Leith van Onselen arrogantly and falsely claims as "MY HYPOTHESIS"; The theory that downsizing baby boomers will have a negative effect on house prices
Tweet Topic Started: 24 May 2012, 11:17 AM (5,602 Views)
No problem. I take the view that it's better to be beaten in a discussion on a point, and thus make better decisions because I'm better informed, than it is to simply indulge in ego boosting. There is no money or health benefit in large inflated egos the last time that I checked.
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I'm not allowing for anything happening in the future, only what has happened in the past. In historical terms, the BB generation is a very large generation (proportionally) heading into retirement. If you want to project a mass migration to Australia in the next 20 years, fine, but I don't see it happening without massive social unrest.
I would allow for past immigration rates to continue, but that's all. Regardless of our individual political opinions on that point, we can't deny reality.
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I've seen the salaries offered in Brisbane, and they are commensurate with those prices. Transport is better however than Sydney.
I've seen that said before. It will depend on the industry you are in.
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See for yourself: Life expectancy If you reach 60, life expectancy increases. This is admittedly unusual in a historic sense, but will add to the growing burden of supporting the BB generation through retirement.
Thank you.
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Now to 2020 should be a great opportunity in 'retirement lifestyle villages'.
I agree, but building retirement villages is beyond my financial capacity, and I resist offers of JV's even from close friends. You can't buy good friends with money, but you can easily lose them over money.
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Less immigration, the population is in decline. We need an immigration boom to maintain population growth. It will probably happen. The Roman Empire was cut in half by immigration, and that really was the end for them.
I can't see our net migration figures reversing in our lifetime - oneday but not yet.
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If we build a national broadband network, there is a real possibility of dispersal from cities, which is probably a good thing. We are coming to the end of the Mercantile Age, there is quite a way to go yet, but I think the trend will be for people to leave port cities and move inland. As you say, all speculation is probably wrong, but it's fun to imagine.
Yes I have similar thoughts, although the NBN will only hasten what is becoming a work/social mindshift. The NBN is merely a useful tool that will allow that to occur. Fifty years ago it would have been unheard of for an employer to allow someone to work from home unsupervised, but it is quite common now, and it is becoming increasingly so. Work time and space are now unimportant, it's output and deadlines that matter now.
I can gain a financial benefit from that type of information due to interests in commercial property (not resi) that will be affected by changes to work and social patterns. Catweasel may be horrified, but I see nothing wrong with informed speculation. Predicting change is a very worthwhile pastime.
Cheers...
Any expressed market opinion is my own and is not to be taken as financial advice
I've seen that said before. It will depend on the industry you are in.
The wrong one apparently
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I agree, but building retirement villages is beyond my financial capacity, and I resist offers of JV's even from close friends. You can't buy good friends with money, but you can easily lose them over money.
So true that.
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I can gain a financial benefit from that type of information due to interests in commercial property (not resi) that will be affected by changes to work and social patterns.
I think both retail and office space will go into a long term decline, in the same way warehouse space did after the logistics and transport revolution. Office space will probably be converted into crappy ... er .. luxury .. residential apartments, malls into sports stadiums or delivery depots. I also believe "premium" property on the water in coastal towns like Forster, Nelsons Bay, Coffs Harbour, Port Macquarie, Ballina will collapse in price as suddenly no one gives a shit about 'water views' when they are bored out of their mind in some coastal ghetto. I'm sure QLD has it's share of these future ghost towns as well.
Newton's laws of motion are three physical laws that form the basis for classical mechanics. They describe the relationship between the forces acting on a body and its motion due to those forces. They have been expressed in several different ways over nearly three centuries,[2] and can be summarized as follows: First law: The velocity of a body remains constant unless the body is acted upon by an external force.[3][4][5] Second law: The acceleration a of a body is parallel and directly proportional to the net force F and inversely proportional to the mass m, i.e., F = ma. Third law: The mutual forces of action and reaction between two bodies are equal, opposite and collinear.
To summarise - you claimed that "F=ma" was a "theory", rather than a hypothesis. I pointed out it was in fact considered a scientific or physical "law". You abusively continued to claim this was not the case, and that there was no such thing as a physical law. I proved there was such a thing! You then came back with further abuse, and said that this was irrelevant, as we were discussing "F=ma", which, UNDENIABLY, is in fact a physical law, known for centuries as "Newton's Second Law of Motion".
