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Old Nov 28th 2010, 2:11 pm   #1
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Default The Great Australian Property Swindle

Interesting, but depressing read.

http://www.dailyreckoning.com.au/rep...ty-swindle.pdf

The bubble is starting to burst.

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Old Nov 28th 2010, 4:30 pm   #2
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Default Re: The Great Australian Property Swindle

1. That's just one opinion.
2. Was posted September 2009, its nearly 2011.

However, the report makes sense, people can't borrow much more than they earn unless theres international faith that the market can maintain growth. Australia doesn't have this at the moment, will be awhile before it returns. The gov must work hard selling the idea that Australia is the place to be to fix this. If China stays strong hopefully the gov can ride stagnation for a while. Stagnating housing after so many years of growth is tough going though, I'd say the gov has got 12 months at best to convince the world we're rocking.
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Old Nov 28th 2010, 4:41 pm   #3
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Default Re: The Great Australian Property Swindle

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Originally Posted by lumpommer View Post
Interesting, but depressing read.

http://www.dailyreckoning.com.au/rep...ty-swindle.pdf

The bubble is starting to burst.

bang
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Old Nov 28th 2010, 5:31 pm   #4
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Default Re: The Great Australian Property Swindle

an emotional claptrap report by an unknown author with underlined and bold ittalic words
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Old Nov 28th 2010, 5:47 pm   #5
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Default Re: The Great Australian Property Swindle

Aussie property is a ponzi scheme once it starts to collapse the whole lot will go.

I would be looking to sell now if I had property.

I feel that in a couple of years house prices will have fallen by upto 50% of their curent value.

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Old Nov 28th 2010, 6:24 pm   #6
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Default Re: The Great Australian Property Swindle

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Originally Posted by lumpommer View Post
Aussie property is a ponzi scheme once it starts to collapse the whole lot will go.

I would be looking to sell now if I had property.

I feel that in a couple of years house prices will have fallen by upto 50% of their curent value.

scare mongerers have been saying that for 20 years. I've never lost money on property yet.

Its not cheap to buy but then neither is it to rent. I'd rather put my money into bricks and mortar than piss it up against the wall
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Old Nov 28th 2010, 6:41 pm   #7
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Default Re: The Great Australian Property Swindle

The interest on a mortgage is just as much "dead money" as rent.
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Old Nov 28th 2010, 6:43 pm   #8
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Default Re: The Great Australian Property Swindle

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I feel that in a couple of years house prices will have fallen by upto 50% of their curent value.

This has already happened where I live in the USA on 2007 prices.
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Old Nov 28th 2010, 6:50 pm   #9
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Default Re: The Great Australian Property Swindle

Which ever country we live in the market will fluctuate based on economic variances.

Buying houses should be something in the long run not a short term investment.
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Old Nov 28th 2010, 7:24 pm   #10
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Default Re: The Great Australian Property Swindle

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Originally Posted by sonlymewalter View Post
Which ever country we live in the market will fluctuate based on economic variances.

Buying houses should be something in the long run not a short term investment.
Finally some sense

Sure the right person in the right place at the right time can get a cracking investment that leads them to riches within 3-4 years,
but the global economy is going to be fluctuating for possibly 20-30 years and buying a property for investment purposes needs to be done on a long term basis or alternatively buy abroad or renovate...

I've been looking at properties the last few months, now is a fantastic time to buy in the UK because nobody else is! there are plenty of people eager to sell, and although prices could go down in the next year, over a 5-10 year period I'm pretty confident that a house here could provide a nice little return (although probably not the sort of return people would have had 10 years ago).

On another note, the US economy is still struggling and buying property in the states could provide some fantastic opportunities. I've seen lovely 3/4 bed villas in florida on realtor.com for as little as £50k... I'm sure a good buy would bring an investor a 50% if not higher return over the next 10 years as the economy there begins to pick up.

If the Oz property bubble pops then it can be a good thing - there could be a lot of bargains going around, and people who don't want to lose out on a sale will just have to stay put until the market picks up again.

I'm not an economist, but every problem is an opportunity in disguise and there's plenty of them out there for investors to work on!

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Old Nov 28th 2010, 8:04 pm   #11
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Default Re: The Great Australian Property Swindle

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Originally Posted by sonlymewalter View Post
Which ever country we live in the market will fluctuate based on economic variances.

Buying houses should be something in the long run not a short term investment.
There going down down down down
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Old Nov 28th 2010, 10:58 pm   #12
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Default Re: The Great Australian Property Swindle

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Originally Posted by sonlymewalter View Post
an emotional claptrap report by an unknown author with underlined and bold ittalic words
Unknown to you.
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Old Nov 28th 2010, 11:01 pm   #13
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I'm not an economist, but every problem is an opportunity in disguise and there's plenty of them out there for investors to work on!
I'm with you on that one. The time to buy is when everyone thinks you are crazy to do so.

Could be some great bargains if there is a crash.

...and everyone will be calling us "vultures"
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Old Nov 29th 2010, 12:12 am   #14
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Default Re: The Great Australian Property Swindle

Why do commentators often use examples like this? Surely this person shouldn't be able to afford the median house?

"Let’s say a young median wage earner convinces the bank to lend him the money to buy the median house... He has the following capital to put up:

- 14,000 First Home Owners Grant from the government (expires September 30th 2009)
- $31,000 gift from generous parents totalling a 10% deposit to lodge with the bank

Like tens of thousands of Australian home buyers, he has no savings of his own...

...

To live the same “Great Australian Dream” his parents did, the average Aussie is buying a house that
costs over SEVEN times his salary, and spending well over half of his take home pay to service the home
loan.
"

Last edited by fish.01; Nov 29th 2010 at 12:14 am.
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Old Nov 29th 2010, 12:46 am   #15
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Default Re: The Great Australian Property Swindle

Quote:
Originally Posted by fish.01 View Post
Why do commentators often use examples like this? Surely this person shouldn't be able to afford the median house?

"Let’s say a young median wage earner convinces the bank to lend him the money to buy the median house... He has the following capital to put up:

- 14,000 First Home Owners Grant from the government (expires September 30th 2009)
- $31,000 gift from generous parents totalling a 10% deposit to lodge with the bank

Like tens of thousands of Australian home buyers, he has no savings of his own...

...

To live the same “Great Australian Dream” his parents did, the average Aussie is buying a house that
costs over SEVEN times his salary, and spending well over half of his take home pay to service the home
loan.
"
Anybody buying a house for 7 times their salary is a *****ing idiot. If you can't afford something, you shouldn't have it irrespective of how much money a bank is willing to lend you.
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