It's not going to happen. It has never happened, and never will.
Never hey, that might come back to bite you.
You're assertion that gaining a decision to foreclose in the supreme court would be onerous on the banks is ridiculous. Most applications take minutes at most, the banks routinely do thousands of them every year.
The other assertion you make is that because it has never happened on mass before then it will never happen, not a water tight arguemrnt is it. As a mortgage lender If I saw a falling market the difference between my declining asset being 10% behind or 40% behind could be my ability to move in on and foreclose loans as the market declines. I can't imagine any bank would allow massive losses to mount on an expanding books.
House price declines will have a natural progression into job losses given the economy is solely driven by mindless construction. Banks would know that defaults would rise strongly in a very short period, why would they expose themselves to defaulting clients who's loans are also underwater?
Think about it shads, also clarify whether NE is defined as a form of default in the NCCP act, you haven't been clear on that.
No worries Chris. We'll just have to agree to disagree. I can't be bothered going through the whole debate again. Go read the 200 page thread if you're interested. Your questions are all covered there.
As a mortgage lender If I saw a falling market the difference between my declining asset being 10% behind or 40% behind could be my ability to move in on and foreclose loans as the market declines. I can't imagine any bank would allow massive losses to mount on an expanding books.
spot on, thats exactly what happened in the gold coast after 2008 when house prices collapsed 30 pc
as soon as prices were down 10 pc in 2009 thats when the banks pounced, all the property investors and home owners got repossessed, thousands of them, which is lucky for the banks because they were protected then when prices fell another 20 pc on average and up to 50 pc in some developments
its also been happening in mining towns like moron-bah and die-sart where prices are down 50-60 pc
smart play by the banks and tough luck to all those dumb investah's and home owners who got kicked to the kerb, I mean what bank would allow massive losses to mount on an expanding books, i can't imagine them doing anything else other than what they did
it was in all the papers at the time, lots of whinging homeowners complaining about the banks booting them out
i say tough luck suckers the banks can and will do whatever they want and your stupid nccp act is no help when the bank plays hard ball
oh wait, none of that happened, it was just a bears wet dream, GC houses did crash 30 pc, moron-bah did crash 50 pc, but nobody got repossessed because of it
You said something pretty ridiculous (the tree thing) given where you are fundamentally coming from regarding desiring home ownership John, and I called you on it.
Why was that ridiculous? I'm trying to point out that there are unforeseen one-off costs incurred with ownership that can take a big bite out of both your time and/or your profits. I saw relatives lose the equivalent of over 2 years of rental income on a an investment apartment due to the discovery of concrete cancer.
As a renter I deal with none of this - my costs are constant (bar inflationary rises), and the stress factor involved in repairs is minimal - I just ring one of the minions at the agency and they send out a repairman. I like this arrangement, not only are we managing to save a hefty sum compared to if we had purchased, but I also get to live in an area that has good schools, shops and a short commute.
To me the idea of bidding away with other fools at an auction right now to pay 1.6 million for a property I'm currently paying $700 a week to rent in is nothing short of suicide. But my opinion is starting to turn with this approaching correction.
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With you apparently not appreciating being called on it? - To the extent where you go looking for me re supposed frustration and hypocrisy on my part.
I don't care if you call me out on this, or anything else for that matter. You can sling as much shit at me as you like Herbie. I like it when people sling shit at me here (although Trollie gets blocked for being too repetitive), it usually means they're speaking something close to the truth. It's why I hang out here and not at Macrobusiness.
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The supposed hypocrisy re Socialism - I see no fundamental conflict in recognising that while there are genuine cases out there who need a helping hand to get by (which I'm very happy to see given to them) that Socialists are just effing idiots to pay so little attention to the fact that it does seem to be a pretty inherent part of human nature to want to improve one's lot financially; And as such, for them to not realise that Socialism is fundamentally at odds with something that is an inherent part of human nature; And that we'd be effing idiots as well if we didn't recognise that to the extent Socialists just might be successful in implementing full on Socialism, what they really are being successful in is creating an ever increasing bunch of bludging free loaders. With that in itself inevitably sowing the seeds for the destruction of their beloved egalitarian Socialist system.
My prerogative is similar, but where I differ is that I don't believe that there's only 'one' natural form of rule that us humans were born to live by. Like your beloved property market I believe it's cyclical and driven by circumstance - sometimes we need tyrannical rule, and sometimes we need to be a bit more bolshy. Right now we're faced with a creed (Capitalism) that promised (and almost delivered) utopia by urging us to empower the individual's selfish urges, but whose legacy is now piles of debt and growing inequality.
