Captain Roberto Posted March 29, 2015 Share Posted March 29, 2015 http://m.news.domain.com.au/domain/real-estate-news/australia-is-in-one-of-the-worst-housing-bubbles-we-have-ever-seen-20150327-1m8vao.html Quote Link to comment Share on other sites More sharing options...
Captain Roberto Posted March 29, 2015 Author Share Posted March 29, 2015 Snakes and ladders Quote Link to comment Share on other sites More sharing options...
Gbye grey sky Posted March 29, 2015 Share Posted March 29, 2015 Not saying that the guy doesn't have a point but he is plugging a book here. Quote Link to comment Share on other sites More sharing options...
Captain Roberto Posted March 29, 2015 Author Share Posted March 29, 2015 Aye. True Quote Link to comment Share on other sites More sharing options...
paul1977 Posted March 29, 2015 Share Posted March 29, 2015 Aye. True Be interesting to see how far perths housing prices go over the next 3-5 years , I recon at least a 30% drop from their peak. With the mining boom finishing up and barrow Island and wheatstone projects due to finish soon too the booms then really over, you only have to look at the amount of rentals around now , there not shifting and people are slashing rents. WA went from the cheapest place to live in Australia to the dearest on the back of the boom.. The boom is over and WA still being the same as it was prior to the boom it's going to go back to how it was before. Quote Link to comment Share on other sites More sharing options...
grayzeee Posted March 29, 2015 Share Posted March 29, 2015 Having just left Perth, we were tossing up whether to rent or sell our house. There was a time , up until quite recently , where new rentals would come on the market , and there would be hoards turn up and start filling out the applications. In 2014 we started seeing a lot of rentals come up in our suburb (mullaloo) and sit there for months. We decided to sell and in sept we luckily did. The neighbour opposite us had a chat with the agent a few months later and was told not to expect the figures we got as property market had the brakes on. I can see many good points in this article. (particularly for Perth which rode the back of the mining industry to get where it is now) Quote Link to comment Share on other sites More sharing options...
Gbye grey sky Posted March 29, 2015 Share Posted March 29, 2015 The article refers to Sydney and Melbourne rather than Perth I believe. Quote Link to comment Share on other sites More sharing options...
paul1977 Posted March 29, 2015 Share Posted March 29, 2015 All in the same boat Quote Link to comment Share on other sites More sharing options...
Maruska Posted March 30, 2015 Share Posted March 30, 2015 I thought his evaluation was pretty accurate. There is no way I would be willing to spend 65-70% of a combined family income on a mortgage for the first year of a loan, especially since you can`t lock in the rates for the life of the loan ( as you can in the US). If the interest goes up, what percentage would it be then? 75 - 80 %. Doesn`t make any sense to buy at this point. Quote Link to comment Share on other sites More sharing options...
Parley Posted March 30, 2015 Share Posted March 30, 2015 (edited) The bubble (if it is indeed a bubble) will not deflate until interest rates rise in Australia. There is no sign of that happening for a few years at least. Probably a few further interest rates cuts this year followed by a year or two of rates on hold. Until rates rise and people struggle to pay for their large mortgages the prices will keep moving higher. I went to 2 auctions on the weekend near me. One sold for $1,190,000 and the other for $1,028,000. The second auction, the only bidders were young Asian couples. 4 of them battling it out. The other one was also Asians and one middle aged white couple who won out in the end. The only relevance is that around me it seems to be lots of Asians bidding and they are not afraid to pay large sums of money, even for a fairly average house. Edited March 30, 2015 by parleycross Quote Link to comment Share on other sites More sharing options...
paul1977 Posted March 30, 2015 Share Posted March 30, 2015 Not completely true , I agree rates will continue to fall, sign of a weak economy Quote Link to comment Share on other sites More sharing options...
Maruska Posted March 30, 2015 Share Posted March 30, 2015 Not completely true , I agree rates will continue to fall, sign of a weak economy Do you mean the interest rates? We had a loan in the US with the interest rate of 2.75 %. I think that right now, the US economy isn`t doing that bad, surely? The unemployment is low at this point too. Quote Link to comment Share on other sites More sharing options...
