Relatives of mine are experiencing this at present. They bought a house - to live in, not as an investment - in a small community that was once a thriving ore-mining town. The the ore was still there but the deposit was small compared to the enormous mega-mines we currently export from so I suppose it wasn't economically viable. They paid about $17 000 for a house on half-an-acre with a second adjoining block. They lived there for about a decade before moving back to Queensland. When it looked as though China was going to buy every last crumb of ore that Australia could dig up and pay ever-increasing prices for it, the mine was re-opened and prices in the town soared from low double-digits into the hundreds of thousands. They are pensioners without much money but they were able to borrow against the now vastly larger value in their house and bought a good new 4WD to tow their van.
However, the boom is now going bust and houses in the town have stopped selling. They have just been stung for $6000 for repairs to the roof that insurance refuses to pay for. While house prices tend to be sticky downward, I fear that the old house is likely to become a money-sink and there is virtually nothing there to retain the value but it will require costly ongoing repairs. Even if it is still technically worth $100 000 you have to be able to find a willing buyer before you can realise that value - if no one is willing to buy then it is really worth nothing in a monetary sense.
You never really know how things are going to turn out but I think I would be trying to flog the thing for whatever I could get for it before it morphs from an asset into a liability.
I've spent $10000 on the garden alone this year. It's amazing how houses suck the money out of you.
Whenever you have an argument with someone, there comes a moment where you must ask yourself, whatever your political persuasion, 'am I the Nazi?'
It's amazing how houses suck the money out of you.
Same can be said for just about anything. It's amazing how cars suck the money out of you It's amazing how eating good food suck's the money out of you It's amazing how drinking fine wines suck's the money out of you
It costs money to live if you want more than a cardboard box to live in or eat better than gruel.
Lef-tee
5 Aug 2014, 07:04 AM
They are pensioners without much money but they were able to borrow against the now vastly larger value in their house and bought a good new 4WD to tow their van.
New? Silly them when near new is available at HUGE discounts.
Ignore posts by The Whole Truth · View Post · End Ignoring The forum fuckwit goes RRRAAARRRGGHHhhh - But not a fuck was given..................by anyone.
If you read up the thread a bit, I have acknowledged your definition of net worth as being correct (in my reply to Dave). However, property is an illiquid asset that can't be realised by just placing a sell order. Dublin was full of property millionaires one minute and bankrupts the next.
With property you always have the option to hold and sit tight. Those Dublin millionaires are now seeing their equity return again, another year or so and those millions will be growing again.
House prices can also take off very rapidly, witness Sydney, Dublin and London. All these cities have grown at close to 20% last year.
There is usually more upside than downside risk associated with money invested in property.
Definition of a doom and gloomer from 1993 The last camp is made up of the doom-and-gloomers. Their slogan is "it's the end of the world as we know it". Right now they are convinced that debt is the evil responsible for all our economic woes and must be eliminated at all cost. Many doom-and-gloomers believe that unprecedented debt levels mean that we are on the precipice of a worse crisis than the Great Depression. The doom-and-gloomers hang on the latest series of negative economic data.
Id say Warren has shares in more than one company.
And can sell those shares in a nanosecond if he so wishes.
In marked contrast to our "eggs in one basket" cottage industry of property speculators.
Housing is the most illiquid asset of all as lots of WA property investors are learning right now in their rush for the door.
If Warren Buffet had BH sell all its shares in a nanosecond it would crash the US stock markets and maybe a whole lot of others and destroy a lot of wealth.
I can't think of a comment that could be more of an own goal.
With property you always have the option to hold and sit tight. Those Dublin millionaires are now seeing their equity return again, another year or so and those millions will be growing again.
House prices can also take off very rapidly, witness Sydney, Dublin and London. All these cities have grown at close to 20% last year.
There is usually more upside than downside risk associated with money invested in property.
The leveraged property developers in Dublin were wiped out overnight. I was in Dublin two years ago and there were still half finished buildings for sale. You can't sit and hold if you are up to your ears in debt and your income source (the sale of your properties for a profit) has been wiped out.
The biggest risk in any market is when investors believe that there is no risk.
Matthew, 30 Jan 2016, 09:21 AM Your simplistic view is so flawed it is not worth debating. The current oversupply will be swallowed in 12 months. By the time dumb shits like you realise this prices will already be rising.
If you read up the thread a bit, I have acknowledged your definition of net worth as being correct (in my reply to Dave). However, property is an illiquid asset that can't be realised by just placing a sell order. Dublin was full of property millionaires one minute and bankrupts the next.
At the time I wrote my reply, I hadn't read your acknowledgement but I have now. All the more silly of Veritas for trying to turn it into bull vs bear cheerleading when both of us are agreeing on the same thing.
Veritas, you used to post very worthwhile reads and I used to read all your post because I felt you stuck to facts. Nowadays, all your posts seem to be out of anger and spite for Shadow (and other bulls) and will say anything to score a cheap shot at them. So you now join the ignore lists with other full retard bears like moops and crazy dave. You probably won't miss me either but life is getting busier and I don't have time to read your dribble anymore.
One worrying thing is the amount of debt that young FIFO workers take on. Some of the older ones are just as bad. I do a mix of city based and on site work and when I am on site I earn over double my normal wages. I also have zero living expenses on site as well. I treat the additional money as a bonus and not as part of my normal pay. I know that FIFO can be short lived so I don't rely on it.
What a very odd statement for a company director to make.
So odd, you were either lying then or you are lying now.
My only hope for my three boys is that they turn out nothing at all like Chris.
What a very odd statement for a company director to make.
So odd, you were either lying then or you are lying now.
Wow Matey, you must have spent hours today reading back through old threads trying to find something to trip me up with.
Like some kind of demented stalker.
A hunter if you like.
But who is the one being hunted Matey?
Fill in the blanks Matey.
Go on.
Matthew, 30 Jan 2016, 09:21 AM Your simplistic view is so flawed it is not worth debating. The current oversupply will be swallowed in 12 months. By the time dumb shits like you realise this prices will already be rising.
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.
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