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Affordable End Of Perth Market Leading The Charge; (only the cheap stuff is selling)
Topic Started: 8 Sep 2014, 01:57 AM (1,598 Views)
Drgonzo
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Jimbo
8 Sep 2014, 12:19 PM
You bought another investment property in Perth?

Fair enough...
no, the new one is in Adelaide, another place overflowing with affordable property and endless tenants to rent it.
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Jimbo
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Drgonzo
8 Sep 2014, 12:22 PM
no, the new one is in Adelaide, another place overflowing with affordable property and endless tenants to rent it.
Fair enough. Adelaide prices are something like what Perth prices should be.
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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szokolay
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Drgonzo
8 Sep 2014, 12:14 PM
Jimbo
8 Sep 2014, 12:12 PM
He thinks he has made 15%.

Like the bloke down the road from me who thinks he will get 580k for his house even after two weekends of home opens with zero attendance.
I have made 15%, the bank valued it for me last week which enabled me to secure another investment over the weekend.

The property is in Girro.

Making 15% on a sale and having a bank revalue your property 15% higher are 2 different things. It would not surprize me in the least if the valuations are swayed by how much equity you have in the property. 50%, 70% paid off, what does the bank care if they can get another loan off of someone and tie it to a home that has substantial equity in it.
Just sayin.
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Veritas
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Drgonzo
8 Sep 2014, 12:14 PM
I have made 15%, the bank valued it for me last week which enabled me to secure another investment over the weekend.

The property is in Girro.
:re:

Mate, tell us what you end up selling it for.

That is what it is worth.

Economics 101: A price is what someone is willing to pay.
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
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Jimbo
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szokolay
8 Sep 2014, 12:39 PM
Making 15% on a sale and having a bank revalue your property 15% higher are 2 different things. It would not surprize me in the least if the valuations are swayed by how much equity you have in the property. 50%, 70% paid off, what does the bank care if they can get another loan off of someone and tie it to a home that has substantial equity in it.
Just sayin.
I had a bank valuation done with a view to using part of my 100% equity to fund a business venture. The valuer was only in the house five minutes and his valuation came in around 5% over what I would market at.

That is the sole purpose of a bank valuation. They are only interested in knowing that the secured part of the loan is covered by the value of the asset. The greater the proportion of the value you are borrowing, the more critical the accuracy of the valuation is to the bank.
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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Drgonzo
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Jimbo
8 Sep 2014, 12:57 PM
I had a bank valuation done with a view to using part of my 100% equity to fund a business venture. The valuer was only in the house five minutes and his valuation came in around 5% over what I would market at.

That is the sole purpose of a bank valuation. They are only interested in knowing that the secured part of the loan is covered by the value of the asset. The greater the proportion of the value you are borrowing, the more critical the accuracy of the valuation is to the bank.
I paid 365 - I have access to ongoing recent sales data. Properties with same size land, same number of bedrooms, same condition even the same street are selling for 450.

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Bardon
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In my experience valuations come in low not high, especially when it is for refinancing purposes, I copped this a few months ago.

Another time in another place I had a vendor walk away from buying a house from me once because of this. As Peter says there are valuations and there are valuations. Its like tax law it isn't certain.
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Jimbo
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Drgonzo
8 Sep 2014, 01:05 PM
I paid 365 - I have access to ongoing recent sales data. Properties with same size land, same number of bedrooms, same condition even the same street are selling for 450.
There is still an investor feeding frenzy going on down Rockingham way. Cheap properties around the $350k mark are selling quickly and then you see them in the rental listings a month or so later.

Since early July, rental listings in the area have climbed from 67 to 94 with not one single week showing a fall in listings. I am also seeing asking rents being reduced as competition for renters hots up.

Meanwhile, houses over 500k are languishing on the market. The bloke down the road from me listed two weeks ago at $580k and after two weekends of home opens hasn't had a single viewing.

There is one new apartment development being built near the foreshore and I know the developer. He reckons around 60% of the off the plan sales were to investment buyers. That will be even more stock competing for renters when it is finished.
Bardon
8 Sep 2014, 01:11 PM
In my experience valuations come in low not high, especially when it is for refinancing purposes, I copped this a few months ago.

Another time in another place I had a vendor walk away from buying a house from me once because of this. As Peter says there are valuations and there are valuations. Its like tax law it isn't certain.
I suffered from this in the UK. I was selling in 2007 and the buyers tried to re-negotiate the price down by 15 grand because the bank valuer had come in under the agreed selling price (in the UK, offer and acceptance is not legally binding).

I had received three asking price offers on the property and chose to accept from the only buyers that had no chain (not relying on a their own sale).

We spent a week arguing the toss with them about the accuracy and purpose of bank valuations whilst at the same time we went back to market.

The buyers were furious when they found out we had re-advertised and wrote to the agent threatening breach of contract (which of course they couldn't enforce).

They ended up paying a grand for a full structural and valuation survey by a local building surveyor and paid the full asking price (as originally agreed).

The UK property market is a proper bastard and I have been mucked about so many times over there.

Edited by Jimbo, 8 Sep 2014, 01:49 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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zaph
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Bardon
8 Sep 2014, 01:11 PM
Another time in another place I had a vendor walk away from buying a house from me once because of this. As Peter says there are valuations and there are valuations. Its like tax law it isn't certain.
Quote:
 
In my experience valuations come in low not high, especially when it is for refinancing purposes, I copped this a few months ago.


Everything I've read from posters (here and other property forums) who actually have more than one experience of property valuers agrees. PIs with multiple properties being revalued, and mortgage brokers all agree that valuers are quite conservative, especially when it comes to refinancing.

Why would a valuer risk being sued for providing an absurdly high valuation when they receive their fee no matter what?
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Jimbo
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zaph
8 Sep 2014, 02:15 PM
Everything I've read from posters (here and other property forums) who actually have more than one experience of property valuers agrees. PIs with multiple properties being revalued, and mortgage brokers all agree that valuers are quite conservative, especially when it comes to refinancing.

Why would a valuer risk being sued for providing an absurdly high valuation when they receive their fee no matter what?
It depends what is at stake. In my case I was only looking to borrow 40% of the value of the property with the remainder being all equity.

The bank could only lose if the market corrected by more than 60%. I think the valuer just turned up to justify the fee. He didn't even look in the bedrooms.

In the UK when they were offering 100% LVR's they were very exacting. Mortgages would be offered with retentions for minor things like a bit of paint missing from a skirting or a dripping tap.

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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