Do you feel like the complete idiot that you now look?
You know this happens quite regularly to you on here - you make some stupid statement, which get's proven wrong, but you continue hurling abuse at the posters pointing out your error and continue insisting that black is white, and when it is proven BEYOND ANY DOUBT or possible argument that you were completely wrong, you still will never admit it, or apologise for your unwarranted abuse. And you ask the question to others how they can function in society? I think it's pretty clear why you have never even come close to "making it" in life my abusive, obnoxious little padwan!
If you are in the Finance Industry, then I expect your opportunities in Brisbane are limited compared to Sydney and Melbourne. Sydney and Melbourne are full of Queenslanders (not just in the finance industry - IT as well, although less so lately) who would like to move back but would have to take a cut in salary to do it. Brisbane used to be the branch-office city, but now it is the sales-office city.
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I think both retail and office space will go into a long term decline, in the same way warehouse space did after the logistics and transport revolution. Office space will probably be converted into crappy ... er .. luxury .. residential apartments, malls into sports stadiums or delivery depots. I also believe "premium" property on the water in coastal towns like Forster, Nelsons Bay, Coffs Harbour, Port Macquarie, Ballina will collapse in price as suddenly no one gives a shit about 'water views' when they are bored out of their mind in some coastal ghetto. I'm sure QLD has it's share of these future ghost towns as well.
I wouldn't write off the sea change so fast. Lots of people move there to retire and right now a lot of it is going on and presumably will for some time. What I am seeing in the genaration just above me is that they are moving to their coastal house full-time and selling their house in the city to fund their retirement. But there is at least one more generation behind them, probably two.
What we might see is a secular slowdown in new construction as supply and demand become more balanced.
Your call about retail and office space might be a very good one. Certainly I am seeing a significant rediuction in office space per employee as working from home and hot desking become more prevalent.
The truth will set you free. But first, it will piss you off. --Gloria Steinem AREPS™
Leith van Onselen at it again. He now claims a theory that has been around for decades as his own. The theory he is claiming as his own is that downsizing boomers will have a negative effect on house prices. The theory may be true or false but it is certainly false that Leith created the theory as he claims.
Now my following statements may only be hypothetical (being assumed to exist as an immediate consequence of a hypothesis) that various theories have existed for some time about downsizing Baby Boomer economic influence. A hypothesis is a proposed explanation for a phenomenon. A phenomenon is any observable factual occurence. The phenomenon is the 'economic influence of downsizing Baby Boomers' (born between 1946 and 1964). If Baby Boomers start retiring at age 65 they would commence retirement in 2011. So the phenomenon has only just started occuring in 2011.
It would be fair to say a phenomenon can only be observed and described when it occurs or after it occurs. If the phenomenon has not been observed and has not occured prior to 2011, a hypothesis technically cannot be created (as a hypothesis is a proposed explanation for a phenomenon).
The quoted statement by Leith van Onselen is "my hypothesis is that Australia’s baby boomer generation – which comprises roughly one-quarter of the Australian population but owns nearly half of the nation’s housing assets – will gradually become net sellers of Australian housing as they enter retirement, thereby acting to push down home prices in the process".
Leith van Onselen may have observed the economic influence of Baby Boomer retirement since 2011, however he has not quoted any statistics to support the phenomenon (downsizing, selling up, reducing housing demand and increasing supply).
Now Strindburg you have stated that Leith has 'claimed a theory as his own ... that downsizing boomers will have a negative effect on house prices'. A theory refers to contemplation or speculation as opposed to action. Theories (pleural of theory) are collections of hypotheses that are logically linked together into a coherent explanation of some aspect of reality. There needs to be observable data, which is analysed.
Now to be fair Leith did not claim a 'theory', he claimed a 'hypothesis'. Given Baby Boomers commenced retiring in 2011 there will be ABS data that can be analysed from late 2012 onwards. So observable data can be measured to prove or disprove any hypothesis claimed.
So I disagree with your comments above. The phenomenon started to occur in 2011 so Leith can use the term hypothesis. You have misquoted Leith indicating he claimed a 'theory' and that is incorrect.
The theory (contemplation or speculation) about Baby Boomer economic influence at retirement may have been around for decades, however Leith van Onselen has only just developed a hypothesis in 2012.
