Society/Culture Australian Property Prices to Crash?

[greyhound punter]

There’s regional differences, bu when have house prices stayed level for a decade ever?

Just because something hasn't happened before, does not mean it can't happen.

 

[Gigantic]

This here is the problem.

People say my house is work x amount of dollars. It looks good on paper, but as we are seeing, once people need to convert that paper value to real cash, it becomes problematic.

The way I like to frame it is - a person's house is only worth what a bloke is willing to pay for a neighbour's house down the street.

Australia's $9 trillion residential property sector, and consequently the financial and real economy, is held up by the fragile egos of properdee crazed Aussies.

 

[Eastern Rangers]

The only reason the RBA is charged with controlling inflation is because no government would ever survive more than 1 term. There would be many ways the government could control inflation, but they would be voted out straight away.

I try to spread the gospel that the government should be moderately raising taxes to curb inflation.

Sent from my Pixel 6 using Tapatalk

 

[peetoo]

The way I like to frame it is - a person's house is only worth what a bloke is willing to pay for a neighbour's house down the street.

Australia's $9 trillion residential property sector, and consequently the financial and real economy, is held up by the fragile egos of properdee crazed Aussies.

And the financial disincentive to moving too often…stamp duty

 

[Leeda]

Just because something hasn't happened before, does not mean it can't happen.

Just because something has happened previously, doesn't mean we should all batten down the hatches...
scary thoughts will do that to you..

 

[Mindtraveller]

And the financial disincentive to moving too often…stamp duty

Interested in watching the NSW libs change on this (although wasn't there reports both NSW and Vic wanted to do it, but wanted financial support from the government for the change over).

Need to do something different.

As for housing, going up 20% in 1 year during Covid is nuts and someone (like the RBA) might need to be given more controls

 

[TheEscapeClub]

Friend trying to sell his house in Ballarat ...the real estate he is using had nine open houses last Saturday , only one person showed up across all nine properties !
If interest rates keep on edging higher I am not sure if it would make more sense for investors to dump their money in the bank for a guaranteed return rather than jump into property investment which could take some time to return to any sort of growth.
I don't really see it as a crash yet , the worst case scenario is that a significant amount of these fixed rate lenders coming off low rates this year are under mortgage stress and get forced to the wall if another couple of interest rises hits. Unemployment rising as well could accelerate things.

I've just moved to Ballarat, it might be a good time to buy if my wife decides she likes it here enough to commit. I want to at least be here for the Commonwealth Games, but you never know what might happen in life.

 

[Gigantic]

As for housing, going up 20% in 1 year during Covid is nuts and someone (like the RBA) might need to be given more controls

Yeah, APRA.

 

[Frank Grimes]

And the financial disincentive to moving too often…stamp duty

I know this may not be what you are referring too, but I just want to bring up something in conversation.

I think the perception of retired people want to downsize but can't because of stamp duty is over blown. I know with my elderly parents even without having to pay stamp duty they prefer to continue to live in their current house. I think it's because after living there (including the surrounding community) for so many years there is familiarity to it and gives them a feeling of security. Moving to a new place (including the moving process itself) would bring stress they don't want.

What's more I think they prefer not to have to pay a yearly $1000+ land tax. Even if stamp duty is removed the new house they buy would pretty much cost the same regardless (house prices are ultimately determined by what people are willing to pay for them. The bank would lend the same amount regardless if stamp duty is there or not).

 

[Mindtraveller]

Yeah, APRA.

Showed they're useless. Need to be moved under the umbrella as the RBA

 

[peetoo]

I know this may not be what you are referring too, but I just want to bring up something in conversation.

I think the perception of retired people want to downsize but can't because of stamp duty is over blown. I know with my elderly parents even without having to pay stamp duty they prefer to continue to live in their current house. I think it's because after living there (including the surrounding community) for so many years there is familiarity to it and gives them a feeling of security. Moving to a new place (including the moving process itself) would bring stress they don't want.

What's more I think they prefer not to have to pay a yearly $1000+ land tax. Even if stamp duty is removed the new house they buy would pretty much cost the same regardless (house prices are ultimately determined by what people are willing to pay for them. The bank would lend the same amount regardless if stamp duty is there or not).

There have been incentives to downsize, and smart person might think as time goes on these might get better -so why rush?

Only do it for lifestyle not finances. Why put it into super where the growth might be taxed when the primary home won’t be.

Use super as cashflow but the home as the wealth hedge against inflation, or living longer than you budgeted for

 

[DangerousD]

I try to spread the gospel that the government should be moderately raising taxes to curb inflation.

Sent from my Pixel 6 using Tapatalk

Of course, raising interest rates is raising taxes, just under a different name

 

[00Stinger]

I've just moved to Ballarat, it might be a good time to buy if my wife decides she likes it here enough to commit. I want to at least be here for the Commonwealth Games, but you never know what might happen in life.

Ballarat is pretty nice

Lake Wendouree is fantastic and the gardens around it.

And now there are heap of cool bars and food places on and around Sturt street it would be a great place to live

 

[jb40]

Interested in watching the NSW libs change on this (although wasn't there reports both NSW and Vic wanted to do it, but wanted financial support from the government for the change over).

Need to do something different.