Typecasting people who look to more Socialist ideas as whiny self-entitled losers is just smoke and mirrors - every social group has laggards that don't pull their weight. I could go on but it's late and I'm not feeling clever enough to write any more on this subject without it sounding like waffle.
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As to the supposed hypocrisy re Georgism (and that Aussie dill David Collyer who promotes it) the story is pretty much ditto as above for Socialism - In that Henry George possibly failed to understand the immense obstacles to implementing a system that was fundamental at odds with what would seem to have historically and currently still be, a pretty natural human desire to acquire land and resources and profit from the ownership thereof. Though in fairness to George, whilst being NO expert on it myself, I suspect he was probably much more after 'the land barons' of his day as opposed to 'the homesteaders' of his day? But silly bloody Collyer's even got the knife into the average basic Joe Six Pack 'homesteader' of our modern era. And wants to tax him to death TOO! So he's a VERY unrealistic dill. And gets what he deserves - For mine - With that being pretty much squat to date at least apparently!?!
I see where you're coming from Herbie, but I'm afraid your home-cooked brand of libertarianism is to me just old fashioned rent seeking dressed in a cheap suit - land has, and always will belong to everyone. Sure, it's complicated, we all have a need for stability and security, and divvying it up is still prone to the same problems of corruption and cronyism, but the whole idea of land ownership to me is just fucking daft if you have any belief in equal opportunity (which you imply you do Herbie). Ownership over time just creates unimaginative, rentier dynasties.
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Now my fundamental approach tends to be to say Yes, the desires to get ahead financially and acquire land and resources, are so ingrained in most people anyway (hopefully anyway!!! - with the alternative of them not being so, not sounding especially attractive to me at all) that we best just accept this is so and develop systems that recognise and support these desires, rather than fight them - If we want to have systems that just might have some sort of chance of being successful long term.
How will a Georgist style land tax make this not possible? The best and most productive workers will still get the best pieces of land to live on and bring up a family - but if their kid ends up a junkie dropkick, he'll more than likely have to make do with a more modest plot when his folks die.
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And in having said that, as you seem SO keen to nail me for some sort of fundamental 'HYPOCRISY', you VERY well could be in with a shot (or three) - Because while I incline to supporting systems that recognise the inherent desires of humans to get ahead financially/acquire land and resources for the benefit of them and theirs blah, blah, because these seem to be pretty natural things to want to do (from my observations anyway): * Potential Shot A: I'm NOT inclined to support systems that actively encourage people to become bludging layabouts - Despite the fact it could be argued a desire to become a bludging layabout just could be pretty inherent part of human nature ALSO maybe? and
* Potential Shot B: It can pretty easily be turned around to say that in wanting to acquire land and resources from which one can profit, one is just displaying their natural tendency to want to become a bludging layabout anyway - Which is something I've previously said (or at least strongly implied?) I DON'T support perhaps? and
* Potential Shot C: If you can't dream up AT LEAST ONE of your own, I'll be quite disappointed in you John ...
I understand these desires, and I understand that people with ambition and chutzpah are essential for the survival of the species. I just think we have too many of them at the moment.
I think it was Elastic that posted an amusing property investor analogy a while ago with cavemen, and how there were some who were brave and courageous enough to go venture outside of the cave and fight predators, and these were the guys who got laid and had more kids to spread that dominant gene. But society evolved over time so that eventually the brave guys came to be seen as having a nasty self-destructive streak, which needed to be tempered with the insights of the cautious guys who were more introspective and thoughtful, prehistoric Bill Gates' who could come up with better weapons or shelter structures.
To me at this moment in time Australia need a lot more of the latter.
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So finally, to the "frustrated" 'accusation' - Well as it happens, I'm pretty content. In most ways anyway Ta. And in any ways I'm not, I very much doubt you have the ability or capacity to assist me in becoming more content - So don't see any point telling you all my supposed little 'issues and problems'. Though will admit, some pretty strange things DO seem to be being proposed by some pretty strange people in the world these days. But with me saying Oh well, it will be what it be and I'm pretty bloody confident I'll make the bloody best of it regardless - And if I bloody don't, then on my own bloody head be it!
I was just winding you up Herbie - let's face it, anyone who posts here is fucking odd and frustrated in some way. Although some (like socks borne out of failed market calls like Pig Iron-->Trollie) more extreme and sad than others.
"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.
No worries Chris. We'll just have to agree to disagree. I can't be bothered going through the whole debate again. Go read the 200 page thread if you're interested. Your questions are all covered there.
