Australian housing Ponzi prepares for implosion. Two million could people default in months.; More than 2 million Aussies at risk of default in next twelve months
Tweet Topic Started: 5 Oct 2014, 09:48 PM (4,315 Views)
Hi, I am in Perth Western Australia. I can answer your question very easily, 2 people working on the mines, great income stream. Clunk, one job lost. Tighten the belts. Heaven forbid the other person losses their job. I am seeing so many empty apartments here in Perth. Agents are telling me that the prices have dropped 10% at least. Home opens are a very quiet event. A friend of mine is looking for a 2 bedroom villa or duplex and we have been going to home opens. It is not uncommon to be the only people there and more often than not the home is empty. I got exited yesterday when the villa was tenanted, only to be told that the tenant was leaving in 2 weeks time. Get it very straight the market has changed in Perth. I would be very reluctant to buy anything at the moment. I have a feeling the government may have to bring in a beefed up FHO program for established properties. Peter By the way my friend was telling me 2 months ago that properties where still going up, yesterday the 2 agents representing the villa in unison explained that the price had been reduced in an attempt to secure a sale. BUYER BEWARE
I have to agree with you on that one. Perth is collapsing so bad this year. I mean, I've never seen it so bad in 15 years.
We are currently offering 2 months free rent at current rates if people sign up for 12 months.
I did advise a few people to get out of the market start of the year. Some did and some didnt saying 'capital growth will save me'
I told them they will lose about 2% per 1/4 this year but they didnt believe me on top of the vacancy rate double/tripling.
Now its happened and the ones that sold are sitting on 100k more than the ones that didnt. The worst one I have is a property thats been empty for 3 months now because no one will rent it. I've dropped the price 30% and still nothing. Its better to lose 30k in stamp duty than 100k in capital growth.
I feel bad for the people who genuinely need to sell. The owner occupiers who need an extra room or need another toilet. They are the ones really getting shafted by this bubble and will be left holding the ball. If it gets any worst investors will simply sell and move onto the next big thing and leave the people who cant sell holding the ball and paying off all the capital growth they have extracted.
Some previous stats have counted house price increases as savings in their figures, even though people have ACTUALLY SAVED NOTHING at ALL.
I also find it hard to believe when we know most are now paying Interest only loans, not only investors, but people upgrading and also first home buyers.
How can you be ahead when your only paying interest only loans..I can Imagine that many actually paying down debt may be ahead with these low rates, but they seem to be the minority today. The scam now is to put down nothing and pay off nothing and borrow as much as possible with rates at record lows while the economy around us crumbles. Then hope for the best.
The government and banks have now robbed the future of our economy through complete ignorance and greed. Such an arrogant and short sighted measure of greed, without realizing they are not only shooting themselves in the foot , but guaranteeing the future here will be bleak for our economy for a very long time.
But what do you expect when your country is run by dopes who were never good enough to make it in the real economic world, and seem only too happy to destroy and degrade our lovely country.
Precisely my point, data can be used to tell any story you want it to.
Precisely my point, data can be used to tell any story you want it to.
So What? Only one thing will happen. If you use data to try to sell a story you are fooling yourself as well as (perhaps) a few other people. In this case any dishonesty carries its own punishment.
The truth will set you free. But first, it will piss you off. --Gloria Steinem AREPS™
The article is about people at risk of default - in fact it's nothing to do with home loan repayments.
You are off at a tangent to the data in the article.
Pete, isn't that just robbing Peter to pay Paul sort of stuff. My mortgage is inline but I neglect everything else and had credit cards bouncing of the limit and late payment invoices for utilities jamming up my letterbox.
Isn't this how america went to shit, people paid the mortgage and the credit card was for bills and living expenses until the credit limit increases stopped.
I think your missing the bigger picture, aren't you?!
Pete, isn't that just robbing Peter to pay Paul sort of stuff. My mortgage is inline but I neglect everything else and had credit cards bouncing of the limit and late payment invoices for utilities jamming up my letterbox.
Isn't this how america went to shit, people paid the mortgage and the credit card was for bills and living expenses until the credit limit increases stopped.
I think your missing the bigger picture, aren't you?!
Unless I missed it when I originally read the article I don't believe the article is about home owners, it's about people who are at risk of defaults. Most defaults are actually for small payments like a phone bill, car payments, credit card payments etc. Of course that could include home loan repayments for some people.
I think that the assumption that the article is about home owners is probably a huge misinterpretation of the facts. Had Veda came out and declared that they meant home loan payments then I would agree with you, but they didn't.
Veda have little trouble distinguishing a home loan default from other small defaults, in fact their data integrity would be pretty impressive.
This appears to be the Veda report the story is based on. I can't locate any other recent media reports on this.
Unless I missed it when I originally read the article I don't believe the article is about home owners, it's about people who are at risk of defaults. Most defaults are actually for small payments like a phone bill, car payments, credit card payments etc. Of course that could include home loan repayments for some people.
I think that the assumption that the article is about home owners is probably a huge misinterpretation of the facts. Had Veda came out and declared that they meant home loan payments then I would agree with you, but they didn't.
Veda have little trouble distinguishing a home loan default from other small defaults, in fact their data integrity would be pretty impressive.
This appears to be the Veda report the story is based on. I can't locate any other recent media reports on this.
Small bills and credit cards are being defaulted on because household funds are going into the mortgage. What we need to know is how many if these people at risk of default have mortgages.
If a large percentage do then it would reaffirm my assertion that they are paying the mortgage but defaulting on associated cost and living off credit cards which they are also defaulting on.
Small bills and credit cards are being defaulted on because household funds are going into the mortgage. What we need to know is how many if these people at risk of default have mortgages.
If a large percentage do then it would reaffirm my assertion that they are paying the mortgage but defaulting on associated cost and living off credit cards which they are also defaulting on.
About half of home owners who occupy houses must meet home loan repayments, and almost every non home owner who occupies a house has to pay rent.
Any expressed market opinion is my own and is not to be taken as financial advice
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