House prices

Blowin's picture
Blowin started the topic in Friday, 9 Dec 2016 at 10:27am

House prices - going to go up , down or sideways ?

Opinions and anecdotal stories if you could.

Cheers

GuySmiley's picture
GuySmiley's picture
GuySmiley commented Wednesday, 23 Aug 2017 at 5:27pm

Insight on SBS last night detailed the rapid increase of homeless women in their 50s, 60s and 70s in Australia right now. Living in cars. One women can't wait until she can get her super in 2 years time so that she can buy a van so she can finally get a good nights sleep.

How did it come to this for a wealthy country like Australia?

indo-dreaming's picture
indo-dreaming's picture
indo-dreaming commented Wednesday, 23 Aug 2017 at 5:05pm

I wonder how much the changing of the family unit has changed things?

I mean going back to 50, 60, 70 s it was more common for families to have one breadwinner, but now unless you have very good job, you really need two family members to be working to be able to afford to pay off a mortgage.

I think there is so man different factors that have all pushed up house prices to unaffordable levels.

Ada gula, ada semut!

braudulio's picture
braudulio's picture
braudulio commented Wednesday, 23 Aug 2017 at 5:24pm

@indo-dreaming, agreed, when I was a kid only dad worked. Same for pretty much everyone I knew.

Nowadays we've both got to work, as do most of the people we know. And we rent, just thinking about buying, even if we could find the deposit (which is a moving set of goalposts), gives me a headache.

As for why house prices are rising ... can't find the emoji for grinding teeth. Again just thinking about negative gearing, capital gains, foreign investment and just plain greed gives my headache a headache.

Ahh, bugger ... I'm off for a Bex and a good lie down.

‘IF YOU UNDERSTAND, things are just as they are;
if you do not understand, THINGS ARE JUST AS THEY ARE.’

Blowin's picture
Blowin's picture
Blowin commented Wednesday, 23 Aug 2017 at 6:11pm

Move up the coast and mow lawns , Braudulio.

You'd be better off....and the lifestyles better .

braudulio's picture
braudulio's picture
braudulio commented Wednesday, 23 Aug 2017 at 7:51pm

Mate, I'd be off tomorrow if I could. BUT, the better half's job means that's unfortunately not an option, and she earns a lot more than me.

Besides, I've seen the size of some of those lawns up your way.

‘IF YOU UNDERSTAND, things are just as they are;
if you do not understand, THINGS ARE JUST AS THEY ARE.’

Purplepills's picture
Purplepills's picture
Purplepills commented Wednesday, 20 Sep 2017 at 10:53am

Wish we had TV presenters like this in OZ....

both barrels for NZ govt failure sounds like Syd and Mel.

http://www.newshub.co.nz/home/election/2017/09/shame-on-those-that-let-h...

Herc's picture
Herc's picture
Herc commented Wednesday, 20 Sep 2017 at 11:01am

'Wish we had TV presenters like this in OZ....'

Yeh, see!!! Fucking Gaul!!! Knew it!!! And I spose you'll get the fuck'n job!!! Again!!!

Shatner'sBassoon's picture
Shatner'sBassoon's picture
Shatner'sBassoon commented Wednesday, 20 Sep 2017 at 6:48pm

Glorious Strong Leader™ has got a prior engagement.

It's time to get stinky, ya'll.

cd's picture
cd's picture
cd commented Saturday, 7 Oct 2017 at 9:34pm

Seems well priced and close to a variety of options
https://www.domain.com.au/53-the-jack-smiths-lake-nsw-2428-2013909407?to...

Blowin's picture
Blowin's picture
Blowin commented Wednesday, 11 Oct 2017 at 4:33pm

Denial is over.

Now it's an open desire that the influx continues.

https://www.domain.com.au/news/chinese-buyers-of-australian-property-set...

I like the line where it says that the governments hands are tied and they're powerless to prevent it.

GuySmiley's picture
GuySmiley's picture
GuySmiley commented Wednesday, 11 Oct 2017 at 4:39pm

After mining the biggest lobby groups are those for property.

Australia the country where everything is for sale ... minerals, water, environment and property.

Same as it ever was since 1788.

tubeshooter's picture
tubeshooter's picture
tubeshooter commented Thursday, 12 Oct 2017 at 9:32pm

You forgot to include politicians and the media in the for sale section.

stunet's picture
stunet's picture
stunet commented Friday, 13 Oct 2017 at 12:04pm

I was talking to my old man about the foreign ownership thing, something he sees as pure folly. He worked in the Lands Titles Office for years, then in various overseas projects for years afterwards. To a tee his hosts couldn't grasp why Australia sells its land off to another country, and not just private real estate but commercial interests too: farmlands, infrastructure. Madness.

