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Houses in my Western Sydney suburb seem to be dropping; Proof included ;)
Topic Started: 19 Apr 2012, 09:55 AM (4,431 Views)
Sunder
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Frank Castle
19 Apr 2012, 11:57 AM
Waiting for that proof , thanks. :bye:




Hmm, when I think western Sydney I think suburbs such as Blacktown, Seven Hills etc where mid $3's is more the norm

I've been watching three regions Liverpool, Campbelltown and Blacktown. Each region, I've set up email alerts for about 3-5 suburbs around each regionthat I'm interested in, I've chosen these because gross yields in the area are 5.5-7.0%. Even a small fall would be a buy signal to me.

Like Carebear, I've seen some houses be relisted at lower and lower prices - but these were mostly houses that I thought was 'Tell 'im he's dreamin' ' prices anyway. My general feel is that prices have not significantly moved, except in Liverpool where higher quality and brand new stock is being released, sending the 'apparent' median up.

My feel is that we're in an L shaped recovery, and prices are neither going to fall nor rise substantially for a while, Eurozone debt crisis not withstanding. My second favourite theory is that if the general market flatlines for a number of years, people will get impatient, and cheaper areas like the west, but aren't largely housing commission or drug/crime affected will go up first. There's a big gap between upper middle and lower middle class suburbs, and that gap could be closed if there's no general market crash.
Property speculation is a type of gambling... But everyone knows that in gambling, the house always wins in the end.
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earthsta
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peter fraser
19 Apr 2012, 11:29 PM
Hell yes I have far too many real issues to be concerned with to be bothered doing theoretical calculations on the value of my home on a daily basis.

What sort of a wierdo would?

Chris Joye, apparently ;)
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NotFooled
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The Bear Whisperer

Sunder
20 Apr 2012, 03:01 AM

Like Carebear, I've seen some houses be relisted at lower and lower prices - but these were mostly houses that I thought was 'Tell 'im he's dreamin' ' prices anyway. My general feel is that prices have not significantly moved, except in Liverpool where higher quality and brand new stock is being released, sending the 'apparent' median up.

My feel is that we're in an L shaped recovery, and prices are neither going to fall nor rise substantially for a while, Eurozone debt crisis not withstanding. My second favourite theory is that if the general market flatlines for a number of years, people will get impatient, and cheaper areas like the west, but aren't largely housing commission or drug/crime affected will go up first. There's a big gap between upper middle and lower middle class suburbs, and that gap could be closed if there's no general market crash.
Yep, that's what I've been seeing too. The housing that is dropping is mainly based on idiotically high asking prices originally, possibly by people who were stupid enough to fall for buying at an excessively inflated price in the last 5 years, or by people just fishing to see if they can catch a sucker.

There is no fundamental, broadly based drop in prices.
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Frank Castle
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Business As Usual

Sunder
20 Apr 2012, 03:01 AM
I've been watching three regions Liverpool, Campbelltown and Blacktown. Each region, I've set up email alerts for about 3-5 suburbs around each regionthat I'm interested in, I've chosen these because gross yields in the area are 5.5-7.0%. Even a small fall would be a buy signal to me.

Like Carebear, I've seen some houses be relisted at lower and lower prices - but these were mostly houses that I thought was 'Tell 'im he's dreamin' ' prices anyway.
That's been my observation as well
Good quality recently renovated house sells for $450k (for example)
Shitbox a few doors down think they can sell for the same or similar whereas $325k is probably closer to the truth.

I don't consider that to be evidence of prices dropping across the board or a crash.

Edited by Frank Castle, 20 Apr 2012, 09:04 AM.
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The forum fuckwit goes RRRAAARRRGGHHhhh - But not a fuck was given..................by anyone.
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nipa hut
19 Apr 2012, 03:58 PM
Just a few letters make all the difference: a loss is not realised until the asset is sold.

An unrealised loss, OTOH, has impacts that are entirely context dependent:

(1) an otherwise cashed-up owner may temporarily--or even indefinitely--ignore the loss, and keep holding the asset in the expectation that the market for that asset will turn around. Whether that is wise or not depends on any interim return from the asset (noting that owner-occupation, if applicable, constitutes an in-kind return), and the likelihood and degree of a future positive rebound for the asset price. If the owner's overall portfolio is substantial enough, and broadly-based enough across asset classes, s/he can ignore temporary impairment of the value of any given asset. Or, if the asset value decline actually proves unrecoverable over time, there is (one hopes) other net worth against which to set off the loss.

(2) an owner for whom the asset is substantially, but not quite entirely, their only store of real wealth will generally be greatly constrained by an unrealised loss. S/he will be aware that crystallising the loss by selling would substantially wipe them out. But *not* sellling may well limit their opportunities to recover their losses in other realms, e.g. the owner won't pursue better employment opportunities outside his/her immediate location because s/he is underwater on the family home.

(3) an owner for whom the asset (particularly a house or unit) provides a negative net worth, unleavened by other positive equity, is in a position to walk away and start again, albeit with severe temporary restrictions on access to credit.

Peter Fraser's comments are quite valid with respect to Scenario (1). Wisebear's are quite valid with respect to Scenario (2). (I'll leave Scenario (3) to be fought over.)

