Welcome Guest [Log In] [Register]


Reply
  • Pages:
  • 1
  • 6
  • 28
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 (21,435 Views)
Shadow
Member Avatar
Evil Mouzealot Specufestor

John Frum
20 Jul 2014, 01:01 PM
There are plenty of discussions on other threads here as to how it was sustained. Which you never seem to participate in.
Give me an example - I participate in most threads. Besides, giving a reason why something has been sustained doesn't change the fact that it was sustained and is therefore sustainable.

Quote:
 
The main takeaway is that his rhetoric, like the Kouk's, is becoming progressively more gloomy.
Doesn't sound gloomy to me. He is saying a bubble could be developing, and if that's true then it will be awesome for people like myself and the majority of the population who already own property. If a bubble develops it will mean a huge ramp up in prices relative to incomes is coming up... you do realise this, right?

It would be pretty gloomy for bears like yourself admittedly. It just means another several years of being priced out of the market waiting for a crash, which, if it eventually comes, would just take prices back to present pre-bubble levels at best.
Edited by Shadow, 20 Jul 2014, 01:17 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.
Profile "REPLY WITH QUOTE" Go to top
 
Veritas
Default APF Avatar


Quote:
 
Incorrect. Don't forget there are two forms of ownership - outright owner, and owner with a mortgage. In both cases the buyer's name is on the title and they are recognised by law as the legal owner of the property.

Veritas and Chris can't afford to buy a home - they are just renters - i.e. they fall outside both categories of ownership. I was simply pointing out the fact that the majority of their peers already own one of those supposedly 'unaffordable' homes that Chris and Veritas can't afford to buy


You don't know anything about me dickhead.

It doesn't matter a jot whether i own one house or ten houses or whether you live in a cardboard box.

Nobody cares.

Quote:
 
My definition of a bubble is based on looking at data pertaining to every asset bubble that has ever burst. All of them, every single one, only burst after a strong rise in price/income ratios took prices to an unsustainable level - i.e. a price level that could no longer be justified by incomes.

It makes no sense to say Australia's current price/income ratio is unsustainable. It has been sustained for more than a decade!


And yet you cannot produce a single piece of academic literature that supports this view. Not one.

You know full well why that status quo has been maintained. It has been discussed here many,many times.

Please produce some evidence supporting your "iron law" or get off the stage.


Shadow
20 Jul 2014, 11:54 AM
Correct, the majority.

64% of households where the reference person is aged 35-44 years old are homeowner households.

And of the 45-54 year old agegroup that jumps to 76% being homeowners...

http://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/1301.0~2012~Main%20Features~Housing%20and%20life%20cycle%20stages~132
Because of the housing bubble, home ownership rates are dropping in the age cohorts mentioned.

Posted Image
Edited by Veritas, 20 Jul 2014, 01:46 PM.
Property acquisition as a topic was almost a national obsession. You couldn't even call it speculation as the buyers all presumed the price of property could only go up. That’s why we use the word obsession. Ordinary people were buying properties for their young children who had not even left school assuming they would not be able to afford property of their own when they left college- Klaus Regling on Ireland. Sound familiar?

The evidence of nearly 40 cycles in house prices for 17 OECD economies since 1970 shows that real house prices typically give up about 70 per cent of their rise in the subsequent fall, and that these falls occur slowly.
Morgan Kelly:On the Likely Extent of Falls in Irish House Prices, 2007
Profile "REPLY WITH QUOTE" Go to top
 
Shadow
Member Avatar
Evil Mouzealot Specufestor

Veritas
20 Jul 2014, 01:40 PM
You don't know anything about me dickhead.
I know you can't afford a home. You repeatedly tell us how unaffordable you find them.

Why the abuse?

Quote:
 
You know full well why that status quo has been maintained.
The price/income ratio has been maintained because it is sustainable - i.e. most people have sufficient income to be able to afford homes at current prices. Price/income ratios have been sustained for over a decade, and no bubble has ever burst after a decade of relatively stable price/income ratios.

