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Christopher Joye turns bear - Australian housing bubble is now here; House prices have inflated at a 9.5% annualised pace (triple wages growth)
Topic Started: 19 Jul 2014, 01:12 PM (21,438 Views)
Chris
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bob
19 Jul 2014, 09:36 PM
maybe you can get your own facts right first?

in the USA negative gearing is even more generous, it also exists in other countries like germany, sweden, NZ the list is pretty long.
Bob, my facts are right. No other nation in the world allows you to borrow money to buy an asset making a loss and then allow you to reduce your income tax significantly to counter this, then allow you to claim all associated costs of ownership as well. The US has nothing like that in housing at all, nor does any other country your an idiot if you think they do!!!
Edited by Chris, 19 Jul 2014, 10:35 PM.
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Kulganis
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Chris
19 Jul 2014, 10:34 PM
Bob, my facts are right. No other nation in the world allows you to borrow money to buy an asset making a loss and then allow you to reduce your income tax significantly to counter this, then allow you to claim all associated costs of ownership as well. The US has nothing like that in housing at all, nor does any other country your an idiot if you think they do!!!
The US does, but it's nothing like here, in the US, you can claim up to US$25,000, so long as your income is below US$150,000; if I remember right. It changes depending on if you're single or married (for tax purposes) too.
"If man is to survive, he will have learned to take a delight in the essential differences between men and between cultures. He will learn that differences in ideas and attitudes are a delight, part of life's exciting variety, not something to fear." - Gene Roddenberry

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stinkbug
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Chris
19 Jul 2014, 10:34 PM
Bob, my facts are right. No other nation in the world allows you to borrow money to buy an asset making a loss and then allow you to reduce your income tax significantly to counter this, then allow you to claim all associated costs of ownership as well. The US has nothing like that in housing at all, nor does any other country your an idiot if you think they do!!!
The US has neat rules where you don't pay CGT if you reinvest the money in another asset.
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Shadow
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Veritas
19 Jul 2014, 08:43 PM
There is no iron law of bubble as you are suggesting and I defy you to find anyone of repute that says there is.
There is an iron law. Every single bubble in history that has ever burst (in any asset class) has demonstrated a very large increase in price/income ratios for many years immediately prior to the bubble bursting. You will not be able to find a single case of a bubble ever popping after a decade of relatively steady price/income ratios. I challenge you to find a single example. You won't be able to... not in property or any other asset class ever.


Drgonzo
19 Jul 2014, 08:56 PM
The chart you used in your post tells the whole story chief, look at how it peaks around 2003 and well above the "long run average".
The chart I posted shows it to be about 20% above the long run average, which is easily explained by the fact that banks now lend based on dual incomes. The rise in price/income ratios that occurred during the late 90s and early 2000s was a result of financial deregulation. That process had played out by 2003, from which time prices have simply tracked income growth. Perhaps you would like to explain why house prices can't keep tracking income growth as they have done for over a decade now?


Chris
19 Jul 2014, 09:25 PM
Australia is very different with NG, there is nothing like it (comparing apples for apples) in the world
Incorrect.

Negative Gearing available in many countries

The charts below cover some of the main countries in the world, but it's not comprehensive. There are over 200 countries in the world, so I expect the real number that support negative gearing is even larger...

Posted Image

Posted Image


Chris
19 Jul 2014, 10:34 PM
Bob, my facts are right. No other nation in the world allows you to borrow money to buy an asset making a loss and then allow you to reduce your income tax significantly to counter this, then allow you to claim all associated costs of ownership as well. The US has nothing like that in housing at all, nor does any other country your an idiot if you think they do!!!
LOL, I love the way bears are so sure of themselves, while being so wrong about everything! :lol

Look Chris, I get the fact that you can't afford a home, but you have to accept that this is probably because you have squandered your finances.

Assuming you're in your 30s to 40s, the majority of your peers already own homes. The majority of people your age and who earn a similar income to you already own one of those homes that you find so unaffordable. Just because you can't afford to buy a home doesn't mean nobody else can!

If housing was really unaffordable then how come so many people can afford to buy them, and mortgage default rates are so low?
Edited by Shadow, 19 Jul 2014, 11:01 PM.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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bob
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Chris
19 Jul 2014, 10:34 PM
Bob, my facts are right. No other nation in the world allows you to borrow money to buy an asset making a loss and then allow you to reduce your income tax significantly to counter this, then allow you to claim all associated costs of ownership as well. The US has nothing like that in housing at all, nor does any other country your an idiot if you think they do!!!
I just listed 4 that do, but there's plenty more who allow it. hell in the USA owner occupiers can do it.

If you lose money on an investment it reduces you taxable income in the same way a profit on it increases it. this is a basic tenent of most tax systems.

It isn't a hard concept to grasp for most people...
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Chris
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Shadow
19 Jul 2014, 10:47 PM
There is an iron law. Every single bubble in history that has ever burst (in any asset class) has demonstrated a very large increase in price/income ratios for many years immediately prior to the bubble bursting. You will not be able to find a single case of a bubble ever popping after a decade of relatively steady price/income ratios. I challenge you to find a single example. You won't be able to... not in property or any other asset class ever.



