Simply saying that 'affordability' is better than it was is not a convincing case Shadow.
Sydney is an international city with a diverse, multifaceted economy, strong inflows of FDI and heavy international investment in the property market. Perth can boast none of these aspects and until it does there will be a ceiling for growth.
In terms of the mining & o&g sector in WA, i recommend investigating just how far into the implementation stages the likes of Rio, Fortescue, Roy Hill, Woodside etc are with automation. Even in the instance of Iron Ore and Oil prices skyrocketing again, those high paying jobs for maintenance engineers, drivers etc are not going to be there in the numbers that they were. As such, even in the event of a boom there will remain downward pressure on salaries and therefore downward pressure on Perth property.
The bears in 2011 also came up with all sorts of good reasons why Sydney couldn't possibly rise again.
One common bear refrain was that the conditions that drove the previous boom no longer existed, therefore there couldn't be another boom.
When they (and you) fail to recognise is that a boom does not necessarily need to be driven by identical factors to those that drove the previous boom.
Having said that, a large improvement in affordability is a key factor that many booms share (even though the ancillary fundamental drivers are often different).
Affordability is a very important factor. In 2006, Perth's median house price was the same as Sydney's. Now it's less than half. Perth is going to boom.
Having said that, a large improvement in affordability is a key factor that many booms share
Affordability is a very important factor. In 2006, Perth's median house price was the same as Sydney's. Now it's less than half. Perth is going to boom.
The Desire for Profit/Risk Taking and the Availability of Credit Drive Booms.........
Let Us know when you decide to stop Talking Shit and Buy......In Perth.
Speaking of that, many outer suburbs of Melbourne where the working semi-poor used to save up for and buy have now been taken over by house price speculators. Seems they have to scrape the bottom of the barrel for proper tenants and now these suburbs are falling apart a bit at a time, you know old cars on bricks, grass not mown, police sirens most nights, hoons doing burnouts, the usual feral activities. So all in all the 'investors' have done a real job in these places, cant wait till the bust here and they all want to sell, real buyers might have gotten fussy about their neighbours in the meantime.
Nothing new, there is burbs of every city evident.
Newjerk? can you try harder than dig up another person's blog. My first promo was with Billabong and my name in English is modified with a T, am Perth born but also lived in Sydney to make my $$ It's Absolutely Fabulous if it includes brilliant locations, & high calibre tenants..what more does one want? Understand the power of the two "P"" or be financially challenged Even better when there is family who are property mad and one is born in some entitlements.....Understand that beautiful women are the exhibitionists we crave attention, whilst hot blooded men are the voyeurs ... A stunning woman can command and takes pleasure in being noticed. Seems not too many understand what it means to hold and own props and get threatened by those who do. Banks are considered to be law abiding and & rather boring places yeah not true . A bank balance sheet will show capital is dwarfed by their liabilities this means when a portions of loans is falling its problems for the bank.
The bears in 2011 also came up with all sorts of good reasons why Sydney couldn't possibly rise again.
One common bear refrain was that the conditions that drove the previous boom no longer existed, therefore there couldn't be another boom.
When they (and you) fail to recognise is that a boom does not necessarily need to be driven by identical factors to those that drove the previous boom.
Having said that, a large improvement in affordability is a key factor that many booms share (even though the ancillary fundamental drivers are often different).
Affordability is a very important factor. In 2006, Perth's median house price was the same as Sydney's. Now it's less than half. Perth is going to boom.
Your argument boils down to this: Its Perth's turn.
But you also seem to accept that the fundamentals will have to be there.
Which begs the question, what exactly will those fundamentals be and how will the emerge?
For example, are you expecting there to be a massive turnaround in population growth. Because that is certainly required.
What will create that?
Or is this more mystic meg magical property cycle voodoo you are spruiking?
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
The bears in 2011 also came up with all sorts of good reasons why Sydney couldn't possibly rise again.
One common bear refrain was that the conditions that drove the previous boom no longer existed, therefore there couldn't be another boom.
When they (and you) fail to recognise is that a boom does not necessarily need to be driven by identical factors to those that drove the previous boom.
Having said that, a large improvement in affordability is a key factor that many booms share (even though the ancillary fundamental drivers are often different).
Affordability is a very important factor. In 2006, Perth's median house price was the same as Sydney's. Now it's less than half. Perth is going to boom.
Boom? No slow improvement.
