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The Perth Property Crash Thread; Let us enjoy the inevitable collapse as it unfolds in WA
Topic Started: 13 Aug 2014, 12:28 AM (89,648 Views)
Mike
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Jimbo
17 Aug 2014, 04:06 PM
OK Mike,

I have just been to look at a $389k property. It is a 3x1 on 650m2, 1980's build (a bit small). Excellent decorative order, 400m from the beach in Waikiki. Ideal for a 1st time buyer or investor.

Very tempting. However, much closer to the beach is a two storey property on 850m2 with up to date features, excellent concrete pool and ocean glimpses for $599k. This same property was listed at 1.2 million in 2007 and 800k in 2011. They turned down 850k in 2007 (I made the offer).

It has been on at $599k for six weeks.

So the difference between a starter home and a luxury dwelling has been reduced from 700k to 210k in a matter of a few years.

This is not an isolated case either.

Mid to top end houses in Perth were pumped by big earning, mining related jobs and now they are being deflated by the reduction in requirements for the same workers.

The bottom end is staying afloat because although expensive, it is just within the reaches of non mining related workers.

We now have two markets in Perth. The bottom end is in touch with reality and the top end is about to discover reality.

So my prediction. Bottom end to stay stable or increase with inflation for the next six months. Top end to crash back below the trough of four years ago (and maybe more).



Those longer term posters are all jumping to your defence right now and I hate to think what will happen to me when your many blog followers all start to pile in as well.

I am new to this forum thingy. I bow to your platinum membership status I hope that one day, I am considered worthy of attaining the dizzy heights that you have along with the perks that go with it.

I am not worthy.
Nice attempt to distort the truth.

If the prices are as you say, there is easily traceable sales history or asking prices if you provide the address of the property, I might try and find it myself later. Can't be to hard to find a $599 property in a small area.

After the GFC areas of rockingham and Mandurah got smashed. As the primary customers retires and rich people looking for holiday homes disappeared. This region dropped some 30% if not more. It was overvalued but that was due to competition from people with a lot of money. $1.2 million for Waikiki is crazy. You can buy modern large properties with uninterrupted ocean views close to Fremantle for this price 15-20km to the CBD not 50km like Waikiki.

Prices now in Waikiki and the greater peel area represent good buying, cheap for what you get. In my opinion this region has one of the greatest prospects for growth in the coming years. The rest of Perth May slow in the next few years but this area could record good gains, simply due to affordability, close to beaches and peel inlet. My family have lived in this region since the 1950's so I know the region very well.

$599 for a property close to the beach which you say is luxury, sounds like it is now reasonably priced. You might get it a little cheaper. Why not put in an offer.
Edited by Mike, 17 Aug 2014, 05:26 PM.
http://mike-globaleconomy.blogspot.com.au/
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skamy
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Jimbo
17 Aug 2014, 05:20 PM
Very true, but you continue to spruik the market along with your mate Mike.

Almost as though your lives depended on it.


I am not a broken clock. I have been a bull in Perth property since 2007. I have finished my bull run and now I am a bear.

Same as with any asset. They go up, they go down.
Ok, so what is your call is it for a fire sale of investment properties or a fire sale of luxury property?

I do not spruik the market I tell my view and my experience and I advice caution on believing tales of crashing markets. These are very rare events that is just a fact. You have so much riding on this crash speculation that you seem not to see that both Mike and I are taking a cautious steady as she goes view. You and Perthite and Veritas are predicting an extreme event, one that has rarely been seen in WA.

My buying and selling is done and dusted for a decade now so I am not speculating in the market other than she should be great over 10 years.

Perth has a stable economy, wages are growing, unemployment is low there will be no big crash, the odds are stacked so far against this, IMHO you seem to be taking a huge risk for pretty low potential gains.
Edited by skamy, 17 Aug 2014, 05:43 PM.
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.
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Jimbo
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skamy
17 Aug 2014, 05:18 PM
jumbo that is not the way it works, even a broken clock will be right twice a day. The GFC has been and gone and Australia did not crash like Ireland therefore it's economy was not the same as Ireland and it did not have a bubble like Ireland.

Now tell me what is your view are you predicting a mass sale of investor properties or a mass sale of luxury properties? They are two entirely different markets , luxury property do not make good investment properties.
My own opinion (because that it all it is), is that upper tier properties are overly expensive given that they were bid up in value by people earning way more than they normally would if it were not for the mining infrastructure boom.

Lower tier properties have been bid up by the same people stocking up on investment properties to increase their wealth.

Perth is set for a downturn in average wages as the mining infrastructure boom recedes.

This will lead to (is already happening) a fall in immigration as Perth ceases to become paved with gold.

As immigration falls back, rental demand will fall (is falling).

As new build property gets cheaper to buy (government incentives), more FTB will buy new over established.

As each new build is completed, a rental will be emptied.

As rental demand falls, the incentive to buy investment property will fall in lock step.

Meanwhile, those with the most negatively geared properties will sell to get out at the peak at the same time as demand is falling.

Conclusion?

Perth is fucked. (but that is just my opinion).

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.
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Mike
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Jimbo
17 Aug 2014, 05:36 PM
My own opinion (because that it all it is), is that upper tier properties are overly expensive given that they were bid up in value by people earning way more than they normally would if it were not for the mining infrastructure boom.