Two points he made. One, the Japanese once bought huge swathes of urban land on the SE seaboard - anyone recall the proposed Multifunction Polis? - only to sell it all when the Japanese economy burst in the early 90s. Happened that they bought all the land at the top of the cycle and sold it at the bottom and Australians did fairly well out of it.

Second point is that unlike natural resources, our land isn't going anywhere. Not sure how it could be wrested back without incident, but the possibility exists that point one could lead to point two - a collapse of China's economy means the real estate falls back into Oz hands.

indo-dreaming's picture
indo-dreaming's picture
indo-dreaming commented Friday, 13 Oct 2017 at 1:17pm

Or falls into other overseas investors hands who see a good bargain.

That link of Blowin's is pretty crazy 87% of foreign buyers from China

And Indonesia the third biggest buyers at 1.5% and the funny thing about that is, i bet somewhere between 60%-90% of those Indonesians would be Indonesian Chinese as although they make up about 2-3% of Indonesias population it's estimated by some they control up to 60-70% of Indonesias wealth.

Ada gula, ada semut!

Blowin's picture
Blowin's picture
Blowin commented Friday, 13 Oct 2017 at 1:32pm

I view the selling of land and infrastructure to foreigners as the single largest fuck up of Australia's government in our history.

indo-dreaming's picture
indo-dreaming's picture
indo-dreaming commented Friday, 13 Oct 2017 at 1:40pm

Yep and one area countries like Indonesia have got things correct.

Land/housing should only be able to be purchased by Australian citizens at best only strata type tittle should be able to be bought by non citizens.

Or land be available as long term lease with a maximum land size of say 1,000 m2

Ada gula, ada semut!

happyasS's picture
happyasS's picture
happyasS commented Friday, 13 Oct 2017 at 9:01pm

agree blowin, but not just foreigners....baby boomer investment buy-up has been huge too. in reality bigger than overseas buyers. i love my olds, but they are as much a part of the problem as anyone. sad really....owning a home was once the australian dream. and now home ownership has less to do with 'a home' and way more to do with wealth creation to the point where the property market is now too big to fail, it cant fail, the govt wont let it.

theres plenty of opportunities indo, like you suggest. the govt increased taxes on foreign buyers but it really hasn't had a much impact and as blowin's article points out as has previous articles from more than a year ago; the worlds big banks think australia's property market is a pretty 'solid bet'. if we've tipped the scales too hard in one direction its really really difficult to correct. the effects on young people mortgaged to the hilt and at risk of default if markets change could be with us for decades now even if real govt changes are made today.

velocityjohnno's picture
velocityjohnno's picture
velocityjohnno commented Saturday, 14 Oct 2017 at 12:26pm

Blowin & Stu's dad good comments. Look at 1971, Aus and Canada highest standard of living in world, were sovereign, had resources, agriculture, and value adding. Product of the (economic and actual) nationalist Curtin thru Menzies governments. Big nation building, think the Snowy or the Telecom copper infrastructure or the opening of farms from KI to northern WA wheat belt. Housing cheap, land not strangled by regulation in its takeup. All of the actual physical requirements for this lifestyle still exist, perhaps except within the 2 big cities now.

The leaders of that war and post war era were the young adults who saw what happened to Jack Lang when he refused the London banks calling in their loans in 1932. They were economic nationalists.

Mid 70's Lima agreement to ship manufacturing offshore was part of a parcel of agreements and policy changes; that has almost come to completion, Holden set to shut in 3 days. So many gone before it. No value-adding means a higher trade deficit as you import what you used to make here. Also means less real productive jobs, incomes and career paths for the young. Trade deficits funded by selling bits of the nation off, like farms so there goes the agricultural richness. Living standard decreases.

This real productivity has been replaced by FIRE.

This will need to be addressed, but perhaps it will take a large conflict to see political change. If you look at Trump/Bannon's intentions, from the 1990s interviews onward or Farage and Brexit, it's economic nationalism - putting their country first. It gets painted in so many other ways, but it's economic nationalism. And it's exactly what the mercantilist trading nations to our north have practised since the 1960s or so, and one reason why they are winning.

velocityjohnno's picture
velocityjohnno's picture
velocityjohnno commented Saturday, 14 Oct 2017 at 1:45pm

http://www.smh.com.au/business/holden-assembly-workers-despair-as-last-a...

happening in real time. Ironically, captcha asked for 'cars'

Blowin's picture
Blowin's picture
Blowin commented Saturday, 14 Oct 2017 at 2:16pm

Comments after the article are worth reading.

