House prices
From what I read above you prefer recession over this. I don’t. Recessions are not fun and neither is a depressed property market. The last thing I want is seeing abandoned buildings around our cities, a sight so common in many other countries.
There’s obviously need for balance as things can go too far either way. Timing is critical. For example, there’s time to increase the taxes and there’s time to lower them. We need agile decision makers who are not driven by ideology but by determination to make right choices based on the context that’s surrounding them at any given time. So yeah, now is the time to balance things back to some sort of ‘normality’. I’m not sure what will happen though, I guess we’re learning every day.
I prefer JOMO.
Joy Of Missing Out.
donweather wrote:mowgli wrote:Exactly. All the psychological research concerning wellbeing/mental health says...it does not.
Nor does being really poor, living on the street, being economically insecure.
As usual, the best answer lies in the middle.
Re. interest rates, Lyn Alden's latest post provides some additional context for those claim that all this inflation came from years and years of low rates. In a nutshell, she's saying not really. The low rates mainly just inflated asset prices. Things went awry when money was put directly into hands of the person on the street at the same time as supply constraints (not because of, though) and then the Ukraine war (energy crisis) threw fuel on what was looking like a genuine transitory little bonfire into a big conflagration.
Everyone keeps throwing "fuel prices" into the inflation mix, but seriously look at the crude oil charts, we're currently not that far off the Oct 2018 prices, in fact we're all but 12% off these, so on average, that would place CPI on fuel at under 3% price rise per year. Hardly exorbitant or rampant inflation on current fuel prices. begs the question why the fck we're currently paying over $2 a litre at the bowser then doesn't it!!! Someone's making record profits!!!
Oh and fuel prices in Australia in Oct 2018 were under $1.70 a litre at their max cycle, under $1.45 on their low cycle.
Well that's because they're factored into inflation as a good/service. Though my point wasn't where oil prices are now, but rather where they were 6-12 months and that it was that which lit the inflation conflagration (a lot of flack is being levelled at Biden's/Dem's infra omnibus but I'm yet to see anyone clearly state how much of that has actually flowed down to ground level or whether it's used as red herring). Where they are now suggests, and is backed up by lead indicator figures across a number of metrics including oil, suggests to inflation falling. The issue appears to be that prices paid at the register haven't yet and those are also factored into the RBA's calcs. And unfortunately, as the ABC finally pointed out (for only the second time I've seen) this week that it's big business that hasn't passed on the cost input decreases into RRPs. That plus the "interest rate cliff" make me wonder why the RBA is still so aggressive in it's rhetoric. If gsco is right and Lowe et al. truly are big brained, objective-minded boffins with big fancy models just following the law (i.e., their legislated remit), then one can only conclude that the aggressive rhetoric is just that; rhetoric, designed to trigger behaviours akin to more rate rises without actually raising rates.
What's interesting about this and is lost in all the convo re. the RBA (offensive, defensive, etc.) is that compared to decades gone by, the general public, with perhaps some payments for subscriptions, can access quite a lot of the same data the RBA does and thus develop their own, at least somewhat, reasonably-informed conclusion. Keeping in mind the RBA deals in macro-economics... known as "the terrible science" i think? Or as Nassim Taleb calls it "macro bullshit".
very good.
agree on that Mowgli, all eyes on services and if inflation becomes sticky there
I'm genuinely interested in the "which generation had it better conversation (no emotion). I think every generation can probably find points to express they are/were hard done by and have been ripped off but in the end I think time is what matters.
The silent generation went through 2 world wars, 2 pandemics, cold war, cuban missile crisis, vietnam, korea, Iraq, Iraq again, Black Friday, 70s oil crises and stagflation and the resulting interest rates of the early 80's. The 90's recession we had to have, Twin Towers, GFC, Housing bust associated with GFC...but they also went through the roaring 20s, the population and economic boom post WWII, Glass Steagal and fractional banking - the credit boom, the 80's Greed is Good boom, the dot com boom, the post GFC interest rate repression boom, the post covid even bigger interest rate repression (TINA) boom and here we are......
The thing is, this is only 100 years of time. In my generation and your generation - we will benefit too, you have to believe that; no one really wants anyone to fail financially although it may feel like that sometimes.
If you are in your 30s then you missed the dot com boom - I did too and I was financially capable of taking part but my home loan was so fucking huge (700k) and my interest rate was 7% so I didnt. But then the boom came and between 2003 and 2007 there was this golden opportunity - you could have made out there like a bandit no ? Then came the GFC - if you sold (many did and ended up living in Caravan parks some) you lost, if you didnt and ignored the noise......along came the next boom, the mother of all booms - interrupted by our response to Covid but that was no reason to sell.