No Chris, just ask the treasury department. Shadow is a deluded guy who can't accept his investment strategy has some risk.
He thinks he has a guaranteed government backed path to riches lol.
Banks don't want to margin call home loans anyway. If the owner is making the payments according to the agreed schedule, there is zero benefit to them in potentially foreclosing the loan. Why would they want a bunch of properties that they have to move at firesale prices, losing a bunch of time and money in the process, when they can simply let the owners continue to pay.
There will always be some outlier examples of where the properties fall massively (e.g. Miningsville in West Bumroot), but the majority of IPs that were viable enough to be financed in the first place can continue to run for years, even if 'underwater'.
As long as people are working and paying rent, there's no real issue.
The topic of if a bank wants to use a legal option or not is not important if that option exists.
Circumstances change, legal options remain...
5ou are not able to predict how any bank will act into the future if they feel pressure to pull a legal lever.
Shadow
21 Sep 2015, 11:08 PM
No worries Chris. We'll just have to agree to disagree. I can't be bothered going through the whole debate again. Go read the 200 page thread if you're interested. Your questions are all covered there.
So your saying, like the climate change thread, you spent pages making claims that revolved around your personal view of the world and that you somehow think you won ? I doubt you won that one either... simply pretending your opinion trumps the real world is not winning, its stubborn and blinkered.
... land has, and always will belong to everyone ...
That's the crux of it John.
And if you really do believe that's how it should be, then you're a Georgist.
I've had a series of lengthy exchanges with one Georgist in particular in the past. And don't believe it will work. For the fundamental reason stated. (With a glaring example of why being the fact that I've yet to meet a Georgist who is anything but a 'national' Georgist at best - As in suggest that if the land and resources really do belong to 'everyone' as they so happily state, then there shouldn't be any need for passports or border controls, then it's been my experience that Georgists just don't really seem to be that committed to their stated Georgist principles at all.
But anyway, giving you the benefit of the doubt for now and at least tentatively accepting that you might actually be a 'real' Georgist, rather than just a Nationalist gimme, gimme type pretend one, how do you propose to fully compensate me for what is actually my land bought and paid for by me under our historically non-Georgist system when you change it into a Georgist one?
PS: On the off chance your answer is that you don't, then I'd suggest you are a Thief. A Georgist thief perhaps? But still a Thief.
A Professional Demographer to an amateur demographer:"negative natural increase will never outweigh the positive net migration"
The topic of if a bank wants to use a legal option or not is not important if that option exists. Circumstances change, legal options remain...
True, but consider if the nuclear option was taken up by lenders in a downturn.
One lender decides to re-possess all investment properties where the loan value is greater than the current market value (in spite of the fact that mortgages are being paid).
How do they get their money back? They can sell, but they will be selling at a loss.
They can rent out, but we are talking about properties already being rented out with mortgage payments up to date.
If they take the sell option, they will be flooding the market and driving prices even lower. Other lenders will be forced to use the same tactic to reduce their losses. Total meltdown.
So logic dictates that if the nuclear option exists, it won't be taken.
I am bearish on Perth property for sound economic reasons. The above scenario however, is pure bear fantasy.
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.
So logic dictates that if the nuclear option exists, it won't be taken.
I am bearish on Perth property for sound economic reasons. The above scenario however, is pure bear fantasy.
Yes. Despite house prices falling many times, and by a substantial amount in some regions of Australia, the banks have never tried to repossess people's homes in response.
The bank's asset is the mortgage, not the house. They lend money in order to receive an income stream. As far as the bank is concerned, if you never pay back the principal, all the better.
For a bank to swap a performing mortgage for a house that they must sell at a loss makes no commercial sense. Even when a mortgage is not performing, banks will generally bend over backwards to keep borrowers in their home, using mortgage holidays or refinancing options.
At the end of the day, all the bank cares about is its profits. It doesn't care about the borrower. Fortunately for the borrower, the best way for the bank to ensure that its profits keep flowing is to keep the borrower in the house and paying the mortgage.
Even in Ireland, where house prices crashed by 40%, the banks didn't do it.
No worries Chris. We'll just have to agree to disagree. I can't be bothered going through the whole debate again. Go read the 200 page thread if you're interested. Your questions are all covered there.
199 of those are you bombarding the forum with misleading information mainly via omission. But alas you are right, we will never agree so we'll leave it there.
The only way we'll find out if Of us are right is financial Armageddon, needless to say it's better for all if we don't find out!!!
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