As for housing, going up 20% in 1 year during Covid is nuts and someone (like the RBA) might need to be given more controls

more power to the the RBA?
first they said there will be no interest rate hikes until 2024 then scomo throws out grants whilst building sites are closed due to the bat flue and banks are being banks
then you have the skills shortage, then Rob Lowe hikes the interest rates up 9 times in as many months.

then the ALP get in power and allows mass migration begins

us as Australian citizens are treated as second class whilst being screwed over as long as the banks make profits and the bankers are happy is the only outcome in the current system

 

[peetoo]

more power to the the RBA?
first they said there will be no interest rate hikes until 2024 then scomo throws out grants whilst building sites are closed due to the bat flue and banks are being banks
then you have the skills shortage, then Rob Lowe hikes the interest rates up 9 times in as many months.

then the ALP get in power and allows mass migration begins

us as Australian citizens are treated as second class whilst being screwed over as long as the banks make profits and the bankers are happy is the only outcome in the current system

Australia the worlds biggest company mining camp. If you were in doubt the ‘bat flu’ as you put it - lockdowns removed that doubt

 

[jb40]

Australia the worlds biggest company mining camp. If you were in doubt the ‘bat flu’ as you put it - lockdowns removed that doubt

we are talking about property prices here?

 

[CatToTheFuture]

I try to spread the gospel that the government should be moderately raising taxes to curb inflation.

Sent from my Pixel 6 using Tapatalk

This is both good, and, highly likely to get you stabbed

 

[Cap]

I think this broadly sits here

'Workers left to pick up the crumbs': Former RBA boss Bernie Fraser slams neoliberal Australia

Former governor Bernie Fraser says the Reserve Bank of Australia's attempt to improve the welfare of all Australians has been undermined by decades of neoliberalism.

www.google.com

May 9th we will be seeing potentially a review of the RBA

It is going to be interesting to see what, if any changes they make.

 

[Gigantic]

colour me surprised, the reserve bank of property wants everyone to know where their priorities lie

 

[Kwality]

colour me surprised, the reserve bank of property wants everyone to know where their priorities lie

At least they arent putting mayo on interest rates;
Minutes from the 4 April rates meeting, released on Tuesday, show the nine board members examined at length the case for another 25 basis-point increase. That would have made it 11 consecutive rate hikes and lifted the cash rate to 3.85%.

In the end, there was “a stronger case to pause” at the April gathering than to lift the cash rate.

Still, “it was important to be clear that monetary policy may need to be tightened at subsequent meetings”, implying that the RBA may still have more than one rate rise to come.

RBA hints at further interest rate rises as minutes reveal pause was lineball

The nine board members were very close to raising the cash rate another 25 basis points in April due to inflation and labour market

www.theguardian.com

 

[peetoo]

So yet another crash turns out to be a correction.

AI is going to do it now apparently

Suburbs where AI could take jobs and create a middle class 'rust belt'

An analysis by Suburbtrends showed Melbourne home to 14 of the 20 worst affected postcodes for AI taking jobs, with Sydney taking four spots and regional NSW having two places

www.dailymail.co.uk

 

[kranky al]

I try to spread the gospel that the government should be moderately raising taxes to curb inflation.

Sent from my Pixel 6 using Tapatalk

I feel that they should raise the superannuation rate they and employers pay on their behalf instead of interest rates.

Has the same effect of taking money out of the economy but it means more super when you retire.

 

[HirdyLannister]

29-year-old failed cricketer claims to have ‘cracked the property code’ by buying 37 homes in three years - realestate.com.au

A 29-year-old Aussie says he’s cracked the code of the housing market by attaining $13m of real estate in just three years. Now he shares the tips that helped him do it.

www.realestate.com.au

Good effort, helping the rental market.
Prices ain't crashing anytime soon.

 

[greyhound punter]

29-year-old failed cricketer claims to have ‘cracked the property code’ by buying 37 homes in three years - realestate.com.au

A 29-year-old Aussie says he’s cracked the code of the housing market by attaining $13m of real estate in just three years. Now he shares the tips that helped him do it.

www.realestate.com.au

Good effort, helping the rental market.
Prices ain't crashing anytime soon.

Plenty of investahs looking to offload properties yielding less than savings accounts - the crash is already starting, i expect it to grind lower over the next 12 months before accelerating as inflation returns and interest rates eventually hit double figures.

I get the idea that people think the government won't let housing fall, but it is, and it will.

As the economy deteriorates, population growth will fall, and plenty of houses will hit the market.

The smart money has already left the property market.

 

[greyhound punter]

At least they arent putting mayo on interest rates;
Minutes from the 4 April rates meeting, released on Tuesday, show the nine board members examined at length the case for another 25 basis-point increase. That would have made it 11 consecutive rate hikes and lifted the cash rate to 3.85%.

In the end, there was “a stronger case to pause” at the April gathering than to lift the cash rate.

Still, “it was important to be clear that monetary policy may need to be tightened at subsequent meetings”, implying that the RBA may still have more than one rate rise to come.

RBA hints at further interest rate rises as minutes reveal pause was lineball

The nine board members were very close to raising the cash rate another 25 basis points in April due to inflation and labour market

www.theguardian.com

People need to understand - we aren't going back to 0% interest rates, it is fantasy land stuff - we are going higher, there was a graph i posted on another thread that tracked US CPI from 2013 to now, compared to the US CPI from late 1960s to early 1980s.

It is strikingly similar - inflation is going to return with a bang, there is no doubt in my mind - the bond market suggests plenty of upside potential for yields.

Party is over.