So anyone over the age of 18 has been in several booms and benefitted from low interest rates, I cant see why people are complainining - your choices are your choices, the opportunities have been there; just hang in there.
The opportunity of a lifetime comes at least once a year.
You can't see why people are complaining? i thought mowgli laid it out:
inequality. its worsening.
low interest rates mean bugger all if you can't front up the entry ticket.
Gold Coast Home mortgages are loaned at 20-30 years (Recent talk of upping that from 25-40 yrs)
Gold Coast Weekly Rent typically aligns to paying weekly rent for shortest loan terms of 20 years.
Represents fairest rent payment window for both renter & Landlord.
Simply what the Bank needs in shortest contracted time...
No one ever told tbb this...just a life hack that Goldie Hodads can work out.
Example...$200wk Rent for $200,000 Home/loan > $500wk Rent for $500,000 home/loan.
tbb is happy to share Home truths if it helps the crew...but also coz of recent wild price variations!
Living smack bang centre of fastest growing city centring Oz East Coast.
Pink FJ bottlenecks the whole of Oz here each M1 peak morning & arvo commute.
World comes to a standstill at Reedy Creek for half an hour twice a day...(3 Schools / Station)
2007 tbb purchased the lowest price range SEQ townhouse $235,000
Not for price but for 1km walk to intercity Train Station...prefer to catch train to Bne.
Surrounded by 3 Churches & Christian schools but sent Kids to 5km afar state schools.
tbb had renters until their lease expired & Rent was set at $240 wk (See above / below formula)
The neighbours rented their Townhouse on 6 monthly leases...(More new neighbours over time!)
Meaning each renting neighbour could not afford next increase each rise in affordable neighbourhood!
The rent always rationed the current price on 20 year loan repayment but was harder to meet each rise.
Each neighbour spent less time from 3yrs > 2yrs > 1yr > 6mths > 6mths > 6 mths > 3mths...
Eventually the owner moved in then sold to another current owner...all tbb's friendly neighbours!
2007 = 13/15 were rentals > 2023 = 1/15 is a rental in a once low cost affordable rental Complex.
Similar pattern throughout other stages.
Owners wall up, shutter up & spend up on security & seldom associate with neighbours...
tbb knew most now only on a need to know or a few at the pool!
Once visited several homes often thru the week now very few dare risk saying hello!
Still wave at most, just to pretend to be neighbourly...that's still allowed!
Here's the price scale for a taste Utopia.
Year > Rent wk > Sale Price
2007 $240 wk = $235,000
2010 $300 wk = $300,000
2014 $400 wk = $400,000
2017 $500 wk = $500,000
2021 $600 wk = $600,000
2022 $630 wk = $630,000 [SOLD] By nearby neighbour this Month
Recap : These were once amongst the cheapest 3b Town Houses in SEQ
tbb could now sell his 30y/o Townhouse & buy 2x new 3b Brisbane Townhouses
That's not the half of it! (All Pay $5,000 yr / Body Corp)
Our complex has 3b Town Houses > 4b Duplexes > Road side Houses > Tri level Terrace Houses
$630 Town Houses > $850,000 Tri Level Houses (Most are sold refurbished)
tbb's is lower end (Not refurbished) Preferring to get ahead on Mortgage!
Xmas 2020 Tri Level House [SOLD] for a record $600,000 (All were amazed!)
Xmas 2022 Tri Level House [SOLD] for a record $850,000 (The very same house > No extra cushions)
Again...that's nothin...check this...(All of these price ramps are in tbb's complex!)
Just this week tbb lost some good Kiwi neighbours that rented a Duplex.
Their rent just ramped from $480 wk > $840 wk...(Reflecting above Max $840 Complex Home Price)
Kiwis left & immediately applied for a home loan & now live in Coomera, New Zealand.
NZ is a suburb on the Northern Gold Coast...just in case yer wondering.
So what can we learn here...
We can value above Duplex rent $750 wk = $750,000 ($840wk = $850,000 Tri Level Terrace Houses)
So why the blatant $100 Peak Value add for the Duplex Rent?
tbb must answer that with long term local knowledge
Qld renters (tbb) copped similar near double ramped Rental increases at certain times in history.
Bne Com Games > Bne Expo > GC Com Games > Brisbane Olympics (Biggest & right Now)
However! Recall tbb said he could sell his unit & buy 2 elsewhere in SEQ (So not yet really that!)
Here's another curved ball that is smashing thru Religious Neighbourhoods & few will pick this...
Goes against everything each Govt has taught us...Public schools are actually losing students..
Aging parents generally have less healthy offspring so altogether isolate leading to bullying.
Now a ten year gap for today's parents than previous generation.
Older parents are wealthier and can afford to cotton wool their offspring in expensive private schools.
