La Vida loca

Will get worse I feel, you will see them figures increase to -20% reduction or alignment.

northernlights

US house prices took about 16 months to fall 9% then another 6 months to fall a further 20% (not exact figures but can't be arsed to figure out).

Reckon Australia is 6/12 months lagging the US and falls will be accelerated in about 6 months time, especially when property investors see their equity diminishing and want to take any profit.

Lets see if it's any 'different' here.

La Vida loca

Well I viewed a few homes at wkend, all tennants with landlords selling up, Northen burbs of Perth.

northernlights

I've noticed the same in certain, lower end priced suburbs. There seems to have been an influx of homes for sale in the last few weeks. I feel they've missed the boat as sales are definately slowing since last week.

I'm sure that the landlords realise that when the FHOB is taken away, their house price will plummet. Even if the FHOB is here to stay, there cannot be an infinite supply of First Home Buyers and banks are definately tightening up their lending criteria. It's very sad that a measly extra $7K has caused a mini boom at lower end. Just shows how unaffordable the market has become and how little savings people have.

As for the higher priced end of the market, these homes have been up for sale since October/November 08, the stock market crash. Paul Tonich (Altitude real estate director) has had his City Beach home up for sale since October which he is 'reluctantly' selling. He bought it for $4 mill in 2006, it's now up for $4.3 mill, after no takers at $5.25 mill previously. Must of paid $200K+ on stamp duty? It makes you wonder why he is selling, perhaps his Real Estate company is not going so good or perhaps he knows the score, get out while you can as it's gonna get worse.

It will get worse if the Australia budget deficit blows out and Australia get down graded on it's credit rating.

We live in interesting times.

sj oldfield

Prices will pick up again. I recall the same thing happening in the early 90's.

northernlights

The difference between the 90's and now is that house prices v earings were a sensible 3.5 times income compared to 7/8 now. Are you talking about UK or Australia? I had a house in UK and was in negative equity for 7 years, bought in '91, interest rates went up to 17%.

Houses back then were an asset to live in, not a vehicle for wealth making as they've become today.

sj oldfield

Houses back then were an asset to live in, not a vehicle for wealth making as they've become today.[/QUOTE]

Property has always been an investment, as long as you are not wanting a "quick buck".

sj oldfield

I had a house in UK and was in negative equity for 7 years, bought in '91, interest rates went up to 17%.

But they still recovered after a number of years, which they will do so again

nigel and wendy

but didnt mr brown say "no more boom and bust" a while ago ?

northernlights

But the moral of the story is 'timing is everything'. In hindsight, I would of been better off saving and staying with my folks and bought at a later date.

I believe that anyone NOW entering the market will have to wait DECADES for capital gains (real) in house prices. As I said, when interest rates went up to 17%, I could afford the mortgage repayments beacuse I borrowed less than 3 times my annual salary. Unfortunately, many new mortgaged up house owners will be stuffed if rates go up to even 8%.

I do hope that you're not one of the ' house prices double every 7 years' believers?

nigel and wendy

+1
agree with evrything you`ve said so far.

the banks need regulation again,it has to happen,3x your salary is sensible.
trouble is house prices will have to come down to those levels.

so........is this the begining af a price crash ?? who knows........i have real ones not crystal

keel

When will the next unemployment figures be released?

Then we will have a better idea of how the economy is performing. If it has followed the last few months figures then I think Mr Druit will be shown to be a lying TwaXt. You can only talk up something so far what he is doing is criminal.

Keel

eugene43

Keep that believe there & it might happen but for me I hope they keep on falling as it will balance out the loss in uk. Idealy uk prices rise while perths keep falling which by the look of it might happen. I know it is a selfish piont of view but someone has to win so why not me.

IvanM

Property goes up, property goes down. The cycle goes on.

I believe it was 93 the recession peaked and properties bottomed out. The bottom of the market had been called a number of times from 1988.

Negative equity only becomes an issue when you need to move and need finance or you are made unemployed.

Main thing is to buy within ones means and for the right reasons.

nigel and wendy

correctomondo ........and if your young (ish) work like a bas*ard and SAVE UP