Quote:
 
Because of the housing bubble, home ownership rates are dropping in the age cohorts mentioned.
Home ownership rates have dropped slightly because people are choosing to stay in education longer, travel more, get married later and have kids later in life. It follows they they choose to buy homes later too. But still, the majority of your peers do already own one.
Edited by Shadow, 20 Jul 2014, 01:58 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.
Profile "REPLY WITH QUOTE" Go to top
 
Ex BP Golly
Member Avatar


zaph
20 Jul 2014, 12:36 PM
It's extremely widely accept in Australia that 'ownership' relating to property refers to property that is owned with, or without a mortgage. The entity named on the title deed owns the house. A financier may be named on the deed, but they will be named as mortgagee, not owner.

If I have a personal loan on a car, do I own it?
If I buy a TV and pay for it on a credit card, do I own the TV?
Sorry, I don't accept it.

Own is a very specific word, and a person doesnt own anything till it is paid in full. They may possess, but they dont own.

The only thing most "owners" own, is an obligation to a bank. As soon as they fail to meet their obligations, their possession is lost them.

They cannot do all sorts of things with this thing they pretend to 'own' without first seeking the banks permission, like sell it, or rent it, or demolish it, or demolish a wall, or paint it pink, or yellow or whatever colour Shady carries on about.

Only owners can do these things.

As someone who actually owns land (with a home amongst other things on it) with no obligations over it, I can see the distinction.

I think Herbie also counts as an owner.

How many others here are owners is questionable.
WHAT WOULD EDDIE DO? MAAAATE!
Share a cot with Milton?
Profile "REPLY WITH QUOTE" Go to top
 
Shadow
Member Avatar
Evil Mouzealot Specufestor

Ex BP Golly
20 Jul 2014, 01:57 PM
Sorry, I don't accept it.
You can refuse to accept the official definition if you wish. It doesn't really matter. It doesn't change the fact that most of Veritas' and Chris' peers already own (either outright or with a mortgage) one of those homes that Chris and Veritas can't afford to buy.
Ex BP Golly
20 Jul 2014, 01:57 PM
They cannot do all sorts of things with this thing they pretend to 'own' without first seeking the banks permission, like sell it, or rent it, or demolish it, or demolish a wall, or paint it pink, or yellow or whatever colour
You honestly think people can't knock down a wall or paint the house without the banks permission? Really?

The only thing on your list that the bank would be concerned about is demolishing the house.

On selling you'll need to pay out the mortgage with the sale proceeds, but you don't need bank 'permission' to sell.
Edited by Shadow, 20 Jul 2014, 02:11 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.
Profile "REPLY WITH QUOTE" Go to top
 
Veritas
Default APF Avatar


Shadow
20 Jul 2014, 01:55 PM
I know you can't afford a home. You repeatedly tell us how unaffordable you find them.

Why the abuse?


The price/income ratio has been maintained because it is sustainable - i.e. most people have sufficient income to be able to afford homes at current prices. Price/income ratios have been sustained for over a decade, and no bubble has ever burst after a decade of relatively stable price/income ratios.


Home ownership rates have dropped slightly because people are choosing to stay in education longer, travel more, get married later and have kids later in life. It follows they they choose to buy homes later too. But still, the majority of your peers do already own one.
Yeah, yeah, heard it all before mate.

So your iron law of housing bubbles.

Managed to find anyone apart from yourself making this claim?

One person even?

Thought not.
Property acquisition as a topic was almost a national obsession. You couldn't even call it speculation as the buyers all presumed the price of property could only go up. That’s why we use the word obsession. Ordinary people were buying properties for their young children who had not even left school assuming they would not be able to afford property of their own when they left college- Klaus Regling on Ireland. Sound familiar?

