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Why there will be no crash in Perth; Perth bears have their fantasy smashed
Topic Started: 21 Aug 2014, 02:38 AM (43,295 Views)
Jimbo
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26 Sep 2014, 01:25 AM
I can confidently say that a low-skilled job here can still give me a better living standard than working as an engineer over there. (Unless you run a business. Due to the low tax and very loose business environment, businesses usually brings you significant wealth)
I don't see how you feeling better off here than in Malaysia is going to drive house prices higher?

Can you afford to spend more on a house than an Australian earning the same money as you? Just because living standards are higher here, does that give you greater buying power?

I don't get your argument.


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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Sorry i didn't make it clear.

I think it could be an Asian thing, or maybe a Chinese thing.

Owning a home is something of very very high priority to us.

Look at the property market in Singapore, Hong Kong, China, Malaysia, Taiwan.
Look at the property market here in Australia.

Because we had higher difficulty-enduring threshold, it makes it feel much cheaper and much easier to live in Australia. So when we are given the opportunity to live here, we see properties as very affordable. Much more affordable compared to where we came from. We see that even working in a low-skilled job, it is still very affordable.

There are not many Asian families who rent (except for very fresh migrants)
They save up for their first home very quickly after arriving in Aus.

That is why I said that so long the migration door is still open, property prices will be supported.

China has 1b population.
If you count the Chinese in other countries, Taiwan, Malaysia, Singapore, Brunei, US, Aus, Europe etc, maybe we make up 1/3 of the world population. Probability tells you that you will get a large number of these people coming in.
Sorry to say this, but many of these people have much higher difficulty enduring ability. What you see as unaffordable, will be seen as affordable for them.


For eg, you think working 5hrs for a piece of bread which is selling for $5 a piece is the threshold.
When the price of bread goes up to $5.50 you feel that it's going to crash back down.

But the fact is that these hard working people feel that even at $10 it is ok.
Working 10hrs for a piece of bread is still ok.
So as long as the migration door is still open, they will come in, they will save up, they will buy.


That's why I keep stressing that the typical ups and downs are unavoidable, but a crash, I doubt.
Unless you shut the migration door entirely. Unless you don't allow students to stay back at all.
And guess how we chose which uni to go to and what course to do when we were in high school?
We would look at the migration rules. We would look at how we could be allowed to migrate overseas.
Choose the country, choose the uni, choose the course. That's how determined we are.


I remember these photos from auction related news - Sydney:
Posted Image
Posted Image

See the high number of Asians?

Go to schools like Rossmoyne SHS and Willetton SHS. See how many Asians there are. I remember seeing a young guy in a Rossmoyne SHS's leaver jumper, half the names on the back of the jumper were Asian names.


try another quick google. Google for "Asians are hardworking".
See how many results you get.

By saying all these I don't mean to bring up the race topic. What I am saying is a clear cultural difference.
We think renting long term is not acceptable. We think we have to work hard to achieve stability in life. We come from a place where there is no government support and social benefit.

Coming to a country where there's plenty of benefits, where when we work as hard as we did, we start to be able to save a lot more than we did.
What do we do with the savings? We invest.

Hope these posts give people a better understanding of us too.

And if you have not realised it, there are many racist people out there.
I would say all Asian migrants have faced racism of some sort. Even in this discussion I see a "plop cycle" popping up.
Why bring emotions into the discussion? =)

And of course if you have not realised yet, we are normally the type of people who accept, ignore, but we charge on with our plan, with determination.











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John Frum
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Jimbo
26 Sep 2014, 08:43 AM
I don't see how you feeling better off here than in Malaysia is going to drive house prices higher?

Can you afford to spend more on a house than an Australian earning the same money as you? Just because living standards are higher here, does that give you greater buying power?

I don't get your argument.

This is the classic supply and demand bubble justification trotted out at the barbecue: 'everyone wants to live here'.

An infantile argument that ignores every other supply and demand dynamic that sits above it.




Prop Cycle
26 Sep 2014, 10:04 AM
Sorry i didn't make it clear.

I think it could be an Asian thing, or maybe a Chinese thing.

Owning a home is something of very very high priority to us.

Look at the property market in Singapore, Hong Kong, China, Malaysia, Taiwan.
Look at the property market here in Australia.

Because we had higher difficulty-enduring threshold, it makes it feel much cheaper and much easier to live in Australia. So when we are given the opportunity to live here, we see properties as very affordable. Much more affordable compared to where we came from. We see that even working in a low-skilled job, it is still very affordable.

There are not many Asian families who rent (except for very fresh migrants)
They save up for their first home very quickly after arriving in Aus.

That is why I said that so long the migration door is still open, property prices will be supported.

China has 1b population.
If you count the Chinese in other countries, Taiwan, Malaysia, Singapore, Brunei, US, Aus, Europe etc, maybe we make up 1/3 of the world population. Probability tells you that you will get a large number of these people coming in.
Sorry to say this, but many of these people have much higher difficulty enduring ability. What you see as unaffordable, will be seen as affordable for them.