Captain Roberto Posted March 30, 2015 Author Share Posted March 30, 2015 The pros and cons of the free market capitalism. Those with the deepest pockets win. It's a global problem. We all pay into the system and the richest funnel all the cash into their accounts. I realise that this has always happened but since the last recession it seems to have got worse. It's ok if you got a property at the right time, but people entering the market now get a tough deal Quote Link to comment Share on other sites More sharing options...
paul1977 Posted March 30, 2015 Share Posted March 30, 2015 Do you mean the interest rates? We had a loan in the US with the interest rate of 2.75 %. I think that right now, the US economy isn`t doing that bad, surely? The unemployment is low at this point too. Your kidding, the U.S. has a debt it cannot repay, only a matter of time before it goes bust. Only so long you can carry on borrowing billions. The world I'm afraid is heading towards a depression triggered by the U.S. going bust Quote Link to comment Share on other sites More sharing options...
Maruska Posted March 30, 2015 Share Posted March 30, 2015 Your kidding, the U.S. has a debt it cannot repay, only a matter of time before it goes bust. Only so long you can carry on borrowing billions. The world I'm afraid is heading towards a depression triggered by the U.S. going bust US isn`t the only country borrowing money. Although I agree that huge amounts have been borrowed and spent( for questionable purposes), I think that right now, they are trying to do something about it and help the economy recover. It will take a long time, I guess we will see in the next several years if they are able to sustain the stability that the country achieved in the last 2 years or so. I do wish them well and I do hope they will make it. Quote Link to comment Share on other sites More sharing options...
paul1977 Posted March 30, 2015 Share Posted March 30, 2015 They won't make it, the clock is ticking.. Their going under and then we all follow Quote Link to comment Share on other sites More sharing options...
bunbury61 Posted March 31, 2015 Share Posted March 31, 2015 Your kidding, the U.S. has a debt it cannot repay, only a matter of time before it goes bust. Only so long you can carry on borrowing billions. The world I'm afraid is heading towards a depression triggered by the U.S. going bust 17 trillion dollars debt....85 billion a MONTH to prop up the U.S economy Quote Link to comment Share on other sites More sharing options...
paul1977 Posted March 31, 2015 Share Posted March 31, 2015 17 trillion dollars debt....85 billion a MONTH to prop up the U.S economy That's what I mean, only a matter of time Quote Link to comment Share on other sites More sharing options...
Parley Posted March 31, 2015 Share Posted March 31, 2015 US has always been in huge debt. They will survive. As Maruska said things are improving over there. I read yesterday Melbourne's population increased by 98000 last year and is increasing by 1800 people every week, All these people need houses to live in so will also help support the property market. There is growing demand for housing with immigration and movement of people from other states. Quote Link to comment Share on other sites More sharing options...
Parley Posted March 31, 2015 Share Posted March 31, 2015 Traders are pricing in a 74 per cent chance the RBA will cut rates next week. This will further boost property. Perth may be a special case due to the plummeting commodities prices. So may react differently to the rest of the country. Quote Link to comment Share on other sites More sharing options...
paul1977 Posted March 31, 2015 Share Posted March 31, 2015 (edited) Traders are pricing in a 74 per cent chance the RBA will cut rates next week. This will further boost property. Perth may be a special case due to the plummeting commodities prices. So may react differently to the rest of the country. Cutting rates is a sign of a weak economy Edited March 31, 2015 by paul1977 Quote Link to comment Share on other sites More sharing options...
Gbye grey sky Posted March 31, 2015 Share Posted March 31, 2015 All of these countries owing all this money. Seems almost everything and everyone is in debt. Who is lending this money? Quote Link to comment Share on other sites More sharing options...
Parley Posted March 31, 2015 Share Posted March 31, 2015 Cutting rates is a sign of a weak ecomamy Doesn't matter it will encourage people to borrow and support house prices. Quote Link to comment Share on other sites More sharing options...
paul1977 Posted March 31, 2015 Share Posted March 31, 2015 Intrest rates are cut to try to stimulate a stuttering economy, not really to keep overinflated house prices high, mortgage repayments may seem low but it's only delaying the pain when they rise Quote Link to comment Share on other sites More sharing options...
Parley Posted March 31, 2015 Share Posted March 31, 2015 True. All I know is people are lining up to pay well over $1M near me for houses. Youngish Asian couples. Whether they are rich, or are borrowing $800000 mortgages at 4.5% i would love to know. I think there will be a correction but not till interest rates are in a rising cycle, and currently they are still falling, so I think the correction is a few years away yet. Quote Link to comment Share on other sites More sharing options...
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