Bardon You show you true colours by a statement like' laughing all the way to the bank'... such a sad thing you really must be.
Why not just state, 'I do not care about anybody buy myself and I certainly do not care about the following generation. I am here to make their life harder.'
Oh, and I suppose you are going to the bank to pay back those huge mortgages you have. Seems to me it could be the bank laughing at you buddy...
Tis the banks that are laughing all the way to the bank.
I call them banks, but at this stage they are more like oversized mortgage lenders for all intents and purposes.
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
I can understand alot of people comming out and talking about bubbles, what else can they as they watch Sydney house prices rise by 15-20% per year if not more.
Nothing else will help them, it does not matter about income growth, employment or the price of gold, none of that matters when prices are rising so quickly. So it is understandable. If I was in their situation I would be angry as well. But!
People like Shadow and others have warned people for years of what was to come, so they cannot say they did not know. Im talking to those who have bee watching the market some time and not those just entering. Those that believed the Bear hype that prices would fall up to 40% 5 years ago have lost a great deal. Not only in time (wasted years) but in lost oportunity and the satisifcation of owner you're own home. That is really sad and I mean that.
We all make choices in life, some good, some bad. Those that decided to wait the market out and kept waiting have been proved wrong. Sydney has been quiet for 10 years besides a brief period of activity. It was only a matter of time until prices expanded again. How high it goes, well no one really knows.
Based on track record though and expeirnece for being right, I would follow Shadows advice. He called it, prices would rise close to a median of $1,000,000 by 2015. He is getting close to that prediction now by the day.
Prices will have some sort of correction but when and how much is the key, what if Sydney keeps rising to $1,200,000 median and then falls by $200,000 to sit at $1,000,000 median.
I have my doubts about being able to sustain this high growth but the fundementals in Sydney still appear strong.
Lets even consider a worse case scenario. China has a large economic slowdown. The RBA would cut rates here further, Government would offer forms of stimulus and you could be sure wealthy Chinese would be pouring billions out of China by the day looking for somewhere to park it. Where do you think it will go.
The way I see this market is a fundemental change in our nation and the region. Huge wealth is being created in Asia by its 3 billion people, we are along for the ride and some of that wealth will come here. It may not be fair that overseas people can buy up property forcing up prices for locals, who ever said life was fair. Perhaps the government can implement some controls should this happen, I dont know.
What does concern me though is what happens in Sydney normally spreads to the rest of the capital cities over the following few years. Sydney might be able to sustain the current price growth, not sure though if it spread to other cities outside of melbourne.
Mike/aka Shoddy So you think house price inflation above wage growth is a good thing. That puts you on the 'Evil' side of the bunch mate....
Veritas
9 Sep 2014, 05:59 PM
Tis the banks that are laughing all the way to the bank.
I call them banks, but at this stage they are more like oversized mortgage lenders for all intents and purposes.
+1 and can imagine those profits as rates rise..... dear me, people are stupid. Seems to me, the banks have crafted it this way as they eat the people and destroy the real economy.
And they are the primary winners and driver in all if this. That aside, if you are the bank where do you go to to laugh?
"Laughing all the way to the bank, then realising the bank staff are actually laughing harder than you are, then wondering what the joke is... and whether they are laughing at you and your massive debt that they refer to as their asset and is paying their wages."
An extract from "The seven stages of enlightenment (A property investor's perspective)"
Mike/aka Shoddy So you think house price inflation above wage growth is a good thing. That puts you on the 'Evil' side of the bunch mate....
Can I ask who Shoddy is?
No I do not think growth above wages growth is good. However property prices never move in conjunction with wages growth. Im sure as you know the property market tends to move strongly for 2-3 years followed by years of little to no growth.
You miss a key feature though. Wages growth is only really relevant to those buying a first home. To some one who bought a property 10-20-30 years ago and has a mountain of equity wages growth is of little concern. The same for overseas investors and buyers, wages growth here is of 0 concern as the money was made and still being made outside of this nation.
Property prices can exceed wage growth for a very long time indeed and to only focus on this one area is narrow minded and short sighted. I do agree though it is a concern for young buyers, buying a first home who are watching prices rise much faster then wages or returns on savings or other forms of investment.
I can understand alot of people comming out and talking about bubbles, what else can they as they watch Sydney house prices rise by 15-20% per year if not more.
Nothing else will help them, it does not matter about income growth, employment or the price of gold, none of that matters when prices are rising so quickly. So it is understandable....
I couldn't put the case for an out of control bubble better!
You have summed it up beautifully.
WHAT WOULD EDDIE DO? MAAAATE! Share a cot with Milton?
Why, would anyone who understands economics not just get on with doing it. Unless of course they were a hanger oner trying to get a wealthy persons ear. There is nothing more ironic than some "professional" who "professes to understand economics" and still needs to pull a wage.
Still I understand that they are heroic to you.
ThePauk
9 Sep 2014, 05:59 PM
Bardon You show you true colours by a statement like' laughing all the way to the bank'... such a sad thing you really must be.
Why not just state, 'I do not care about anybody buy myself and I certainly do not care about the following generation. I am here to make their life harder.'
Oh, and I suppose you are going to the bank to pay back those huge mortgages you have. Seems to me it could be the bank laughing at you buddy...
Hey Puke I was responding to Veritas statement of "such a laugh", but I have learned that a post in is a bit deep for you, such a high level judgmental elder as you are.
I wont bother with little Chris yet, unless he becomes as senior as you.
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