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Who Benefits from High House Prices?
Topic Started: 24 Aug 2015, 06:52 PM (6,603 Views)
Hmmm
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ThePauk
26 Aug 2015, 11:04 AM
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Hmmmm..... your chart says home ownership was 68% in 1976 and is 67% now, so virtually zero change in 40 years!
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Hankook
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Hmmm
26 Aug 2015, 11:21 AM
Hmmmm..... your chart says home ownership was 68% in 1976 and is 67% now, so virtually zero change in 40 years!
Lol the Bears on here have no idea. Most don't care about the younger generation getting into the market. They just want the market to crash so they can get a bargain and to laugh at the people purchased long ago who they have been jealous of.
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ThePauk
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Hankook
26 Aug 2015, 11:30 AM
Lol the Bears on here have no idea. Most don't care about the younger generation getting into the market. They just want the market to crash so they can get a bargain and to laugh at the people purchased long ago who they have been jealous of.
'Most'...thanks...
And I suppose that means that 'some' bulls just want higher house prices to stop younger generations getting a home.

Hankook. Look at the ages in the chart, that is the point. Using the overall average is the same smoke and mirrors that Shads is using...
Edited by ThePauk, 26 Aug 2015, 11:45 AM.
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Hankook
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ThePauk
26 Aug 2015, 11:41 AM
'Most'...thanks...
And I suppose that means that 'some' bulls just want higher house prices to stop younger generations getting a home.

Hankook. Look at the ages in the chart, that is the point. Using the overall average is the same smoke and mirrors that Shads is using...
And how does it affect you that kids will be living at home a little longer?
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Chris
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Shadow
26 Aug 2015, 11:10 AM
Probably.

My position is pretty clear.

Australia's house price to income ratio hasn't changed much for over a decade, and is currently still close to its 2003 level (slightly above, but not by much).
But this position ignores the demigraphical shift of wealth to the older generation, it makes a mockery of your claims that house hold incomes to price ratios have remained the same because it it ignores the fundamental changes behind that average.

I was going to read your posts but it's a waste of time. This answer tells me that you know the data you have presented and your stance on the matter is deliberately deceptive.

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Car tart
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Chris
26 Aug 2015, 12:34 PM
But this position ignores the demigraphical shift of wealth to the older generation, it makes a mockery of your claims that house hold incomes to price ratios have remained the same because it it ignores the fundamental changes behind that average.


And your position ignores the demographic shift of
School leaving age,
age married,
Age moving out of parents home
People living longer
People stay longer in their own homes both as a young adult and into their more senior years
The constitution of a family has changed. Where perhaps 20% of people aged 20 - death were single in the 60s, today the figure is likely to be much higher requiring 2 homes to service the previous couple.
The citification of Australia where large number of people who lived in very cheap country homes have moved to the cities and thus could not afford a property to buy in the city.

Having been in the Real Estate Industry since 1979, I have heard every generation including mine say that it was much easier before than now.

But I do see a major problem occurring:

The concern will be in the inheritances of houses in the next few generations, I give an example below, of what could happen

My grandmother died and left enough for her 3 kids to buy another investment property.
My father now 84, owns 3 investment properties which assumedly will pass on one to each of his three kids. who own 6-10 homes each.
I would pass on what may be the equivalent to 12 homes in 30 years time and my ex will assumedly pass on a similar number to our 4 kids.
Our 4 kids 3 of whom own 2-4 houses would add a portfolio of some 6 properties each to the many houses they will own in the future.

Extrapolate this over another 3-4 generations and you will see why old landed gentry and families in many of the old countries have accumulated such wealth. It is time in the market.

And the problem will be far worse much quicker in future as the inheritance will no longer be split in 5-9 ways as people are having less kids, with the average family now being about 2 kids. The dilution of wealth will not be a problem.

So forget about your kids, worry about their great grand kids.

Quite simply we are all saving too much.
You cant drive a house, BUT you can always sleep in a car!
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Chris
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Car tart
26 Aug 2015, 01:06 PM
And your position ignores the demographic shift of

Having been in the Real Estate Industry since 1979, I have heard every generation including mine say that it was much easier before than now.

But I do see a major problem occurring:
My grandmother died and left enough for her 3 kids to buy another investment property.
My father now 84, owns 3 investment properties which assumedly will pass on one to each of his three kids. who own 6-10 homes each.
I would pass on what may be the equivalent to 12 homes in 30 years time and my ex will assumedly pass on a similar number to our 4 kids.
Our 4 kids 3 of whom own 2-4 houses would add a portfolio of some 6 properties each to the many houses they will own in the future.

Extrapolate this over another 3-4 generations and you will see why old landed gentry and families in many of the old countries have accumulated such wealth. It is time in the market.

And the problem will be far worse much quicker in future as the inheritance will no longer be split in 5-9 ways as people are having less kids, with the average family now being about 2 kids. The dilution of wealth will not be a problem.

So forget about your kids, worry about their great grand kids.

Quite simply we are all saving too much.
You pretty much made my case for me, and I haven't ignored anything.

I think you are ignorant to believe children are staying at home into adult hood for any reason other than their need too. Children are staying home to save deposits to buy homes, most now using the NG party trick to buy more than one.

This is an accumulative problem from previous generations and as you have pointed out it just gets worse and worse until eventually people are waiting a whole lifetime for parents/grandparents to die until they can afford their own home. All of which goes to provide greater evidence that the crucial 24-35 age bracket are being locked out of housing for decades longer, potentially forever.

Thanks for bolstering my case.
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Car tart
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Chris
26 Aug 2015, 01:22 PM
I haven't ignored anything.


The definition of ignorance is saying "I haven't ignored anything"

Selectively cutting and pasting someone elses work is worse than ignorance, You have ignored the extra points and chosen to put in part my diatribe on inherited wealth over the long term as it does imply that your great great grandkids may not be able to live comfortably, without some inheritance or wealth being passed on.

Edited by Car tart, 26 Aug 2015, 01:36 PM.
You cant drive a house, BUT you can always sleep in a car!
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Shadow
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Chris
26 Aug 2015, 12:34 PM
this position ignores the demigraphical shift of wealth to the older generation
Wealth has always shifted towards the older generations. Younger generations have always been less wealthy than older generations.

But don't worry. In time the older generations will die and the younger generations will grow old and wealthy themselves. That's just how life works.

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it makes a mockery of your claims that house hold incomes to price ratios have remained the same
No it doesn't. House price to income ratios have remained fairly constant since 2003. This is a fact.
Edited by Shadow, 26 Aug 2015, 01:39 PM.
1. Epic Fail! Steve Keen's Bad Calls and Predictions.
2. Residential property loans regulated by NCCP Act. Banks can't margin call unless borrower defaults.
3. Housing is second highest taxed sector of Australian Economy. Renters subsidised by highly taxed homeowners.
4. Ongoing improvement in housing affordability. Australian household formation faster than population growth since 1960s.
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GloomBoomDoom
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Shadow
26 Aug 2015, 01:38 PM
House price to income ratios have remained fairly constant since 2003. This is a fact.
What where they between 1983-1993 and also 1993-2003?
MSE
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