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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 (89,613 Views)
Perthite
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Drgonzo
8 Nov 2014, 07:59 PM
In wa I think there will be but it doesn't keep me awake at night given the size if my investment, if anything a downturn will see more demand for affordable prooerty.

I've been saying for some time that a broader down turn is coming which has been apparent with the government spending record amounts on infrastructure particularly on the east coast, anyone in the civil game will tell you it's boom time which is reflected in the share price of key players like Lend Lease which has practically doubled in value in two years.
I guess if your long term.
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TheTruth
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Jimbo
8 Nov 2014, 07:07 PM
Also, Adelaide did not experience a once in a lifetime rapid expansion in its mining and oil and gas infrastructure with record wages being paid to anyone who could hold a shovel.
Nope you are dead wrong.

Adelaide didn't boom as hard due to a smaller resources base and an even smaller minded government, but it certainly had the same rapid prices increases 2003 - 2007.

Anyway, you are arguing a different point. I asked why it hasn't crashed not why it hasn't boomed as much.
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bundy
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Please look at these charts and then tell me that a given city/state didn't boom as much.

http://www.whocrashedtheeconomy.com.au/blog/2014/09/housing-ratios-state-by-state/
Edited by bundy, 9 Nov 2014, 01:42 AM.
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KaiserSauzee
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I almost bought land/property in Baldivis earlier this year, but due to the mining downturn I got made redundant right at the critical moment so mortgage fell through!

Anyway, not too concerned as I am now watching property values drop

One house I am using to gauge the market is in the next street along from me in Tapping

It was rented out for a few years, most recently by a NZ family who broke the lease and buggered off back to Kiwiland as they didn't like Perth, too expensive

I know that the rent was $550 per week as my mate tried to rent it at one point

Interestingly, when he tried to rent it appx 2 years ago, there was around 20 people at the home open, the 2 x subsequent times it was rented the tenants simply moved in, no queues of people like before

Around 8 months ago it was put on the market at offers over 575k

Then they had a home open and not one single person appeared

Around 6 months ago the price dropped to offers over 540k

Still no takers

Last month they dropped the asking price to offers over 500k

Still sitting there................

(Oh and I'm pretty sure the ad on right move states that they will consider renting as opposed to buying, for around $480 per week)
Personally I reckon the house prices in Perth will take a big hit

The majority of people who are here from other countries or eastern states will be gone like a flash the minute the work dries up, and it is drying up

But land is still being released and house still being built, which will mean more properties on the market and not a lot of people buying

The exact opposite of the conditions that seen property values rocket over the past decade or so

Taking the house I used as an example above, someone somewhere is paying that mortgage, but it has no tenants and is struggling to sell

Sooner or later the owner will either have to cut down another $50k or more to sell, or possibly go bankrupt


Edited by KaiserSauzee, 9 Nov 2014, 02:02 AM.
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Foxy
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Zero is coming...

KaiserSauzee
9 Nov 2014, 01:52 AM
I almost bought land/property in Baldivis earlier this year, but due to the mining downturn I got made redundant right at the critical moment so mortgage fell through!

Anyway, not too concerned as I am now watching property values drop

One house I am using to gauge the market is in the next street along from me in Tapping

It was rented out for a few years, most recently by a NZ family who broke the lease and buggered off back to Kiwiland as they didn't like Perth, too expensive

I know that the rent was $550 per week as my mate tried to rent it at one point

Interestingly, when he tried to rent it appx 2 years ago, there was around 20 people at the home open, the 2 x subsequent times it was rented the tenants simply moved in, no queues of people like before

Around 8 months ago it was put on the market at offers over 575k

Then they had a home open and not one single person appeared

Around 6 months ago the price dropped to offers over 540k

Still no takers

Last month they dropped the asking price to offers over 500k

Still sitting there................

(Oh and I'm pretty sure the ad on right move states that they will consider renting as opposed to buying, for around $480 per week)
Personally I reckon the house prices in Perth will take a big hit

The majority of people who are here from other countries or eastern states will be gone like a flash the minute the work dries up, and it is drying up

But land is still being released and house still being built, which will mean more properties on the market and not a lot of people buying

The exact opposite of the conditions that seen property values rocket over the past decade or so

Taking the house I used as an example above, someone somewhere is paying that mortgage, but it has no tenants and is struggling to sell

Sooner or later the owner will either have to cut down another $50k or more to sell, or possibly go bankrupt


The key is supply and demand.

Prices really have only one way to go if demand drops.

So lets see what happens.

peter

http://www.afr.com/content/dam/images/g/n/2/1/u/8/image.imgtype.afrArticleInline.620x0.png/1456285515560.png
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KaiserSauzee
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Mustapha Mond
9 Nov 2014, 02:04 AM
The key is supply and demand.