The evidence of nearly 40 cycles in house prices for 17 OECD economies since 1970 shows that real house prices typically give up about 70 per cent of their rise in the subsequent fall, and that these falls occur slowly.
Morgan Kelly:On the Likely Extent of Falls in Irish House Prices, 2007
Profile "REPLY WITH QUOTE" Go to top
 
Shadow
Member Avatar
Evil Mouzealot Specufestor

Veritas
20 Jul 2014, 02:03 PM
Managed to find anyone apart from yourself making this claim?
I don't need other people to present the same argument... an argument stands on its own merit. No bubble has ever popped after a decade of relatively stable price/income ratios. This is a fact, regardless of how many people point it out.
Edited by Shadow, 20 Jul 2014, 02:10 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.
Profile "REPLY WITH QUOTE" Go to top
 
And
Unregistered

Shadow
20 Jul 2014, 02:00 PM
You can refuse to accept the official definition if you wish. It doesn't really matter. It doesn't change the fact that most of Veritas' and Chris' peers already own (either outright or with a mortgage) one of those homes that Chris and Veritas can't afford to buy.
And conversely, they are liable for a mortgage that Veritas and Chris are not.

Or has liability for one's debts been legislated away recently?
"REPLY WITH QUOTE" Go to top
 
zaph
Default APF Avatar


Ex BP Golly
20 Jul 2014, 01:57 PM

, They may possess, but they dont own.

The only thing most "owners" own, is an obligation to a bank. As soon as they fail to meet their obligations, their possession is lost them.


Only owners can do these things.

As someone who actually owns land (with a home amongst other things on it) with no obligations over it, I can see the distinction.

I think Herbie also counts as an owner.

How many others here are owners is questionable.
Quote:
 
Sorry, I don't accept it.


That's fine. You can have your own terminology, that the vast majority of Australians don't use.

Perhaps you should return to the ye olde terminology of owning, buying and renting?

Quote:
 
Own is a very specific word


"To possess by right; to have the right of property in; to have the legal right or rightful title to." -http://en.wiktionary.org/wiki/own

Quote:
 
and a person doesnt own anything till it is paid in full.


So I don't own the TV and kettle that I purchased yesterday on my credit card?

Quote:
 
They cannot do all sorts of things with this thing they pretend to 'own' without first seeking the banks permission, like sell it, or rent it, or demolish it, or demolish a wall, or paint it pink, or yellow or whatever colour Shady carries on about.


I'm sure my bank would not be concerned if I painted a wall pink, yellow or ever green. My LL might be.

Profile "REPLY WITH QUOTE" Go to top
 
Veritas
Default APF Avatar


Shadow
20 Jul 2014, 02:06 PM
I don't need other people to present the same argument... an argument stands on its own merit. No bubble has ever popped after a decade of relatively stable price/income ratios. This is a fact, regardless of how many people point it out.
Lots of things happen that haven't happened before.

You are making a very specific claim: housing bubbles must inflate and then deflate at one inflection point.

That may have happened in other countries but that does not mean that all bubbles must cleave to this model.

And you cannot produce a single piece of evidence to support this proposition.

It is eminently possible that Government intervention and favorable (and fluid) economic circumstances have served to keep the Australian housing bubble inflated longer than would have otherwise been the case.

You have said that you have an iron law and yet I cannot find any piece of literature that supports this view.

In fact, all the discussion I have read about bubbles have one thing in common: bubbles deflate when sentiment does a volte face, investors start rushing for the door and demand drops in anticipation of price falls creating a deflationary spiral.

As far as I'm concerned Australia is still in the grips of the housing market as get quick rich scheme. The VIs still have a firm grip of the microphone and the people more or less still believe them. Sentiment has not changed.

As you said yourself 500,000 people are still buying houses each year.

You think thats sustainable because its been sustained for ten years. That is an opinion not a fact.

Get off the stage.

You've got nothing.

Property acquisition as a topic was almost a national obsession. You couldn't even call it speculation as the buyers all presumed the price of property could only go up. That’s why we use the word obsession. Ordinary people were buying properties for their young children who had not even left school assuming they would not be able to afford property of their own when they left college- Klaus Regling on Ireland. Sound familiar?