Lower tier properties have been bid up by the same people stocking up on investment properties to increase their wealth.

Perth is set for a downturn in average wages as the mining infrastructure boom recedes.

This will lead to (is already happening) a fall in immigration as Perth ceases to become paved with gold.

As immigration falls back, rental demand will fall (is falling).

As new build property gets cheaper to buy (government incentives), more FTB will buy new over established.

As each new build is completed, a rental will be emptied.

As rental demand falls, the incentive to buy investment property will fall in lock step.

Meanwhile, those with the most negatively geared properties will sell to get out at the peak at the same time as demand is falling.

Conclusion?

Perth is fucked. (but that is just my opinion).
Can you provide a link which shows the house you refer to for sale for $599,000 as I can find no such listed property for that price.

You have one story houses close to the beach for around that price, but they are dated and far from what I would call luxury. There is one 2 storey house about 1km from the beach that looks more modern but this is on the market for $650k.

Where does your invisible 2 storey luxury house, close to the beach with ocean glimpses, concrete pool on a large block. When single story houses on smaller blocks, far from luxury and dated are of similar price in that location.

It would seem you have found a bargain, if it exists which I find hard to believe when looking at other houses in the area for that price range.
The only 3x1 listed in Waikiki for $389,000 close to the beach is 20 Viking Road. It is 692sqm. Looks like a reasonable price for some one wanting to live in that location.
Edited by Mike, 17 Aug 2014, 06:02 PM.
http://mike-globaleconomy.blogspot.com.au/
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Jimbo
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Mike
17 Aug 2014, 05:51 PM
Can you provide a link which shows the house you refer to for sale for $599,000 as I can find no such listed property for that price.

You have one story houses close to the beach for around that price, but they are dated and far from what I would call luxury. There is one 2 storey house about 1km from the beach that looks more modern but this is on the market for $650k.

Where does your invisible 2 storey luxury house, close to the beach with ocean glimpses, concrete pool on a large block. When single story houses on smaller blocks, far from luxury and dated are of similar price in that location.

It would seem you have found a bargain, if it exists which I find hard to believe when looking at other houses in the area for that price range.
The only 3x1 listed in Waikiki for $389,000 close to the beach is 20 Viking Road. It is 692sqm. Looks like a reasonable price for some one wanting to live in that location.
Unlike you Mike, I don't make shit up.

http://www.realestate.com.au/property-house-wa-warnbro-117449671
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.
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Mike
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Did a search in Waikiki for properties with land over 800sqm in the $550-$600,000 price band. Nothing, not even a single storey at that price let alone very close to the beach.

Don't you hate when some one catches you out lying. Link to the listed property for sale? Even a street name will do.
http://mike-globaleconomy.blogspot.com.au/
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Jimbo
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Mike
17 Aug 2014, 05:51 PM
]The only 3x1 listed in Waikiki for $389,000 close to the beach is 20 Viking Road. It is 692sqm. Looks like a reasonable price for some one wanting to live in that location.
That's the one I looked at. Now tell me, would you buy it for 389k knowing that for another 210k you could have the one on Fendham Street? Believe me when I say they are a world apart in location.
Mike
17 Aug 2014, 06:10 PM
Did a search in Waikiki for properties with land over 800sqm in the $550-$600,000 price band. Nothing, not even a single storey at that price let alone very close to the beach.

Don't you hate when some one catches you out lying. Link to the listed property for sale? Even a street name will do.
http://www.realestate.com.au/property-house-wa-warnbro-117449671http://www.realestate.com.au/property-house-wa-warnbro-117449671
Edited by Jimbo, 17 Aug 2014, 06:14 PM.
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.
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Mike
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Jimbo
17 Aug 2014, 06:13 PM
That's the one I looked at. Now tell me, would you buy it for 389k knowing that for another 210k you could have the one on Fendham Street? Believe me when I say they are a world apart in location.

http://www.realestate.com.au/property-house-wa-warnbro-117449671http://www.realestate.com.au/property-house-wa-warnbro-117449671
It is listed for $620,000. It is not a 2 storey houses, it is 809sqm. It is far from luxury, looks rather dated to me in need of renovation or upgrade.

It certainly appears reasonable price, large land, close to beach, pool, good size house. No ducted air con or heating.

I find it very hard to believe your story about this house costing $1.2 million. I certainly have not offered $850k like you said you did. Around $600k seems a fair price for this house.
http://mike-globaleconomy.blogspot.com.au/
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Jimbo
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Mike
17 Aug 2014, 06:10 PM
Don't you hate when some one catches you out lying.
Tell me Mike, you must have a lot of experience.
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.
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ozz
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Mike
17 Aug 2014, 06:20 PM
It is listed for $620,000. It is not a 2 storey houses, it is 809sqm. It is far from luxury, looks rather dated to me in need of renovation or upgrade.

It certainly appears reasonable price, large land, close to beach, pool, good size house. No ducted air con or heating.

I find it very hard to believe your story about this house costing $1.2 million. I certainly have not offered $850k like you said you did. Around $600k seems a fair price for this house.
It clearly states from $599,000, can you agree with Jim here? 728 sqm as well, are you looking at the right one Mike?
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