The post - nationalists amongst us would do well to consider how the society we call Australia will fair if we ever run afoul of the unabashed nation- states such as China when our technological , engineeringing and trade skill sets have been relinquished as non essential cultural artefacts .

Purplepills's picture
Purplepills's picture
Purplepills commented Monday, 16 Oct 2017 at 8:12am

Shows the banks real position, interesting times ahead.
https://theconversation.com/vital-signs-the-spooky-mortgage-risk-signs-o...

stunet's picture
stunet's picture
stunet commented Monday, 16 Oct 2017 at 10:13am

Breathtakingly cavalier attitude by Westpac and ANZ, and I guess all of them really, issuing 40% of their loans as interest only.

Doomsaying get a bad rap but it's hard to avoid the inference that this is the architecture of a fall.

In hindsight, the danger of US sub prime lending was glaringly obvious. Can say the same about this.

GuySmiley's picture
GuySmiley's picture
GuySmiley commented Monday, 16 Oct 2017 at 2:02pm

Yeah, that is staggering more so given recent statistics showing (was it) 1/3 of all borrowers lied about their financial position when taking out the loan so they could borrow more.

The other issue at play here is the stagnation of wages and the increasing casualisation of employment (without penalty rates). How will people ever be able to repay these amounts?

...... I would love to know the amount of funds invested in housing from SMSFs**, if it all goes pear shaped the effects will be felt for decades as the upper and middle classes find themselves having to live on welfare.

** it was Howard that allowed SMSFs to borrow money for investment purposes. It is interesting too see Australia's historical housing price graph while noting the date prices started rapidly increasing and how that date co-incided with Howard's changes.

Blowin's picture
Blowin's picture
Blowin commented Monday, 16 Oct 2017 at 5:17pm

Not just SMSFs , but the 4 banks make up over 30 percent of the ASX. Good luck to the retirees when their superannuation gets caned if the banks get into a spot of bother.

But really , that's just more specifics . The whole arse will fall out of the economy.

GuySmiley's picture
GuySmiley's picture
GuySmiley commented Monday, 16 Oct 2017 at 7:39pm

that's all true blowin but my point was about Howard's decisions / policies that have caused an exponential explosion in house prices / speculation. firm believer in sheeting home responsibility to where it belongs

happyasS's picture
happyasS's picture
happyasS commented Monday, 16 Oct 2017 at 8:02pm

john howard on chinese investment....

https://www.commercialrealestate.com.au/news/dont-use-rising-property-pr...

yet he fails to mention that budding retirees are/were one of the biggest drivers of house prices. something he has very clearly contributed to.

https://www.theguardian.com/business/grogonomics/2013/sep/30/housing-bub...

"...60+ year olds doubled their number of property investments in the 10 years from 2004 to 2014"........well that a pretty good effort.

http://www.smh.com.au/business/the-economy/loan-clampdown-helped-cool-ho...

i very nearly gave up after 7 catpchas.

indo-dreaming's picture
indo-dreaming's picture
indo-dreaming commented Monday, 16 Oct 2017 at 8:07pm

All governments are to blame Liberal and Labor wasn't it Labor that brought in negative gearing?

Not that I'm complaining i feel so lucky to have house worth double my mortgage.

Ada gula, ada semut!

GuySmiley's picture
GuySmiley's picture
GuySmiley commented Monday, 16 Oct 2017 at 10:04pm

Negative gearing is only part of the story.

Allowing 1/2 CGT on investment gains (Howard) "on top" of any negative gearing benefit "on-top" of allowing SMSFs to borrow money (Howard) turbo-charged the housing speculation frenzy.

Allowing losses on investments to be off-set against income from other sources or financial years (negative gearing) is a long established taxation principle here in AU and overseas that well and truely predates the Hawke/Keating years. The Hawke government did allow negative gearing on housing (against Keating's advice) against wage income whereas prior to this decision property losses could be offset against future property income or profit (i.e. quarantined to property).

Its my guess that if negative gearing were to remain but 1/2 CGT and allowing SMSF to borrow funds in property were to be abolished property prices would more than likely collapse.