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Hit The Bid! Australian property is intensely vulnerable. Why property is in trouble.; A housing bust is inevitable and cannot be avoided!
Topic Started: 22 Sep 2015, 03:56 PM (7,036 Views)
Shadow
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Evil Mouzealot Specufestor

foxbat
23 Sep 2015, 12:39 AM
Hi Shadow, we got to get "real"

Real terms please.

Peter :oo:
Already covered in post #15.

Shadow. :oo:
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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Foxy
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Zero is coming...

skamy
23 Sep 2015, 12:19 AM
Come on Veritas - do you seriously still believe the nonsense this guy posts?

How many years will you waste your life paying rent waiting on these silly fantasies of highly unlikely outcomes for our rich cities?

This guy is just an Armageddon spruiker these types have been around for hundreds of years why are you taken in by it over and over again?
I own Perth residential, will not be selling it any time soon, but i will not be buying any time soon.

I try to hedge.

So if something goes up, or down it is not a problem.

I am looking at an asset that is probably going to enter liquidation any day now, i have been adding to that position for 35 years now.

So one mans pudding is another mans poison.

Peter

Sydney will return to the mean.

Perth is returning to the mean.

Simple really.

Good luck people.

http://www.afr.com/content/dam/images/g/n/2/1/u/8/image.imgtype.afrArticleInline.620x0.png/1456285515560.png
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Strindberg
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The Whole Truth
22 Sep 2015, 10:24 PM

Which would take them back to around what they were in 2002.
Property investment, or buying a PPOR,. with rises in real terms is a very profitable exercise - compared to renting or living in your dad's shed.

Just imagine if you had listened to Shadow or Bear Trap. You and your missus would now be all lovey dovey and hunky dory - instead of bitter.
Housing costs to Income broadly unchanged since 1994 - re-ratified here
The People of Australia have the highest median wealth in the World
2002-2012 10 year house price growth the SLOWEST since 1952-1962
"There are two kinds of people in this world: ones that fiddle around wondering whether a thing's right or wrong and guys like us." (Hugo to Gagin in Ride the Pink Horse)
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Sydneyite
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Veritas
23 Sep 2015, 12:11 AM
A 30% fall means hundreds of thousands in negative equity.
How do you figure that? How many people do you think bought a house on Sydney at current prices on a > 90% LVR? You are massively overstating the numbers, even for this unlikely scenario .
For Aussie property bears, "denial", is not just a long river in North Africa.....
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The Whole Truth
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Strindberg
23 Sep 2015, 12:45 AM
The Whole Truth
22 Sep 2015, 10:24 PM

Which would take them back to around what they were in 2002.
Property investment, or buying a PPOR,. with rises in real terms is a very profitable exercise - compared to renting or living in your dad's shed.

Just imagine if you had listened to Shadow or Bear Trap.
I do listen to shadow, and credit where credit is due his call on sydney years ago eventually came to pass roughly as he stated. Now he seems bearish and is willing to accept a 30% decline in prices and thinks a crash in the stock market is no problem. Since my ppor is paid off and I have no money in the stockmarket I agree with him.

His example of buying IP's on IO loans though I did not follow. Which means I'm not beholden to anyone, a nice feeling at this point in history.
"Panics do not destroy capital; they merely reveal the extent to which it has been previously destroyed by its betrayal into hopelessly unproductive works." John Stuart Mill
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Strindberg
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Veritas
23 Sep 2015, 12:11 AM
How many Sydney properties will you be buying this year?

It doesnt matter.

A 30% fall means hundreds of thousands in negative equity.
?????
Rough estimates.
80% LVR is the highest available for most people.
A purchase over 12 months ago has risen ~20% or more (ABS).
No negative equity with 30% crash for most who purchased over a year ago.

9 million dwellings in Oz so about 1.5m in Sydney.
500 thousand dwelling purchases in oz in a year so about 80,000 dwelling purchases in Sydney over the last year, most of which will have LVRs at purchase time of less than 80%.
A small fraction of the 80,000 dwellings purchased in the last year would go into negative equity with 30% crash. Not "hundreds of thousands". Purchases even 6 months ago have seen ~10% rises, enough with original equity to cover a 30% crash for most.


