas on how we can dramatically boost innovation and productivity in our country.Here are my 5 just plucked out of the air;
1) ALL scientific and associated product engineering research receives a 200% tax benefit.
2) A 200% tax benefit for any business that successfully brings a product developed from (1) to market to be sold anywhere.
3) Creation of a simple to understand and widely publicised process for linking (1) with (2) to speed products to market
4) A national ideas forum equivalent to TED (www.ted.com) but focused on Australian innovation and productivity. Every school, university and registered business is mandated to participate. Funded by the Future Fund and the NBN.
5) Direct NRAS-style incentives for any individual investing funds into (1) or (2).All I ask is that you work with the ideas and refrain from any critical/negative analysis at all. Let's be creative, innovative and productive! We clearly have some very smart people here, I am sure we can come up with at least one really good, workable idea that could change our nation for the better.
Comon, gimme your "5"!
Personally, I'm a fan of the TED ideas forum that is based in the US. It'd be great if we had that kind of thing here in Australia. Apparently there are some TEDx events in Australia (which are similar to regular TED events but smaller).
Apart from just the forum teaching ideas, it would be a great networking tool for innovators and entrepreneurs to join forces.
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