The evidence of nearly 40 cycles in house prices for 17 OECD economies since 1970 shows that real house prices typically give up about 70 per cent of their rise in the subsequent fall, and that these falls occur slowly.
Morgan Kelly:On the Likely Extent of Falls in Irish House Prices, 2007
Profile "REPLY WITH QUOTE" Go to top
 
1 user reading this topic (1 Guest and 0 Anonymous)
ZetaBoards - Free Forum Hosting
Enjoy forums? Start your own community for free.
Go to Next Page
« Previous Topic · Australian Property Forum · Next Topic »
Reply
  • Pages:
  • 1
  • 6
  • 28



Australian Property Forum is an economics and finance forum dedicated to discussion of Australian and global real estate markets and macroeconomics, including house prices, housing affordability, and the likelihood of a property crash. Is there an Australian housing bubble? Will house prices crash, boom or stagnate? Is the Australian property market a pyramid scheme or Ponzi scheme? Can house prices really rise forever? These are the questions we address on Australian Property Forum, the premier real estate site for property bears, bulls, investors, and speculators. Members may also discuss matters related to finance, modern monetary theory (MMT), debt deflation, cryptocurrencies like Bitcoin Ethereum and Ripple, property investing, landlords, tenants, debt consolidation, reverse home equity loans, the housing shortage, negative gearing, capital gains tax, land tax and macro prudential regulation.

Forum Rules: The main forum may be used to discuss property, politics, economics and finance, precious metals, crypto currency, debt management, generational divides, climate change, sustainability, alternative energy, environmental topics, human rights or social justice issues, and other topics on a case by case basis. Topics unsuitable for the main forum may be discussed in the lounge. You agree you won't use this forum to post material that is illegal, private, defamatory, pornographic, excessively abusive or profane, threatening, or invasive of another forum member's privacy. Don't post NSFW content. Racist or ethnic slurs and homophobic comments aren't tolerated. Accusing forum members of serious crimes is not permitted. Accusations, attacks, abuse or threats, litigious or otherwise, directed against the forum or forum administrators aren't tolerated and will result in immediate suspension of your account for a number of days depending on the severity of the attack. No spamming or advertising in the main forum. Spamming includes repeating the same message over and over again within a short period of time. Don't post ALL CAPS thread titles. The Advertising and Promotion Subforum may be used to promote your Australian property related business or service. Active members of the forum who contribute regularly to main forum discussions may also include a link to their product or service in their signature block. Members are limited to one actively posting account each. A secondary account may be used solely for the purpose of maintaining a blog as long as that account no longer posts in threads. Any member who believes another member has violated these rules may report the offending post using the report button.

Australian Property Forum complies with ASIC Regulatory Guide 162 regarding Internet Discussion Sites. Australian Property Forum is not a provider of financial advice. Australian Property Forum does not in any way endorse the views and opinions of its members, nor does it vouch for for the accuracy or authenticity of their posts. It is not permitted for any Australian Property Forum member to post in the role of a licensed financial advisor or to post as the representative of a financial advisor. It is not permitted for Australian Property Forum members to ask for or offer specific buy, sell or hold recommendations on particular stocks, as a response to a request of this nature may be considered the provision of financial advice.

Views expressed on this forum are not representative of the forum owners. The forum owners are not liable or responsible for comments posted. Information posted does not constitute financial or legal advice. The forum owners accept no liability for information posted, nor for consequences of actions taken on the basis of that information. By visiting or using this forum, members and guests agree to be bound by the Zetaboards Terms of Use.

This site may contain copyright material (i.e. attributed snippets from online news reports), the use of which has not always been specifically authorized by the copyright owner. Such content is posted to advance understanding of environmental, political, human rights, economic, democratic, scientific, and social justice issues. This constitutes 'fair use' of such copyright material as provided for in section 107 of US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed for research and educational purposes only. If you wish to use this material for purposes that go beyond 'fair use', you must obtain permission from the copyright owner. Such material is credited to the true owner or licensee. We will remove from the forum any such material upon the request of the owners of the copyright of said material, as we claim no credit for such material.

For more information go to Limitations on Exclusive Rights: Fair Use

Privacy Policy: Australian Property Forum uses third party advertising companies to serve ads when you visit our site. These third party advertising companies may collect and use information about your visits to Australian Property Forum as well as other web sites in order to provide advertisements about goods and services of interest to you. If you would like more information about this practice and to know your choices about not having this information used by these companies, click here: Google Advertising Privacy FAQ

Australian Property Forum is hosted by Zetaboards. Please refer also to the Zetaboards Privacy Policy