Golden days, old boy. I shudder at the alternative I could've taken with buying a pile of bricks. People say property is "safe" and stocks are "risky".
There is nothing wrong with investing in housing. You could invest in a builder, a brickmaking company or a furniture designer. All produce things that we need and create jobs at the same time.
But buying a cheap house, pricing out a potential first time buyer and then renting that place to the first time buyer you priced out? That's another thing. This has been the business model for your average Perth investor over the last 10 years or so. No new jobs created, nothing produced, no value added to society.
It appeared to be a good strategy for a while. Free money, pay a local RE a small percentage to manage it for you. So easy, anybody could do it.
Almost too good to be true.
And you know what they say...
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.
Golden days, old boy. I shudder at the alternative I could've taken with buying a pile of bricks. People say property is "safe" and stocks are "risky". Public companies actually make things and employ people. Entire towns derive their existence from the hard yards done by companies I'm proud to invest in. They push the envelope and generate the cash that specufestors are only too happy to siphon off in crippling rents thinking that doing nothing but being landlords entitles them to a free ride for life. Well, they're seeing the other side of the coin now, aren't they? Interestingly, America's wealthy/elite hold less than a 1/3rd of their wealth in property. And that includes their multiple palatial homes for private use. They no stupid. If you want to make money you need to push ahead, not sit idle.
I own two stand alone houses, worth about $3 m total, and I have reduced that number to reflect the down turn.
In an ideal world for me, I would have $0 in houses.
Both sites are close to the cbd, and both can be developed.
They cost me money every day of the week, and my principal place of residence is not tax deductible.
As a buisness it is just terrible.
And that is with it being worth 7 times what I paid for it in 1992.
Good luck.
No return, no invest.
Keep it simple.
Peter
Jimbo
12 Jun 2016, 03:22 AM
There is nothing wrong with investing in housing. You could invest in a builder, a brickmaking company or a furniture designer. All produce things that we need and create jobs at the same time.
But buying a cheap house, pricing out a potential first time buyer and then renting that place to the first time buyer you priced out? That's another thing. This has been the business model for your average Perth investor over the last 10 years or so. No new jobs created, nothing produced, no value added to society.
It appeared to be a good strategy for a while. Free money, pay a local RE a small percentage to manage it for you. So easy, anybody could do it.
Almost too good to be true.
And you know what they say...
Morally wrong, I agree.
And as we all know housing will get cheaper in real terms. Just like cars and electronic goods.
Gold bugs could easily drive gold to $10,000 or more. All they need to do is declare a date (I nominate Mayday, May 1st. 2017) when they all demand delivery of the gold they nominally hold via the COMEX. Faced with delivery of the ponzi rehypothecation they use, gold would surge beyond measure. Call their bluff!
Gold bugs could easily drive gold to $10,000 or more. All they need to do is declare a date (I nominate Mayday, May 1st. 2017) when they all demand delivery of the gold they nominally hold via the COMEX. Faced with delivery of the ponzi rehypothecation they use, gold would surge beyond measure. Call their bluff!
The world would go into turmoil. The German govt wasn't even allowed to audit their gold in person in the U.S.
Jim Rickards' stories have been going mental in the last 12 months. He obviously doesn't care anymore.
Gold bugs could easily drive gold to $10,000 or more. All they need to do is declare a date (I nominate Mayday, May 1st. 2017) when they all demand delivery of the gold they nominally hold via the COMEX. Faced with delivery of the ponzi rehypothecation they use, gold would surge beyond measure. Call their bluff!
That is the dream, just take delivery and pay for the gold.
Terry
13 Jun 2016, 05:13 PM
The world would go into turmoil. The German govt wasn't even allowed to audit their gold in person in the U.S.
Jim Rickards' stories have been going mental in the last 12 months. He obviously doesn't care anymore.
What gold One story,
I bought a share for $0.215 per share, it went down to $0.02 so my $50,000 turned into $4,800. Approximately. It then went to $0.42 plus a $0.02 dividend, I then sold it to buy kdr, kdr is now up to $0.165. So the $4,800 at its low point is now worth $175,000.
And in about 16 months.
Interesting game, wish I had more shares in those two companies.
But when my $50,000 turned into $4,800 I was not so sure.
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
Wages, savings, ability to borrow, willingness to borrow, preception of future upward price action, belief that others will compete for the same thing.....
The RE industry and those invested in it will always try and create the impression that one or more of the above demand factors is in play at this exact moment and that price growth is imminent.
Past bubbles are dismissed as being part of a normal market cycle.
Bubbles don't exist, never did, never will.
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.
Wages, savings, ability to borrow, willingness to borrow, preception of future upward price action, belief that others will compete for the same thing.....
The RE industry and those invested in it will always try and create the impression that one or more of the above demand factors is in play at this exact moment and that price growth is imminent.
Trades are saying building work in Perth has vanished.
Happy days, not.
Man this is getting bad.
Peter
My brickie mate who has been going flat out since 2012 has nothing on his books for the next two months. Asked me if we had any TA work going at our place but we have just laid off a heap of contract boilermakers so we won't be needing the help of a brickie.
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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