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

velocityjohnno's picture
velocityjohnno's picture
velocityjohnno Thursday, 25 Nov 2021 at 5:25pm

Hey FR, the article was very mainstream, but I did learn that there were wartime price controls on Australian housing (price, rent) until 1949, and that housing doubled when these were removed as the prices returned to the mean of inflation felt elsewhere throughout the war. And, throughout the 19th century house pricing did not inflate beyond a range (Gold Standard might have had something to do with that)

Immigration was also mentioned as a driver for increasing prices, which I thought was a tell, given the source...

freeride76's picture
freeride76's picture
freeride76 Thursday, 25 Nov 2021 at 5:36pm

True.
That was useful information.

velocityjohnno's picture
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velocityjohnno Thursday, 25 Nov 2021 at 8:18pm
Blowin wrote:

+
Highrise Harry celebrates migrant meat for property grinder...

Wow. Betcha if they get the flick the other mob will do exactly the same. Roll on the election anyway.

Patrick's picture
Patrick's picture
Patrick Friday, 26 Nov 2021 at 3:08pm

Latest rental affordability index. Interview with the lead number cruncher:
- social housing has halved over the years.
- short term accommodation reduces rental stock.
- regions affected by people leaving locked down cities.
- rent increases aren't tied to cost of living.

https://www.abc.net.au/radionational/programs/themoney/rents-continue-to...

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flollo's picture
flollo Friday, 26 Nov 2021 at 3:44pm

'Brisbane property prices will start to catch up to Melbourne and Sydney’s regardless of what happens with inflation and interest rates rises.'

https://www.theurbandeveloper.com/articles/brisbane-catches-up-to-sydney...

batfink's picture
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batfink Friday, 26 Nov 2021 at 4:16pm
blindboy wrote:

This has some interesting graphs. Check put the inflation adjusted one.
https://www.savings.com.au/home-loans/australian-house-prices-over-the-l...

I used to do this sort of work, transforming data into pretty pictures so that even someone as dumb as a Senior Executive could understand them.

These are the cleverest damn graphical representations I have ever seen. Smart guy putting them together. Having said that, what can be done these days with software programs has gone ahead leaps and bounds in the past 5 years. It’s all about wrestling with numbers, which very few have the patience to do (and the intelligence, but more the patience) plus software and imagination. Great stuff.

His takeouts were interesting too, but seemed to miss one obvious one. Whatever else, we are a nation, at least since late 80s, that will hock ourselves to the eyeballs for our mortgages. It’s not an enviable trait. It’s also likely to be the case over most of the western world.

Funny how much people are aggravated about ‘government controlling their lives’, while signing their life away to banks, like lemmings to a cliff. (An apocryphal metaphor, lemmings don’t run off the nearest cliff when their population gets too big.)

batfink's picture
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batfink Friday, 26 Nov 2021 at 4:38pm
velocityjohnno wrote:

Are there any savers in the midst? What say you of 1.25% in current inflation environment? I thought so.

So, what response were you expecting there VJ - the ‘thought so’ bit?

Technically I would be categorised as a saver, in that I have money in the bank and no debt to speak of. I’m getting around 1.25% in an at call account. What would/should I do, in your mind?

I know that technically that money is losing value due to inflation. I also know that investing in the sharemarket would certainly make me a lot more money, until it doesn’t and wipes out 20% or 40% in an overnight crash. Or I could invest in housing, but then I get into a world of investment hurt, tax games, more maintenance as though I don’t have enough to do already, probable meetings with body corporates and the insufferable dingbats that infest them, worry about the renters and what they’re doing to the place, or worrying about not having renters, dealing with real estate agents / property managers.

Those things would leave worry lines on my forehead. For every dollar I would make I would be paying $2 in worry.

What would you do if you had a spare $100K? (that’s just a ballpark figure, not my actual savings) You can answer that as a 40 year old, a 50 year old, a 60 year old etc if you want to. I think the answer is easy if you’re 40 or even 50, but what about if you have just turned 60, or 65 (given the batshit crazy investment environment we have at the moment). Where is the threshold for you where that answer changes.

Genuinely interested.

AndyM's picture
AndyM's picture
AndyM Friday, 26 Nov 2021 at 5:57pm

Yep, keen to hear some opinions there.

zenagain's picture
zenagain's picture
zenagain Friday, 26 Nov 2021 at 7:32pm

"Funny how much people are aggravated about ‘government controlling their lives’, while signing their life away to banks, like lemmings to a cliff"

What's the alternative BF?

If I had a spare $100k I'd buy a new board, take my wife on a nice holiday and invest $20k in getting my new business off the ground. The balance ($70k) I would invest in the share market with a mixture of blue-chip shares and relatively moderate to high risk ones as well. I'd re-invest the dividends to compound for the next ten to 15 years.

velocityjohnno's picture
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velocityjohnno Friday, 26 Nov 2021 at 8:53pm

Batfink I would love to do this one as a conversation, I wish there was a way where we could do a respectful discussion of this unique and increasingly insane investment environment that would not cross financial advice boundaries - and is understood so by all involved. Too much for an open forum? Send a PM via Stu if you wish and he's OK with it.