For eg, you think working 5hrs for a piece of bread which is selling for $5 a piece is the threshold.
When the price of bread goes up to $5.50 you feel that it's going to crash back down.

But the fact is that these hard working people feel that even at $10 it is ok.
Working 10hrs for a piece of bread is still ok.
So as long as the migration door is still open, they will come in, they will save up, they will buy.


That's why I keep stressing that the typical ups and downs are unavoidable, but a crash, I doubt.
Unless you shut the migration door entirely. Unless you don't allow students to stay back at all.
And guess how we chose which uni to go to and what course to do when we were in high school?
We would look at the migration rules. We would look at how we could be allowed to migrate overseas.
Choose the country, choose the uni, choose the course. That's how determined we are.


I remember these photos from auction related news - Sydney:
Posted Image
Posted Image

See the high number of Asians?

Go to schools like Rossmoyne SHS and Willetton SHS. See how many Asians there are. I remember seeing a young guy in a Rossmoyne SHS's leaver jumper, half the names on the back of the jumper were Asian names.


try another quick google. Google for "Asians are hardworking".
See how many results you get.

By saying all these I don't mean to bring up the race topic. What I am saying is a clear cultural difference.
We think renting long term is not acceptable. We think we have to work hard to achieve stability in life. We come from a place where there is no government support and social benefit.

Coming to a country where there's plenty of benefits, where when we work as hard as we did, we start to be able to save a lot more than we did.
What do we do with the savings? We invest.

Hope these posts give people a better understanding of us too.

And if you have not realised it, there are many racist people out there.
I would say all Asian migrants have faced racism of some sort. Even in this discussion I see a "plop cycle" popping up.
Why bring emotions into the discussion? =)

And of course if you have not realised yet, we are normally the type of people who accept, ignore, but we charge on with our plan, with determination.











The problem with the hardworking Chinaman yellow peril narrative that you're peddling is that it causes instability at the macro level when prices get too high.

There has to be a limit at which renting is going to be better than buying,

Why not try a little thought experiment - if price to income levels were 10 times what they are now and banks were offering multi-generational mortgages, would the appeal of the security of tenure mean you would put your offspring in hock to your financial decisions? Even if renting was talking a much smaller chunk of your income than servicing this mortgage?

Try to think outside the box.
Edited by John Frum, 26 Sep 2014, 10:46 AM.
"It were not best that we should all think alike; it is difference of opinion that makes horse races." - Mark Twain on why he avoids discussing house prices over at MacroBusiness.
"Buy land, they're not making any more of it." - Georgist Land Tax proponent Mark Twain laughing in his grave at humourless idiots like skamy that continually use this quip to justify housing bubbles.
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Prop Cycle
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Like i said before we have a different threshold limits.

Look at property prices in Asian countries.
Their cost / sqm and their property price to income ratio are both much higher.


When property prices in capital cities of Asian countries "crash" or come down in price, they don't even touch the the "peak" levels of Australia in terms of cost/sqm and price to income ratio.

What I am saying is, there is a lot of fat in the Australian market compared to where these migrants are from.

Cheaper cost/sqm.
Lower price to income ratio.
Lesser need to save up for education, healthcare etc etc.
Lower living expenses vs income ratio - vehicles, food, groceries etc
The conditions are all better in these aspects.

The same people who can support the property market in Asian countries under these tough conditions can more easily support the Australian property market when they come over.

That is why they will be adjustments / corrections / soft spots, but crash? not yet.

And of course that is also why banks are happy to lend 80% without LMI.
Because the risk of property prices going below 80% of the current day value in the short to medium term is rather low.



Don't get me wrong, I don't mean they will not come down in price. I'm not saying people will always make money in property. I dont mean it will always be going up up up. I'm not saying the demand to supply ratio will always be very high.
I'm just saying they will not crash based on the short to medium term conditions.

The average property price in Perth going below 80% of the current day value? The economy would have to be really really really, and I mean REALLY bad for that to come true.

10% lower in the next couple of years?
Possible, and maybe in some areas, probable.
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busted
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26 Sep 2014, 10:04 AM
Because we had higher difficulty-enduring threshold, it makes it feel much cheaper and much easier to live in Australia. So when we are given the opportunity to live here, we see properties as very affordable. Much more affordable compared to where we came from. We see that even working in a low-skilled job, it is still very affordable.

There are not many Asian families who rent (except for very fresh migrants)
They save up for their first home very quickly after arriving in Aus.

That is why I said that so long the migration door is still open, property prices will be supported.

Therefore I have some questions for you.

1, Where you came from? Shanghai, Beijing, Hongkong or other cities in China? You claim property in China is not as "affordable" as in Australia, then tell me why China's Home ownership rate is 90%(2012) while Australia is at 67%(2011). reference for you: http://en.wikipedia.org/wiki/List_of_countries_by_home_ownership_rate

2, There are way more Chinese migrants living in US, why couldn't they stop US property crashing while you think they would in Australia?