Private schools can isolate offender & Wealthy parent can withhold fees until Bully is disposed of!
Wealthy older parents will buy within a skip to school to bypass Bus Stop Bullies.
tbb can vouch their is an increase of Parents walking their child to school...just in case!
Local Real estate agents confirm that Walking distance to Private schools is the #1 drawcard.
tbb lives within walking distance of 3 > Grade 1-12 Private Colleges...perfect for aged wealthy parents.
A sea of Wealthy aging Parents will pay anything to escort their precious Cotton wool kid to school.
Also perfect for mass influx of teachers & cleaners of these schools...meet our new neighbours.
Add 10-20m onto traffic freeze as Reedy Creek private schools are growing faster than the kids!
Ya see that crew...not even on the radar but tbb lives in such a weird Cotton Wool world.
Even the town talk is of Bully Headmaster vs Bully parents...all of that is our community.
Custom Parental delay is the #1 real estate rising above previous healthier younger faster wage rate!
Wealthier aging parents are bankrolling school communities to comfort increasingly fragile offspring.
There is no limit to what they'll fork out...likely about 10x what newlyweds can afford their offspring!
We are living thru the greatest medically assisted price disparity ever in Oz history.
This 10 year generational shift in Parenthood is falsely ramping real estate in posh school communities.
tbb has no doubt that this same demographic is bossing behaviour & access policy for sports & Arts etc.
These same Senior Parents also have financial clout on school boards + the time to run & rule them.
Think of it as the next Power Shift demographic hovering beneath Boomer chairmen privilege!
Just saying we'll be paying for that just as before!
Wow TBB, super interesting.
Great read Basher thx. Watched 4corners last night about the social housing crisis. Working single mums trying to raise a family on their own while living out of their car.
Lucky country under assault from all angles.
I love that post tbb. It's true, I can see many older people pushing prams around. I got my first kid at 28 and twins at 32. So, neither too young nor too old in my opinion. But to give you more perspective, most of my kids' school friends' parents are way older than me. Some are even 60. So, you're definitely correct, you're onto something.
TBB brilliant post, nice correlations there in rent asked/price with the blow offs in rent correlating with big events!
The elder parents cotton wooling is well founded: when our bus stop was egged I was standing behind one of the rugby players and spared. Andrew came in from recess and the teacher berated him (normally sensitive, great at maths) and he replied "The year 10's captured me and camel bit me for the whole of recess," - his legs were glowing. Year 8's were dangled by their feet from the upper stories... bricks were hidden in empty choc milk cartons waiting to be kicked... Save those precious kids!
Flollo experienced that myself with much older parents - had kids at just before 21 and 24. That was normal in the preceding generation. Couldn't relate too much to the older boomer parents, and things were hard early, but now, I wouldn't change it.
OK a bit more of the smorgasbord of econ data: listed cars for sale
https://mobile.twitter.com/AvidCommentator/status/1627560729477009408
Jump up in listings. He points out that it's a tale of two countries in spending/situation
NZ added another 50bps today which puts them at 4.75%. Funny thing is, most of their data is worse than ours ie they’re further down the road re house declines, and have half (yes half) of their mortgages coming off low fixed rates this year. Interesting coincidence - US is at effectively the same rate. UK is at 6.
When compared to Oz, who just went 25bps to 3.35%…
One reason central banks and the RBA have a credibility problem. Their big swinging tool (QE) shoots blanks.
10 years of massive QE and QQE in Japan, burdening the country with huge debt, has proven it to be an ineffective policy (a failure).
Yet with the evidence so clearly shown in the real world - no longer just in Paul Krugman and Ben Bernanke theorising - the RBA inexplicably joined the "QE club" (felt left out, gotta do something) in 2020 and destroyed its balance sheet.
History will be the best judge of QE, it’s a fairly fresh tool and sure, one day people might look at it with disgust. Easy to criticise in retrospect.
But when there is urgency to get something done and big decisions need to be made people usually run away. That’s my experience anyway. Sure, people will have all sorts of opinions. But most are not keen to commit, put an important signature on a piece of paper or provide a direction to hundreds, thousands of people. They don’t want that responsibility.
So, I don’t like many outcomes (from decisions being made) we discuss in this thread. But I always try to think backwards to the decision making moment and see how would I handle it. And when I think like this it becomes very messy and difficult. It’s really difficult to make the right decision most of the time and pretty much impossible to do it every time.
Standingleft wrote:Great read Basher thx. Watched 4corners last night about the social housing crisis. Working single mums trying to raise a family on their own while living out of their car.
Lucky country under assault from all angles.