Prices really have only one way to go if demand drops.

So lets see what happens.

peter
I agree

For what its worth, I reckon that I could now get a house in tapping for the same price it was going to cost to build (460k wish) in Baldivis

In reckon (as happened in the UK and Ireland) the first places to be hit will be the further out suburbs, like Alkimos, Yachep, Armadale, Valdivia etc etc mainly due to my point above about houses being in closer areas to the city becoming more affordable


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Foxy
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Zero is coming...

I think you may be correct.
The mineral boom is over.
The crazy demand is over.
So the high prices should slowly drift down.
Remember if we have inflation of 3% then even if property stays at the same price then it is dropping in real terms.
Peter
http://www.afr.com/content/dam/images/g/n/2/1/u/8/image.imgtype.afrArticleInline.620x0.png/1456285515560.png
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Petes
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Mustapha Mond
9 Nov 2014, 02:54 AM
I think you may be correct.
The mineral boom is over.
The crazy demand is over.
So the high prices should slowly drift down.
Remember if we have inflation of 3% then even if property stays at the same price then it is dropping in real terms.
Peter
I really really never understand australia.

So I've been working 7 years now.

I never bought a house

Instead I put all my savings into managed funds with 80% in high growth and 20% in core. With a 50% 50 split on international v australian.

So far ive made back almost 15% yoy

I have 750k... 750 fkn K

And I'm not 30.

I'm on 90k a year now. I was putting away 40-50k a year.

I mean. Why would ANYONE buy property in Australia. Let alone Perth!

I'll be a millionaire by the time I'm 32.

And that's clear. Not 'I have a million in loans and property' BS

I see Perth rents falling vacancy rising heaps of people losing jobs house and unit prics falling 20-30% and I think fk that... a negative yielding property and negative capital growth.

Perth is such a stupid investment only morons think it's good. Why would anyone want to buy a place that 'breaks even' lol or 'just pays for itself'

I mean seriously 750k. I can buy a house outright. I don't even need to work anymore.

I'm in the process of moving to 75% international 25% australian because I believe without government intervention and stimulus australia has had its run. It's peaked right off. I'm moving to Asian investment :D

I'd suggest you all do the same.

Anyhow just my 2 cents to anyone who thinks perth property is the way to riches. Lol
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TheTruth
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bundy
9 Nov 2014, 01:41 AM
Please look at these charts and then tell me that a given city/state didn't boom as much.

http://www.whocrashedtheeconomy.com.au/blog/2014/09/housing-ratios-state-by-state/
All you did was prove me right.

all major cities boomed in the early to mid 2000's, then had a minor drop off with the GFC but no crash.

So i'll ask you again very clearly - If a major down turn in mining is going to wipe out Perth, why hasn't Adelaide been wiped out?

There are a lot of parallels there you can't deny. A quick search through the forum shows a lot of posts from the time OD was canned doing it.
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ozz
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KaiserSauzee
9 Nov 2014, 01:52 AM
I almost bought land/property in Baldivis earlier this year, but due to the mining downturn I got made redundant right at the critical moment so mortgage fell through!

Anyway, not too concerned as I am now watching property values drop

One house I am using to gauge the market is in the next street along from me in Tapping

It was rented out for a few years, most recently by a NZ family who broke the lease and buggered off back to Kiwiland as they didn't like Perth, too expensive

I know that the rent was $550 per week as my mate tried to rent it at one point

Interestingly, when he tried to rent it appx 2 years ago, there was around 20 people at the home open, the 2 x subsequent times it was rented the tenants simply moved in, no queues of people like before

Around 8 months ago it was put on the market at offers over 575k

Then they had a home open and not one single person appeared

Around 6 months ago the price dropped to offers over 540k

Still no takers

Last month they dropped the asking price to offers over 500k

Still sitting there................

(Oh and I'm pretty sure the ad on right move states that they will consider renting as opposed to buying, for around $480 per week)
Personally I reckon the house prices in Perth will take a big hit

The majority of people who are here from other countries or eastern states will be gone like a flash the minute the work dries up, and it is drying up

But land is still being released and house still being built, which will mean more properties on the market and not a lot of people buying

The exact opposite of the conditions that seen property values rocket over the past decade or so

Taking the house I used as an example above, someone somewhere is paying that mortgage, but it has no tenants and is struggling to sell

Sooner or later the owner will either have to cut down another $50k or more to sell, or possibly go bankrupt


I've got a sub-divided block of land I'm looking at in Perth now. Originally mid $300K+, now low to mid $300K. I'm pretty sure it will be on the market for a while, and I reckon I'll eventually pick it up for $290K. I've got time, and the market, especially land (which goes down first) will start to come off pretty strong next year.

I'll keep APF informed to track this and see if my assumption comes true.
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