3, Chinese ppl can't even support their own domestic property market and it's crashing.

In plain English, you've overgeneralized Asian/Chinese ppl in property market. There are some of Chinese ppl property addicted just like the property spruikers in every ethnic group. You would find the same syndrome in the early migrants from Italy, Ireland and Greece years ago. Nothing different to Chinese/Asian.
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Massive
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Hard work on its own does not guarantee success ..
Basing predictions on Perth property market on racial stereotyping is not something i would consider prudent ..
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busted
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26 Sep 2014, 11:45 AM
Like i said before we have a different threshold limits.

Look at property prices in Asian countries.
Their cost / sqm and their property price to income ratio are both much higher.


I guess you are actually talking about a handful of Chinese cities, while ignored the whole picture. Moscow has a much higher property price than any Chinese city, can I make Russians more property addicted than Chinese?

Oh, don't forget China doesn't have property/land tax and the body corporate fee is much cheaper, that would bring the real cost of ownership down to certain point.
Prop Cycle
26 Sep 2014, 10:04 AM
try another quick google. Google for "Asians are hardworking".
See how many results you get.
I am a google user, but I am also see things with my own eyes. To my own experience, Asian, especially Chinese are not hard workers, but life wasters.

I've visited a major abattoir in Australia where about half of their workforce are Chinese on 457 visa. I found not even one Chinese worker in the position in dirty area, where the toughest, dirtiest and highest paid jobs are. Chinese workers in the factory are just long workers, who would like to work extra shift for extra money but don't want to try the hard job. That doesn't give them stronger buying power in property market.

Edited by busted, 26 Sep 2014, 12:18 PM.
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Massive
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Yes busted .. I've worked on mainland for over a decade ... The amount of time a project manager will say " but they worked really hard " as an acceptable cover for staff who turned in incoherent shit without listening to anything that was asked for is mind blowing ...

All emphasis on quantity and nothing on quality .. Clients will applaud u for turning in 300 pages of terrible , terrible work and assume u were lazy if submitted 20 pages of highly resolved and considered material that would serve them better .. Have to pad all ur work to make it look like staff didn't sleep all week to prove u are serious ...

Don't know how any of that provides a backbone to Perth market

I get much better work from my staff when I set objectives they must complete by 6pm on 1 or 2 solid ideas rather than the "working hard " method of making them work all night on 10 options that make no sense and will be thrown out the next day
Edited by Massive, 26 Sep 2014, 12:33 PM.
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busted
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Prop Cycle
26 Sep 2014, 10:04 AM
Coming to a country where there's plenty of benefits, where when we work as hard as we did, we start to be able to save a lot more than we did.
What do we do with the savings? We invest.











Where you mentioned "We invest", I take "we" as Chinese property speculators and "invest" as common speculation.

Why?

1, Not all Chinese are speculators. Even in China, property speculators are losing ground as we speak.

2, Like you said, low skill Chinese workers don't have time, info and skills to play in other higher return productive investment, but the old school housing market a dummy can play. And here you go, a bubble creation.

3, Like your photo suggested, the high congregation of Chinese buyer/owner means they were bidding against each other. A good invest would avoid this bad competition and choose their rivals wisely.
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newjez
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26 Sep 2014, 11:45 AM
Like i said before we have a different threshold limits.

Look at property prices in Asian countries.
Their cost / sqm and their property price to income ratio are both much higher.


When property prices in capital cities of Asian countries "crash" or come down in price, they don't even touch the the "peak" levels of Australia in terms of cost/sqm and price to income ratio.

What I am saying is, there is a lot of fat in the Australian market compared to where these migrants are from.

Cheaper cost/sqm.
Lower price to income ratio.
Lesser need to save up for education, healthcare etc etc.
Lower living expenses vs income ratio - vehicles, food, groceries etc
The conditions are all better in these aspects.

The same people who can support the property market in Asian countries under these tough conditions can more easily support the Australian property market when they come over.

That is why they will be adjustments / corrections / soft spots, but crash? not yet.

And of course that is also why banks are happy to lend 80% without LMI.
Because the risk of property prices going below 80% of the current day value in the short to medium term is rather low.



Don't get me wrong, I don't mean they will not come down in price. I'm not saying people will always make money in property. I dont mean it will always be going up up up. I'm not saying the demand to supply ratio will always be very high.
I'm just saying they will not crash based on the short to medium term conditions.

The average property price in Perth going below 80% of the current day value? The economy would have to be really really really, and I mean REALLY bad for that to come true.

10% lower in the next couple of years?
Possible, and maybe in some areas, probable.
Why do you assume Asian people are stupid?
Whenever you have an argument with someone, there comes a moment where you must ask yourself, whatever your political persuasion, 'am I the Nazi?'
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