Paid $83 for 2 small bags of groceries at Woolies today. The increase in prices was very noticeable, I feel for those already at the margins. Australia and its classes are diverging at increasing rates
History will be the best judge of QE, it’s a fairly fresh tool and sure, "
It is not a fresh tool - GFC was 2008. History has judged. Central Bank's own research indicates it is hard to measure the impact.The video above tells the story of a decade of failed massive QE in Japan.
Why persist? Because aside from interest rates,and talk their toolbox is pretty empty.
But they can't say that out loud because when a crisis looms or hits they have be seen to do something.
Wall St and the media demand this and cheer along in awe (or pretend awe).
During covid, it was the direct payments to households and businesses by government that boosted the markets, not QE.
QE gets stuck in bank reserves. If banks won't lend in a risky economy, it stays stuck.
15 years is a very short timeframe. QE was obviously done on a pretty much global level and analysis will be done for many years in the future.
I agree with cash in hands approach, definitely my favorite in any type of crisis. But even then QE was partially used to buy government bonds which secure their cash flows to do such things as payments to the population.
I'm not saying they should continue with it but I'm saying that its full legacy will still be debated for years to come.
Maybe Australia’s most effective macroeconomic policy tool is immigration: when things are going well, increase it, and when things are going poorly, increase it even more..
Hard to argue, close the doors and no new customers can get in.
There's always "nation building infrastructure". Depending on who you ask, you're getting at least double back for every dollar ya chuck in.
We did it decades ago. Alas, another one of those things where every pollie post-Rudd has talked a big game about what they need to do but nobody has the cajones to do it. They're so frightened of the NIMBY response or tor focused on doing it in a way that wins them votes at the expense of project outcomes or how "the other side" will use the budget spend to against them at the next election. Orrrr they do it via PPP with the likes of Transurban so the ROI for the public is worse than non-existent once you lift the covers to see the terms of agreement (but for shareholders it's youuuuu little rippaaaaaa!).
Shame we never followed Norway and setup a proper/effective sovereign wealth fund for all resources (including fossil fuels) that actually functioned for the the betterment of the resource owners (the public). There's graph somewhere showing their revenue from gas and how "in spite of" their "more onerous royalties" the gas majors have not abandoned them.
Re. the QE discussion vs. cash. Looks like a lot of people forget Rudd/Swan opted for to give the handouts to the people and not big corporates (ok, putting Macquarie Group aside) and in this world of neoliberalism Swanny Swanny from the Block/Moreton Bay took the Brownlow home: https://www.abc.net.au/news/2011-09-21/swan-named-best-treasurer/2908654
Yes, yes China boom etc. etc. But still a useful reference point given the EU went for austerity, the US went austerity then switched to QE, and DownUnder went for helicopter money for plasmas, pinkbatts and making babies.
Anywho, my tip is still no more rate increases. But now it's less certain since the RBA may be/begin thinking that if they DON'T raise rates people/markets will think it's them caving to all the pressure and mud-slinging. Gotta appear strong and independent (which is true to be fair).
Behavioural economics is so fascinating...
oh, and one more thing.
I pay attention to the QLD auction clearance rate figure that comes up on the big RE website. I noticed at late FY22/mid-2022 it dropped pretty quickly (gee wonder why) and seemed to hit a floor around the low-mid 30 percents. Until late in 2022 it started to nudge up a bit towards more the mid-high 30s...and looky here it's now in the low 40s...
If I was a RE spruiker I'd be saying "Auction clearance rates have jumped massively, up a third since November. The bottom has clearly been reached! Call now to have a confidential discussion about the RE market in Nambour and how it's actually the next Byron Bay".
Japan's Central bank has bought:
$3,900,000,000,000 (roughly the total earnings of every Japanese citizen's wages for a year)
worth of bonds so far through QE.
Net result?
Their economy is still stuck with the same problems of a decade ago but now with massively larger public debt.
Give it a rest me thinks - it ain't worth it.
mowgli wrote:oh, and one more thing.
I pay attention to the QLD auction clearance rate figure that comes up on the big RE website. I noticed at late FY22/mid-2022 it dropped pretty quickly (gee wonder why) and seemed to hit a floor around the low-mid 30 percents. Until late in 2022 it started to nudge up a bit towards more the mid-high 30s...and looky here it's now in the low 40s...
If I was a RE spruiker I'd be saying "Auction clearance rates have jumped massively, up a third since November. The bottom has clearly been reached! Call now to have a confidential discussion about the RE market in Nambour and how it's actually the next Byron Bay".
The pimps and spivs love talking up "the next Byron Bay".
Would hate to see SW Rocks go the full flog.
https://www.realestate.com.au/news/could-these-idyllic-coastal-areas-be-...
gsco wrote:Maybe Australia’s most effective macroeconomic policy tool is immigration: when things are going well, increase it, and when things are going poorly, increase it even more..