Newjerk? can you try harder than dig up another person's blog. My first promo was with Billabong and my name in English is modified with a T, am Perth born but also lived in Sydney to make my $$ It's Absolutely Fabulous if it includes brilliant locations, & high calibre tenants..what more does one want? Understand the power of the two "P"" or be financially challenged Even better when there is family who are property mad and one is born in some entitlements.....Understand that beautiful women are the exhibitionists we crave attention, whilst hot blooded men are the voyeurs ... A stunning woman can command and takes pleasure in being noticed. Seems not too many understand what it means to hold and own props and get threatened by those who do. Banks are considered to be law abiding and & rather boring places yeah not true . A bank balance sheet will show capital is dwarfed by their liabilities this means when a portions of loans is falling its problems for the bank.
Your argument boils down to this: Its Perth's turn.
But you also seem to accept that the fundamentals will have to be there.
Which begs the question, what exactly will those fundamentals be and how will the emerge?
For example, are you expecting there to be a massive turnaround in population growth. Because that is certainly required.
What will create that?
Or is this more mystic meg magical property cycle voodoo you are spruiking?
Whilst I don't agree that a city can boom because it's their turn, don't discount the possibility of a new boom in WA. Volumes being shipped from Port Hedland are rising and have reached capacity, demand for copper is rising strongly which signals a lift in global demand for many industries, and WA has some rare earth deposits that could soon boom.
I don't think it will be as strong as the iron ore boom, but it might still surprise a lot of people in WA. Never say never.
Take risks - if you win you will become wealthy, if you lose you will become wise
Because they are lifelong Perth residents and always will be, therefore they have a deep emotional connection to their properties & the prospects of the Perth market.
Fair enough i guess. But that's why you never hear an utterance from the Perth investors on any other property market in Australia. They are too blinkered and bogged down in their own patch and will blag on and on and on about Perth until the end of time and they'll NEVER concede because of their emotional connection to their town. A bit like those people you see who have a family member who obviously committed a crime, but instead of accepting it they are willing to turn the other cheek and deny it all in the face of irrefutable evidence.
As i've always said, i quite like Perth and the surrounding areas. A bit dull, but nice nevertheless. However in my opinion the prospects of Perth will always have a very hard ceiling for growth and a very limited diversity in its economy due to it's geography.
The Perth bulls need to wake up to that fact sooner rather than later and diversify into markets that are actually worth their while.
I'm not a bull so don't assume.
Perth is my home but I'm aware what Sydney was like some time ago and I understand if I was a owner/investor concentrating on for eg Sydney's Northern beaches like North Curl Curl..... or feel that Newcastle beach sand again. I would not be regretting it.
On the contrary I do check on Sydney stuff.
The small town feel that you are keen to insult? Its better than smog and not see the whole city skyline like places in Bangkok.
Newjerk? can you try harder than dig up another person's blog. My first promo was with Billabong and my name in English is modified with a T, am Perth born but also lived in Sydney to make my $$ It's Absolutely Fabulous if it includes brilliant locations, & high calibre tenants..what more does one want? Understand the power of the two "P"" or be financially challenged Even better when there is family who are property mad and one is born in some entitlements.....Understand that beautiful women are the exhibitionists we crave attention, whilst hot blooded men are the voyeurs ... A stunning woman can command and takes pleasure in being noticed. Seems not too many understand what it means to hold and own props and get threatened by those who do. Banks are considered to be law abiding and & rather boring places yeah not true . A bank balance sheet will show capital is dwarfed by their liabilities this means when a portions of loans is falling its problems for the bank.
The bears in 2011 also came up with all sorts of good reasons why Sydney couldn't possibly rise again.
One common bear refrain was that the conditions that drove the previous boom no longer existed, therefore there couldn't be another boom.
When they (and you) fail to recognise is that a boom does not necessarily need to be driven by identical factors to those that drove the previous boom.
Having said that, a large improvement in affordability is a key factor that many booms share (even though the ancillary fundamental drivers are often different).
Affordability is a very important factor. In 2006, Perth's median house price was the same as Sydney's. Now it's less than half. Perth is going to boom.
I don't care what the Bears thought in 2011.
I care about whats going on in Perth now and it's prospects into the immediate future.
Quote:
When they (and you) fail to recognise is that a boom does not necessarily need to be driven by identical factors to those that drove the previous boom.
Tell me what you think will be driving the imminent Perth boom then. What is driving your thinking on a $1M+ boom?
Even with improving commodity prices, i can't see it. At best, sluggish growth of 2-3% which certainly won't attract me or anyone else from interstate or overseas to invest (not that they ever did when things were booming either). With countless formerly high paying roles in the most profitable sectors in the process of being automated or outsourced to third parties elsewhere, where is all this extra income going to come from?
Wages aren't going to support a boom at all, let alone one of the magnitude you are suggesting.
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