The chart I posted shows it to be about 20% above the long run average, which is easily explained by the fact that banks now lend based on dual incomes. The rise in price/income ratios that occurred during the late 90s and early 2000s was a result of financial deregulation. That process had played out by 2003, from which time prices have simply tracked income growth. Perhaps you would like to explain why house prices can't keep tracking income growth as they have done for over a decade now?



Incorrect.

Negative Gearing available in many countries

The charts below cover some of the main countries in the world, but it's not comprehensive. There are over 200 countries in the world, so I expect the real number that support negative gearing is even larger...

Posted Image

Posted Image



LOL, I love the way bears are so sure of themselves, while being so wrong about everything! :lol

Look Chris, I get the fact that you can't afford a home, but you have to accept that this is probably because you have squandered your finances.

Assuming you're in your 30s to 40s, the majority of your peers already own homes. The majority of people your age and who earn a similar income to you already own one of those homes that you find so unaffordable. Just because you can't afford to buy a home doesn't mean nobody else can!

If housing was really unaffordable then how come so many people can afford to buy them, and mortgage default rates are so low?
You have no idea about my personal situation shadow, when I buy a home I will be light years in front of the few friends I know who have jumped in on interest only 40yr loans in deer park and surrounds.

And you have not proven a thing, I didn't say that NG didn't exist in these countries what I did say is none them have as generous scheme as we do in Australia.

So I'm not wrong you have just remained true to form and presented a whole lot of grey and no black and white. By the way where's my BLACK AND WHITE figures for your decade of incomes vs house price ratios??
Edited by Chris, 19 Jul 2014, 11:22 PM.
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Shadow
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Chris
19 Jul 2014, 11:20 PM
I didn't say that NG didn't exist in these countries what I did say is none them have as generous scheme as we do in Australia.
Most of those in the tables I posted have negative gearing provisions that are very similar to Australia.

Japan, New Zealand, Germany, Sweden are pretty much identical to us.

You have been brainwashed by the likes of Macrobusiness into believing absolute nonsense.

Quote:
 
By the way where's my BLACK AND WHITE figures for your decade of incomes vs house price ratios?
ABS House Price Index... http://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/6416.0Mar%202014
Dec 2003: 71.6
Dec 2013: 112.4
A rise of 57%

ABS Full-time adult ordinary time earnings... http://www.abs.gov.au/AUSSTATS/abs@.nsf/allprimarymainfeatures/6DE6B93557535756CA256E9900785A87
Nov 2003: 939.6
Nov 2013: 1437.7
A rise of 53%

So wages up 53% and house prices up 57% over the past decade - i.e. the house price to income ratio has barely changed.
Edited by Shadow, 19 Jul 2014, 11:35 PM.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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Kulganis
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Shadow
19 Jul 2014, 10:47 PM
If housing was really unaffordable then how come so many people can afford to buy them, and mortgage default rates are so low?
I'm not 100% sure, but it couldn't have anything to do with the fact that the standard variable mortgage interest rate hasn't been lower since 1963 could it?
"If man is to survive, he will have learned to take a delight in the essential differences between men and between cultures. He will learn that differences in ideas and attitudes are a delight, part of life's exciting variety, not something to fear." - Gene Roddenberry

"Balloon animals are a great way to teach children that the things they love dearly, may spontaneously explode" -- Lee Camp
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Shadow
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Kulganis
19 Jul 2014, 11:37 PM
I'm not 100% sure, but it couldn't have anything to do with the fact that the standard variable mortgage interest rate hasn't been lower since 1963 could it?
Mortgage rates were close to double digits in 2008. People could still afford their homes.

We have had both high and low mortgage rates over the past decade when the bears claim homes have been 'unaffordable'.

Yet people kept on buying homes, and very few people defaulted on their loans.

Posted Image


Chris
19 Jul 2014, 11:20 PM
You have no idea about my personal situation shadow, when I buy a home I will be light years in front of the few friends I know who have jumped in on interest only 40yr loans in deer park and surrounds.
You will never buy a home. You can't afford one.
Edited by Shadow, 19 Jul 2014, 11:44 PM.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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Chris
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Shadow
19 Jul 2014, 11:29 PM
Most of those in the tables I posted have negative gearing provisions that are very similar to Australia.

Japan, New Zealand, Germany, Sweden are pretty much identical to us.

You have been brainwashed by the likes of Macrobusiness into believing absolute nonsense.


ABS House Price Index... http://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/6416.0Mar%202014
Dec 2003: 71.6
Dec 2013: 112.4
A rise of 57%

ABS Full-time adult ordinary time earnings... http://www.abs.gov.au/AUSSTATS/abs@.nsf/allprimarymainfeatures/6DE6B93557535756CA256E9900785A87
Nov 2003: 939.6
Nov 2013: 1437.7
A rise of 53%

So wages up 53% and house prices up 57% over the past decade - i.e. the house price to income ratio has barely changed.
Tell me the EXACT NG deductions, exemptions and allowances for IP for individuals in the US and let's see how identical it really is compared to Australia. That's why you call yourself shadow, you spend most if the time hiding in them.

And AGAIN, the exact wage and the exact house prices over the decade. You must also disclose whether it is based on dual incomes and if so what is the total household income for each year of the decade and the house price for each year. You know BLACK AND WHITE!!
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