Haha. That’s gotta be tasty bait for the SN exiled he who shan’t be named.
In case you weren’t tacking the piss my view is it’s the shittiest tool ever when looked at cost benefit. Except of course if you own real estate. Endless continual growth policies are becoming increasingly clear how cooked they really are. Plenty of commentary articles and plots that show multiple recent recessions (now?) based on per capita GDP. As is my understanding.
cannot believe chick on the drum the other night sprouting '...iimmigration doesn't increase house prices, immigration doesn't suppress wages...'
can go down totally unchalenged... still... when those that have recently, reluctantly, admitted using it to do just that (phillip lowe and co.) ...have so openly admmitted it does...
parallel universe stuff
also cannot believe benanke getting a nobel prize for quantative easing policies...
(legit. felt like a piss take)
the distance of some from realities of policy is actually quite alarming
re. japan, something I find interesting that is totally overlooked - be it advocating for or against japanese style scenarois - is how bloody hard they work... how many hours they work... and how good a savers they are...
the above is pretty much all that has saved japan and quality of life through this crazy period I reckon, and makes any across country comparisons pretty invalid
I know a family in japan still paying off a million ++ mortgage from way back when... where the house is now worth half that, and the kids will inherit the mortgage...
immigration may have saved us from such scenarios... but what's the point, if kids cannot afford a place to live and single mum families are living in cars?
never thought I'd see the day, where homelessness amongst middle aged women would be such a problem in australia...
abject policy failure
Recapping ...thanx to the crew for replies...just going over that in an ordered way...
$200/wk rent x 50wks = $10,000 x 20 years = $200,000 Shortest Home/Loan (Interest aside)
It's just a base level Goldie guide that carries on thru time...tbb is not aware of other City's gigs!
Not sure if tbb will get away with a second ridiculous Home Loan life hack.
Don't ask why, but tbb factors this in as 10% investment return locked in...(How & Why!)
20 years x 10% = $200,000 > 10years = $400,000...( Said don't ask! ) Always does this & all can see!
Exactly...check on tbb's price chart...it squares up on the nearest dollar it does! Try it anyway ya like!
It is amazing how these simple formulas go unnoticed or unsaid...
Here's how our lifestyle is built around the exact same formula...again...just is!
tbb could claim another few hacks but we're keepin' it simple to move on...let's go!
Meaning the Real Estate doubles in value over 10 years as shown on above table.
Yep! Pretty weird huh & keeps doing that thru time > 10% return is set in stone as Gold Standard.
Soon as Interest Rates hit 10% all properties are sold & all race to secure land banks!
Again... that's another hack tbb picked up in the trade over a lifetime...(Just don't ask!)
Probably why kids got high Maths / Accountancy honours & tbb didn't!
Just saying unless 2x wages are at 5% they fall behind the next 6th month catch up rent payment.
So the standard 2x Adult 5% wage hike pays the 10% annual increase.
Any bonus or savings (eg) Flatmate covers 5% inflation + 5% interest...all very rational.
The 3rd income covers rent during family planing...otherwise, how does the couple become a couple?
Couple commit & the Home Loan is signed & bub is on the way > Flatmate gets marching orders.
Again...these are just oldschool life hacks that ring true for the most part...happy to share!
We are only human...each have a sense of duty to each other, so it sorts itself out!
tbb salutes...Crew are wise to all this but it's now changing fast again.
This brand new upmarket Senior Parent Generation (above post) are quite often single / same sex.
Ok! tbb said it...can't unsay it!
Repeating this gen of parents are 10 years older...amazing!
Stands to reason that these births need expensive med tech & no guarantees! Got it!
Kinda wot tbb was avoiding in saying...coz ya say it wrong each time! Crew know what that's about!
Plebiscite was the "Legal" delay...now the new world is coming on real real fast on every level.
These Parents froze their seed & eggs 10 years back & only now can commit to uncharted quest.
This is all new folks...all around the world...we never once did this in this fashion...A-Z generation
These senior parents re-enter communities as part retired same sex or single parent/s.
Ok! So now crew can see why Elderly wealthy Same Sex parents weird out State School Bullies...Holy shit?
None...Never saw that Tidal Wave rise up...yet Love is all around!
Private Schools can best cushion or even hide this gen of Cotton Wool kids without fear of bullies.
Pause! tbb don't mean to tarnish this next gen...still new to all of us, as is this next shocker...
Private Schools already cater for Senior wealthy parents...crew can see, it's the Perfect Foil.
Here's the irony : Wealthy opposing Parents as a Team (vs) Tolerant Rich/Poor Parents as poles apart!