Savers have been completely stolen from since 2008. The profligate have been rewarded and now zoom past in expensive cars. Our economic system permits the accumulation of capital, to be best deployed to be most useful. Or that was how it used to work. My study of history keeps coming back to John Laws' France...

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sypkan Friday, 26 Nov 2021 at 11:15pm

"Batfink I would love to do this one as a conversation, I wish there was a way where we could do a respectful discussion of this unique and increasingly insane investment environment that would not cross financial advice boundaries - and is understood so by all involved. Too much for an open forum?"

definitely not too much!

a heap of us losers (savers) are itching to hear what you've got...

freeride76's picture
freeride76's picture
freeride76 Saturday, 27 Nov 2021 at 6:57am

Let it rip VJ.

gsco's picture
gsco's picture
gsco Saturday, 27 Nov 2021 at 8:50am

Yes would love to hear it. I'm wondering what to do in the current environment. Just clearly state that it's only opinion and not personal or even general financial advice.

san Guine's picture
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san Guine Saturday, 27 Nov 2021 at 9:09am

Go for it VJ,
Us savers need some saving...

AndyM's picture
AndyM's picture
AndyM Saturday, 27 Nov 2021 at 9:13am

Do it VJ.
We always hear that the difference between a comfortable retirement and descending into struggle is owning your own home.
So should we desperately chase home ownership or assuming you’re a good saver, are there better things to do with your money while you continue to rent.
At the moment I’m considering not buying a house but instead buying a few hundred acres of land out in the bush both to visit now and to hang onto for the future.
Thoughts?

AndyM's picture
AndyM's picture
AndyM Saturday, 27 Nov 2021 at 9:14am

..

I focus's picture
I focus's picture
I focus Saturday, 27 Nov 2021 at 9:16pm
zenagain wrote:

"Funny how much people are aggravated about ‘government controlling their lives’, while signing their life away to banks, like lemmings to a cliff"

What's the alternative BF?

Zen If I had a spare $100k I would spend on drinking, gambling and women, the rest I would waste... bom bom.

If I had a spare $100k I'd buy a new board, take my wife on a nice holiday and invest $20k in getting my new business off the ground. The balance ($70k) I would invest in the share market with a mixture of blue-chip shares and relatively moderate to high risk ones as well. I'd re-invest the dividends to compound for the next ten to 15 years.

Zen if I had $100k I would spend on drinking, gambling and women... the rest I would waste... bom bom.

seaslug's picture
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seaslug Saturday, 27 Nov 2021 at 10:05pm

Must be Northern Irish I focus, "I spent a lot of money on booze, birds and fast cars. The rest I just squandered." George Best

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seaslug Saturday, 27 Nov 2021 at 10:06pm

I once said Gazza's IQ was less than his shirt number and he asked me: 'What's an IQ

seaslug's picture
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seaslug Saturday, 27 Nov 2021 at 10:07pm

They say I slept with seven Miss Worlds. I didn't. It was only four. I didn't turn up for the other three.

seaslug's picture
seaslug's picture
seaslug Saturday, 27 Nov 2021 at 10:08pm

In 1969 I gave up women and alcohol - it was the worst 20 minutes of my life.

zenagain's picture
zenagain's picture
zenagain Sunday, 28 Nov 2021 at 12:55am

Me too.

I was 1.

etarip's picture
etarip's picture
etarip Sunday, 28 Nov 2021 at 6:37am

#metoo stories always bring a tear to my eye Zen

Sprout's picture
Sprout's picture
Sprout Sunday, 28 Nov 2021 at 9:27am
campbell's picture
campbell's picture
campbell Sunday, 28 Nov 2021 at 9:37am

Good points Geoffrey .
Working with a young (mid 20s) sparky on a job the other day. He moved to the south west from country Victoria, bought a block in one of the many subdivisions in Margs (still a fair bit cheaper than vicco apparently) built a house and is on his way . Id say he be in around 550 with the house built. That's a lot of money , but in your 20s gives him a long working life left to pay off an appreciating ( hopefully) asset and over time wages / earning potential increase etc, the future for him is bright.
Go hard and pay off as much as you possibly can on a variable rate ( as mentioned above interest only is a mugs game if you want to see the end) any extra you pay is available for redraw if you need it , smash that loan .
I started in the real estate race late ( mid 30,s.long story .too much surfing)but have paid more than double off the weekly payment ever since and have seen a 25 year loan almost nailed in half the time .
I see lots of nurses, cops and teachers being used as examples of the people who cant afford to live / buy anywhere ? Strange example I reckon, they all earn great money and have access to cheaper loans than most of us so not sure about that point ? I am a tradesman and earn a lot less than my teacher and nurse friends that's for sure ( lot less paid holidays too)
Great forum btw , very interesting observations