Good post and excellent summation of the topic at hand! :-)
For Aussie property bears, "denial", is not just a long river in North Africa.....
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Doubtful
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Sydneyite
20 Apr 2012, 11:06 AM
nipa hut
19 Apr 2012, 03:58 PM
Just a few letters make all the difference: a loss is not realised until the asset is sold.

An unrealised loss, OTOH, has impacts that are entirely context dependent:

(1) an otherwise cashed-up owner may temporarily--or even indefinitely--ignore the loss, and keep holding the asset in the expectation that the market for that asset will turn around. Whether that is wise or not depends on any interim return from the asset (noting that owner-occupation, if applicable, constitutes an in-kind return), and the likelihood and degree of a future positive rebound for the asset price. If the owner's overall portfolio is substantial enough, and broadly-based enough across asset classes, s/he can ignore temporary impairment of the value of any given asset. Or, if the asset value decline actually proves unrecoverable over time, there is (one hopes) other net worth against which to set off the loss.

(2) an owner for whom the asset is substantially, but not quite entirely, their only store of real wealth will generally be greatly constrained by an unrealised loss. S/he will be aware that crystallising the loss by selling would substantially wipe them out. But *not* sellling may well limit their opportunities to recover their losses in other realms, e.g. the owner won't pursue better employment opportunities outside his/her immediate location because s/he is underwater on the family home.

(3) an owner for whom the asset (particularly a house or unit) provides a negative net worth, unleavened by other positive equity, is in a position to walk away and start again, albeit with severe temporary restrictions on access to credit.

Peter Fraser's comments are quite valid with respect to Scenario (1). Wisebear's are quite valid with respect to Scenario (2). (I'll leave Scenario (3) to be fought over.)

Good post and excellent summation of the topic at hand! :-)
I disagree with your logic. You are confusing the original issue by adding another variable to the mix - ie asset holders current financial status.

All your statements contain a financial status starting point. I dont adisagree with the statements that follow however its got bugger all to do with the original question.
is real(ised).

Nothing is anything until it is (zen). A paper loss on an investment cannot have an impact as it has not been realised. If the current paper value of the holders assets is being used to determine their current financial "worthiness" or position then I agree they will be impacted , however that is applying the statment to a financial position (only for the over leveraged) . I could offer many other scenarios whereby investors dont give a flying f.ck about their current position as they have the ability to ride the downturns and wait for the upswing.

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Mr Griffin
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For anything - a house as shelter, a house as an investment, shares, cars, groceries

If you buy today, and tomorrow it is cheaper you are worse off for buying at the higher price. It has cost you more.

No one can always buy every single consumable and investable item through their life at the best (lowest price) time, and for most things, doesn't matter that much. But you will always do better being conscience of this and buying stuff cheaper than the guy next door.

For young people though, a house is a big cost, so buying at the right time is massive regardless of them planning on living in there for 50 years or whatever.

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Sweetdish
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Mr Griffin
20 Apr 2012, 12:34 PM
For anything - a house as shelter, a house as an investment, shares, cars, groceries

If you buy today, and tomorrow it is cheaper you are worse off for buying at the higher price. It has cost you more.

No one can always buy every single consumable and investable item through their life at the best (lowest price) time, and for most things, doesn't matter that much. But you will always do better being conscience of this and buying stuff cheaper than the guy next door.

For young people though, a house is a big cost, so buying at the right time is massive regardless of them planning on living in there for 50 years or whatever.



My thoughts have always been that its best to buy when you are financially ready, not when you think you can pick the bottom of the market.
Because in the long run it will make no difference at all what you paid. They key is to never or extend yourself and be comfortable with the amount you are paying monthly.

My parents generation would not care if they paid 150K or 175K 25 years ago if their house is now worth $2M for example.
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those
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Sweetdish
20 Apr 2012, 01:00 PM
Mr Griffin
20 Apr 2012, 12:34 PM
For anything - a house as shelter, a house as an investment, shares, cars, groceries

If you buy today, and tomorrow it is cheaper you are worse off for buying at the higher price. It has cost you more.

No one can always buy every single consumable and investable item through their life at the best (lowest price) time, and for most things, doesn't matter that much. But you will always do better being conscience of this and buying stuff cheaper than the guy next door.

For young people though, a house is a big cost, so buying at the right time is massive regardless of them planning on living in there for 50 years or whatever.



My thoughts have always been that its best to buy when you are financially ready, not when you think you can pick the bottom of the market.
Because in the long run it will make no difference at all what you paid. They key is to never or extend yourself and be comfortable with the amount you are paying monthly.

My parents generation would not care if they paid 150K or 175K 25 years ago if their house is now worth $2M for example.
If you could comfortably afford to pay the mortgage on 1.16*X over 30 years, then you could potentially make the same payment on 1*X and finish paying in about 20 years.

Ask somebody in year 20 of a 30 year mortgage if the next 10 years of payments "matter that much."

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Mr Griffin
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Sweetdish
20 Apr 2012, 01:00 PM


My parents generation would not care if they paid 150K or 175K 25 years ago if their house is now worth $2M for example.
And this is exactly the mindset that will ruin so many young people

"It doesn't matter how much you pay for a house...in the end it will be worth heaps more"

My god, help us.
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