All about the Money...Money buys peace & happiness > never forget that Gromz!
NSW Govt is rebating $2,000 for IVF for first time 40-50 year parents > soon to be nationwide.
These are them CEO Teals that rule our world & boss policy to accommodate 10 year late arrivals
Tonite : The Voice Labs > Bossed by Kitchen Table Teals...Yes! Exactly...drafting 1st Nation Voice.
No! Not tbb having a crack...ABC reported on hiring the Teals wealth & smarts to calm the waters.
We see this Wealth shift Policy daily in our Politics & Surf Comps & WSL Event news more each day.
Thanx for reading & kind comments...actually felt a bit odd sharing own world but the aim is true!
tbb's family are fine to share more local insight on real life rent rises from about the Goldie & Sunny.
These are all recent as we speak...reckon they will help the crew to see wot sort of push is on.
As said...2032 Olympic SEQ Rent rises are warming up...so we could be livin' in a countdown bubble!
Crew are smart enough to know that Olympics drive out the locals & SEQ will boss that like no other!
Let the Games begin..
Palm Beach Postie was paying $800/wk > rent rose 50% to $1,200/wk (Here's what he did!)
PRD Realty now pays the Postie more for 3 days flyers than Oz Post did for 5 days mail! (All sorted)
Yes! Worth checking out a job as a shit kicking Real Estate high flyer.
Nobby's Beach couple dreamt of upmarket Magic Mountain Rental.
Were paying $550 & forked out $250 extra for upmarket Condo $800/wk rent...
Dream come true!
After their 1st "6 month Lease" Their Rent was increased 25% from $800/wk to $1,000/wk
Dream turned sour...
Can't do the extra bucks...now collared with almost double their rent of 6 months back! Wow!
Can't backtrack to former $550/wk rental...Bye Bye!
Sunny Coast Real Estate suggested bro to increase Rent (33%) from $450/wk to $750/wk.
Won't go into detail but sale was the end game...so no one copped that slab...thank goodness!
tbb's neighbourhood recap was the Reedy Creek Duplex 75% rise from $480 > $840
SEQ current real estate backed rent rises on Goldie > Sunny Coasts 20% > 33% > 50% > 75%
tbb feels for the crew...exactly why this info is being gathered & shared by tbb's Family...hope it helps!
Ridiculous for the World to keep spinning with massive rent hikes beyond all reason.
Ain't no Bank of Govt can sort this lot...blows yer mind how young couples are gonna do this!
Recall 50,000 wealthy southerners just moved to Qld...
Reckon 50,000 poor Qldurrz are gonna get booted south...we're sorry 'bout that!
tbb has a wedding to pay for...comes outta the mortgage & place is run down...no easy run home!
Crew might think it's easy for us Hodads...nope! Reality check...never gets easier!
Bloody tuff for the Gromz & we hodads wanna help where we can...hope oldschool smart sense helps!
"hope oldschool smart sense helps"
Most useful tool in the shed TBB I reckon.
mowgli wrote:"Call now to have a confidential discussion about the RE market in Nambour and how it's actually the next Byron Bay".
I say in jest, mum's fam are from around there...
tbb another excellent post - speaking truth to power with the older parents. Went to a kindy dinner as 20 something parents, were given a brochure by the other parents "How to be a parent," will never forget that. 20+ years later, the parenting results are in and I'd say us youngin's outperformed (or: rather dodged some of the bad stuff that can happen and did to this lot).
Can you explain the maths at the start of your post in a little more depth? I've heard that RE has a recorded 7% gain pa that can be traced back to the Domesday book...
And: there's hope if young. Look at some areas I know of, a young couple can get together and rent a duplex at about $250 a week, there's work and mines around if you want $$$ - buying said duplex is about 200-250K, you can go bigger if you want. This means young couples can get together and with affordable housing, have children at the historical age, when fertility is best.
https://www.news.com.au/finance/economy/interest-rates/cba-accused-of-go...
This one's pure bait, but I can't get past the typology - MSM describing the subject of the article as just 'a boomer'... In the past, they might say 'a Brisbane Man', but now, it's just 'a boomer':
"A Boomer has hit out at one of Australia’s big four banks for causing customers a “huge” amount of financial pain, while it rakes in record profits."
"A Boomer, who owns two properties worth $3 million, has hit out at the Commonwealth Bank for “gouging” customers with skyrocketing interest rates after making record profits — with concerns many homeowners would be in a “much worse” situation compared to him."
I guess the editor had left work for the weekend already?
Those bank profits are obscene. Rather than messing with workers super, how about a super profit tax on the banks.
Read somewhere that every 0.25% increase in the cash rate expands bank net interest margins by around 0.02% which accumulates profit enormously with all the loans they are holding.