Now comes the challenge of using ABS data to prove the hypothesis that "Australia’s baby boomer generation – which comprises roughly one-quarter of the Australian population but owns nearly half of the nation’s housing assets – will gradually become net sellers of Australian housing as they enter retirement, thereby acting to push down home prices in the process "
This could be a very interesting hypothesis to research.
Are you interested in facts old boy or just opinion?
Now my following statements may only be hypothetical (being assumed to exist as an immediate consequence of a hypothesis) that various theories have existed for some time about downsizing Baby Boomer economic influence. A hypothesis is a proposed explanation for a phenomenon. A phenomenon is any observable factual occurence. The phenomenon is the 'economic influence of downsizing Baby Boomers' (born between 1946 and 1964). If Baby Boomers start retiring at age 65 they would commence retirement in 2011. So the phenomenon has only just started occuring in 2011.
The phenomenon of retiring baby boomers has NOT only just started occurring in 2011.
See here. In 2007, a huge chunk of people then aged less than 65 had already retired. Amongst men, 4.5% of 45-49 year olds had retired 6.7% of 50-54 year olds had retired 16.5% of 55-59 year olds had retired 35.9% of 60-64 year olds had retired
We can safely assume that a great and significant number of boomers have already retired. I'm a boomer and I retired, age 46, in 1994.
This table gives the population by age. From it we can see that in 2010 we had: 781k men aged 45-49 727k men aged 50-54 656k men aged 55-59 604k men aged 60-64
If we apply the above percentages (from the 2007 data) to these figures it infers that: 35k men aged 45-49 have already retired 49k men aged 50-54 have already retired 108k men aged 55-59 have already retired 217k men aged 60-64 have already retired
That's a total of 409,000 men amongst the total of 2.768million men aged between 45 and 64 (roughly the boomers) who have already retired. That's 15% of them.
We also need to add women to this data.
The retirement of the boomers began around 20 years ago. Many professions and individuals have the opportunity to retire pre 65.
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Are you interested in facts old boy or just opinion?
Yes, I'm interested in facts rather than your pedantic pettiness about the definition of a theory or a hypothesis.
I think both retail and office space will go into a long term decline, in the same way warehouse space did after the logistics and transport revolution. Office space will probably be converted into crappy ... er .. luxury .. residential apartments, malls into sports stadiums or delivery depots. I also believe "premium" property on the water in coastal towns like Forster, Nelsons Bay, Coffs Harbour, Port Macquarie, Ballina will collapse in price as suddenly no one gives a shit about 'water views' when they are bored out of their mind in some coastal ghetto. I'm sure QLD has it's share of these future ghost towns as well.
I expect that there will be demand for well situated offices, as some formal offices will still be required, but any poorly located floorspace will struggle to get tenants.
Note that it has been difficult to get owners of strata titled offices/units to agree on anything. I believe you need 90% votes to agree to a change of use or a total sale of the property, although there are moves afoot to change that to 70% but that is still difficult to achieve.
Boomers - I'm not entirely convinced that they will sell and move anwhere. What is the benefit for them. They have greater asset wealth than the previous generation, but having large amounts of surplus cash just cuts down their entitlement. As I understand it people prior to WW2 didn't move, they stayed and died in their homes, close to families, friends, and familiar surroundings. Moving to an ocean front unit away from family and friends has lost it's appeal. They can hold some cash, draw the pension, and reverse mortgage an income paid monthly.
Just as the behaviour of each new generation changes, so does the behaviour of retirees.
But we will have to wait and see what will actually happen.
That's a total of 409,000 men amongst the total of 2.768million men aged between 45 and 64 (roughly the boomers) who have already retired. That's 15% of them.
Early retirement pre-supposes financial independence. 15% of generation is a large number to be financially independent, but I would opine that 15% is as large as it gets. That leaves 85% of the generation who are not financially independent before age 65 to retire between 2011 and ~2030.
Prior to 2007, Australia and the rest of the western world were at the end of the largest bull market in nearly 100 years, so it is not surprising that 15% of the Boomers (and even pre-war generation) retired early, but that still leaves the other 85% whose investments are now in decline.
If we have ZIRP, fixed interest will have a negative return. Equity prices are in Australia are a function of the AUD strength and not any particular strength of the companies that underlie them. That leaves property. To draw down an income from property one has to use a reverse mortgage
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I'm a boomer and I retired, age 46, in 1994.
So are you just here to talk your book? Because you don't seem interested in anyone else's opinion.
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