Housing costs to Income broadly unchanged since 1994 - re-ratified here
The People of Australia have the highest median wealth in the World
2002-2012 10 year house price growth the SLOWEST since 1952-1962
"There are two kinds of people in this world: ones that fiddle around wondering whether a thing's right or wrong and guys like us." (Hugo to Gagin in Ride the Pink Horse)
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hoofarted
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Strindberg
23 Sep 2015, 10:25 AM
?????
Rough estimates.
80% LVR is the highest available for most people.
A purchase over 12 months ago has risen ~20% or more (ABS).
No negative equity with 30% crash for most who purchased over a year ago.

9 million dwellings in Oz so about 1.5m in Sydney.
500 thousand dwelling purchases in oz in a year so about 80,000 dwelling purchases in Sydney over the last year, most of which will have LVRs at purchase time of less than 80%.
A small fraction of the 80,000 dwellings purchased in the last year would go into negative equity with 30% crash. Not "hundreds of thousands". Purchases even 6 months ago have seen ~10% rises, enough with original equity to cover a 30% crash for most.

When people sell, and buy somewhere else, it is usually only the difference that is additional finance. Everything else stays mostly the same. I too think "hundreds of thousands" is way too many.
Edited by hoofarted, 24 Sep 2015, 12:18 AM.
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newjez
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Estate agent called me today and asked me if I wanted to sell. It's been along time between calls. I expect the Sydney market to be the same. Well done shadow, but you must be thinking of banking some profits?
Whenever you have an argument with someone, there comes a moment where you must ask yourself, whatever your political persuasion, 'am I the Nazi?'
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Jimbo
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peter fraser
22 Sep 2015, 09:20 PM
Well if it decimates the economy then interest rates will have to be cut and stimulus unleashed.
Watered down beer is a sure sign that a once great pub is on its last legs.
The Whole Truth
23 Sep 2015, 10:14 AM
His example of buying IP's on IO loans though I did not follow. Which means I'm not beholden to anyone, a nice feeling at this point in history.
Because property never goes down, Australia doesn't have recessions. You can borrow to buy the first one, use the first one as security on the second one, use the first two as security on an empire and retire at 30.

It really is that easy and we live in a country where an entire generation has an unquestioning acceptance of this strategy.

Work is just something you do until your portfolio is big enough to travel the world on.

My 13 year old son has told me how it works. All the other kids at school told him about their parents 15 rentals and how they were all multi millionaires. "Why don't we have any rentals dad?".

Hard to answer to be honest. I have tried to explain debt to him. I have tried to explain that these kids parents don't really own anything. But it falls on deaf ears.

When your 13 year old kid is being peer pressured into an investment, it is one of two things.

Either you are totally out of touch, behind the times, aged demented.

Or, it is the biggest Ponzi scheme in the history of Ponzi schemes.
Edited by Jimbo, 24 Sep 2015, 07:14 AM.
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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newjez
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Jimbo
24 Sep 2015, 06:58 AM
Watered down beer is a sure sign that a once great pub is on its last legs.

Because property never goes down, Australia doesn't have recessions. You can borrow to buy the first one, use the first one as security on the second one, use the first two as security on an empire and retire at 30.

It really is that easy and we live in a country where an entire generation has an unquestioning acceptance of this strategy.

Work is just something you do until your portfolio is big enough to travel the world on.

My 13 year old son has told me how it works. All the other kids at school told him about their parents 15 rentals and how they were all multi millionaires. "Why don't we have any rentals dad?".

Hard to answer to be honest. I have tried to explain debt to him. I have tried to explain that these kids parents don't really own anything. But it falls on deaf ears.

When your 13 year old kid is being peer pressured into an investment, it is one of two things.

Either you are totally out of touch, behind the times, aged demented.

Or, it is the biggest Ponzi scheme in the history of Ponzi schemes.
They can't all have IPOs jimbo? Who would they rent them to? Your vacancy rate would be going through the roof if that was the case. Oh ...
Whenever you have an argument with someone, there comes a moment where you must ask yourself, whatever your political persuasion, 'am I the Nazi?'
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