Distracted wrote:Those bank profits are obscene. Rather than messing with workers super, how about a super profit tax on the banks.
Read somewhere that every 0.25% increase in the cash rate expands bank net interest margins by around 0.02% which accumulates profit enormously with all the loans they are holding.
The banks have certainly been given plenty of silver spoons since the GFC, that cannot be argued.
But what is also obscene is the suppression of interest rates and government policy tempting people to take out huge loans to afford a house whose price has been ramped by those exact policies - an idiot could have seen the effect of those policies; and I'm sure they knew. Like I've said before; western governments and the Japanese have been busting for inflation for 15 years to wash away public debt; now they have it in spades with more to come. Idiots.
mowgli wrote:oh, and one more thing.
I pay attention to the QLD auction clearance rate figure that comes up on the big RE website. I noticed at late FY22/mid-2022 it dropped pretty quickly (gee wonder why) and seemed to hit a floor around the low-mid 30 percents. Until late in 2022 it started to nudge up a bit towards more the mid-high 30s...and looky here it's now in the low 40s...
If I was a RE spruiker I'd be saying "Auction clearance rates have jumped massively, up a third since November. The bottom has clearly been reached! Call now to have a confidential discussion about the RE market in Nambour and how it's actually the next Byron Bay".
Auction clearance rates don’t signal the bottom is in. If Auction Clearance rates rise they could actually be desperate sellers trying to get out of a dumping market or they can’t afford the huge mortgage increases due to increasing rates. You can’t just look at auction clearance rates in isolation. Also have to look at house price rise/fall.
Chill, Winstonnnn.
Was just takin' the piss.
In other news, His Holiness Ian Lowe admitted that the fancy models they use, and supplied by gsco, are pretty much useless when it comes to factoring in supply-side inflation.... I'm sorry, in the quiet words of the Virgin Mary....come again? Or as the kids say these days... DA FUQ BRO, U FOR REAL!?
So not only has the RBA admitted that their models do a bang up (shit) shop at accounting for supply-side driven inflation, and not only can we all see that is what is driving it a lot, but additional analysis released this week has shown that price gouging above cost input increases by big corporates (i.e., not consumer demand) is responsible for a couple percentage points in the inflation figures AND that supply chain bottle necks and then the war in Ukraine is responsible for another few % points. All up, I saw something saying about 2/3 of inflation drivers are external to Australia so raising rates here will do sweet fuck all. Not only that, but the RBA keeps banging on about wage uplift that despite saying the same thing every year for the past 10 years it has not materialised. So, a great track record they have and I said it a few thread pages ago, if this mob were executives in a business they would've been fired years ago with a track record like that.
All told, the component of inflation actually being driven by consumer behaviour has been shown to be....wait for it.....djembe/drum roll please...... 2.7%.... within the erection inducing range for an RBA boffin...
Oh, what's that I hear you say? Lifting rates will cause people to cut back spending so the big corporates then cut prices? Yeah nah, not me. nearly >50% of our net income is now going to the mortgage. The rest is on food, fuel/car related costs, daycare and utilities. We tried to refinance recently and they didn't believe our costs (excl. mortgage) were so low (dunno wtf people spend their money on). So forgive me for being a bit miffed about interest rate rises that plenty of much smarter and some highly qualified people who've done analysis say all these rises are doing is hurting low-middle income (mostly younger) households and it'll have almost no effect on inflation.
As the folks at Juice Media say: Cool & Normal!
monkeyboy wrote:The banks have certainly been given plenty of silver spoons since the GFC, that cannot be argued.
But what is also obscene is the suppression of interest rates and government policy tempting people to take out huge loans to afford a house whose price has been ramped by those exact policies - an idiot could have seen the effect of those policies; and I'm sure they knew. Like I've said before; western governments and the Japanese have been busting for inflation for 15 years to wash away public debt; now they have it in spades with more to come. Idiots.
The suppression of interest rates (robbing savers) happened for a decade, and correlates to juicing the money supply. Which they've done enormously. Check this M2 chart (select:max) and do a rough estimate on how closely it corresponds to house prices... Check the covid rise too...
https://www.ceicdata.com/en/indicator/australia/money-supply-m2
velocityjohnno wrote:The suppression of interest rates (robbing savers) happened for a decade, and correlates to juicing the money supply. Which they've done enormously. Check this M2 chart (select:max) and do a rough estimate on how closely it corresponds to house prices... Check the covid rise too...
https://www.ceicdata.com/en/indicator/australia/money-supply-m2
Yep - and overlay that with the ASX. Same with the S&P500.
Although the US chart is starting to look pretty miserable. Look out below.
RBA modelling.
If you ever try building any forecasting model you quickly realise that you have to make many subjective judgements on many assumptions. In economics many of these are set by group think and high priest economic theorists.
Also, once you do "what if" scenarios you realise that shifts in variables can produce quite radically different results.
A thousand phd economists at the Fed and the RBA would find the same.
Can they send up radical scenario forecast to their board or publish them or even show their boss?
No. Career suicide.
So they build goal seeking outcomes into the models. They make sure inflation or growth predictions are always within safe boundaries that won't raise eyebrows.
They are weather forecasters predicting based on mean temperature, rainfall and wind speed data using models that will assume roughly more of the same. So they cannot spot storms until they are almost over.
The flaws in their modelling approach are baked into the cake.
bonza wrote:gsco wrote:Maybe Australia’s most effective macroeconomic policy tool is immigration: when things are going well, increase it, and when things are going poorly, increase it even more..
Haha. That’s gotta be tasty bait for the SN exiled he who shan’t be named.
In case you weren’t tacking the piss my view is it’s the shittiest tool ever when looked at cost benefit. Except of course if you own real estate. Endless continual growth policies are becoming increasingly clear how cooked they really are. Plenty of commentary articles and plots that show multiple recent recessions (now?) based on per capita GDP. As is my understanding.
Interesting read - https://www.penguin.com.au/books/australias-second-chance-9780143783640
Came across this very good article on the weekend, by a man who certainly has the runs on the board, and has spent the time at the wicket to know a big change when he sees one:
https://www.afr.com/companies/financial-services/apra-will-hold-home-loa...
APRA will not reduce the home loan buffers after all. That's one of the bailout contenders that won't be happening.
velocityjohnno wrote:https://www.afr.com/companies/financial-services/apra-will-hold-home-loa...
APRA will not reduce the home loan buffers after all. That's one of the bailout contenders that won't be happening.
thats good
gsco wrote:But flollo you're not allowed to state facts anymore, how dare you...!
Nowadays you're only allowed to relentlessly spam and echo a tirade of information warfare and abuse at the RBA, accusing it of being an oppressive, evil champion of neoliberalism and the wealthy elite, of intentionally aiming at causing a recession and entrenching inequality, disadvantage, poverty and suffering, and at bringing the average Aussie battler and all of working class society to its knees, begging for mercy.
You're meant to be arguing that the cause of inflation is excessive profits of greedy corporations, supply side shocks (cost push inflation), and wealthy property investors and baby boomers on a mission to destroy the plebs and serfs. You're meant to be arguing that pent up demand and spending due to a couple decades of ultra low global interest rates and quantitative easing, and due to massive and out-of-control govt covid stimulus globally, actually have nothing to do with it. And anyway, back in mid to late 2021, how on earth did the RBA not forecast that Russia would invade Ukraine and cause an energy price shock - like how stupid and useless can they be...what idiots...sack them all!
You're meant to ignore the fact that the RBA has teams of economic and econometric modellers advising on monetary policy and who actually have a model-based factual, objective, quantitative view of economic and financial conditions when providing their advice. Supposedly these people don't exist, or at least the models they use are no better than tarot cards and palm reading.
You're meant to be arguing that the RBA has no idea about what it's doing, that it's all useless idiots sitting around making stuff up and guessing, and therefore needs an overhaul, starting with everyone being fired, particularly the governor himself. You're meant to be on a witch-hunt and backing a full blown enquiry of the RBA with the intention of completely dismantling it due to its absolute failure in economic policy and management in every way possible over the past 30 years of the inflation targeting era...
You're in fact meant to be blaming all of Australia's economic, cost of living, housing affordability, social, Indigenous Australia, etc...you name it...problems on the RBA. Get onboard...
You're certainly not meant to be pointing out the obvious that the recent increases in interest rates are simply bringing them back more into line with historical levels, and they're still historically relatively low.
That's just plain not woke.
Good 730 report by Kohler tonight gsco….
…what say you
On a good side, these were unimaginable just few months ago
https://www.realestate.com.au/news/national-home-prices-edge-upwards-as-...
Deadcat bounce IMO
More pain to come.
https://thenewdaily.com.au/finance/finance-news/2023/03/01/economy-growt...
&list=PL7vUOWh5dtHN0HL-ckjHLeXfW8vZgo0H8 So it's moving to 2025 now? It seems to be moving every year but nothing ever happens.
"More pain to come."
Jeez don, you should get that printed on a shirt.
flollo wrote:So it's moving to 2025 now? It seems to be moving every year but nothing ever happens.
Did you listen to the whole interview? Recession mid 2023 with a full blown depression 2025 potentially as early as late 2024.
House prices - going to go up , down or sideways ?
Opinions and anecdotal stories if you could.
Cheers