Originally Posted by folic

http://www.businessinsider.com/vanco...ollapse-2010-7


For those inclined to take such reports seriously (maybe those who're a bit over-extended on their mortgage or who fear their job might disappear within the next 6 to 12 months) the thing to watch is sales in your immediate vicinity

because what happens is, desperate neighbours and others in your region might decide to dramatically drop their asking price

when this happens, their sale-price will become the new bench-mark for your property, like it or not. Estate agents will start your asking-price at your neighbour's sell-price

You may well protest and point out how much you paid for your property. Estate agents will shrug and tell you 'too bad, so sad', and inform you that the market (and not the price you paid) determines the value of your property

If you become stubborn (as well you might) you will sit there watching properties around you selling for a dramatically reduced price. It will seem surreal (especially for those who've been persuaded that 'property always goes up, never down' )

If you remain stubborn and leave it too late, you may well look back at what at the time were the 'insulting' offers you knocked back -- and wish you'd taken the money. Because twelve months on, the offers you receive may be tens of thousands lower again

So keep your eyes on property-sales in your region and surrounding suburbs and if you know you're going to have to get out of your mortgage for whatever reason in the next 12 months -- do it sooner rather than later. Because when property dives in Australia (and most particularly on the Gold and Sunshine Coasts) it has a history of going down to the wire -- and staying there for a long time

Mass migration saved the Gold Coast, which at the time had been in a deep trough for close to 12 years. Migrants pushed up the property prices in the southern cities. People in the cities sold for ridiculously high prices (600,000, 700,000 for jerry-built 2-bedroom slums in many cases, built in the 1920s). The southerners grabbed the money and retired to the Gold and Sunshine coasts and snapped up cheap properties there which had been languishing for close to a decade. Then more migrants bought into the Gold and Sunshine coasts, pushing prices up even higher. Many real estate agents who couldn't afford coffee in the late 90s were able to retire on the easy money brought about by the most recent Qld property booms. Migrants were suckered, in many instances. But with their strong UK Pound, were persuaded they'd won a bargain

It's to be suspected that bubble is deflating fast, despite estate agents and media, etc. claiming there's a 'housing shortage'

Brisbane people are reporting online that 13 or more houses in their streets are still unsold, despite being on the market for close to a year

So keep your eyes open and remember that estate-agents earn their car and mortgage payments from selling properties, as do newspapers (all those real-estate ads .. thousands of them, every day)

It's your life, your future, your money. No-one is going to care about you and your family as much as you do. So don't buy the BS. Do your homework. Watch the actual employment situation. Can you survive and for how long if your job disappears ? Should you sell, downsize or rent until things stabilise, etc. ? Only you know.

And remember, despite the advice about rent being dead money, there is genuine research which claims that unless you're going to live in a place for a minimum of 7 years, then it's cheaper or at least no more expensive -- all factors taken into account -- to rent

Originally Posted by Alfresco

Well looks like I'll be renting my house out here in the UK and rent in Oz and when the market does collapse there, I'll be in a strong position to buy.

I could be buying YOUR house for 50% current value.

Originally Posted by Sally Simpson

I do think house prices in Aus are way too high for the average earnings but isn't the issue supply & demand? There are acute housing shortages in some areas so will this not protect the market to some extent?

Originally Posted by brendarover

ABC Diamond, you post some valuable data on here, and appreciated by me and most, but you are the housing market resident bull. Well in Australia, notibly the Bayside area. I would like to see your response, not a copy and paste, but something hand made by you, outlining why house prices are not falling and why they will not fall in Australia. Its just you seem to argue with all intense and purposes using public data?

Originally Posted by brendarover

Well in Australia, notibly the Bayside area. I would like to see your response, not a copy and paste, but something hand made by you, outlining why house prices are not falling and why they will not fall in Australia.

Originally Posted by Sally Simpson

I do think house prices in Aus are way too high for the average earnings but isn't the issue supply & demand? There are acute housing shortages in some areas so will this not protect the market to some extent?

Originally Posted by ABCDiamond

The highly residential areas of Western Sydney for example, where I have shown that prices have dropped. But the people that argue say that isn't possible, because prices have risen, and have yet to drop. In 2003 a property in 2759 was valued at $430,000, it is now valued at about $370,000.

Originally Posted by iamthecreaturefromuranus

...or, you could sat in a dole queue somewhere because the property market has collapsed and taken the entire economy with it. Of course the doom mongers in this thread will be able to say "I told you so"... from their position in the same dole queue.

For the life of me I cannot see why so many people seem to be wishing that the market collapse's. Yes it will make a house cheaper to buy... but it doesn't matter how cheap it is if you have no job.

I guess those hoping for a collapse are thinking that their job is safe because, as we see so quoted so many times in this thread "it's different here" and they of course wouldn't be effected.

Originally Posted by iamthecreaturefromuranus

My guess would be that, down here in the 'Gong, house prices, apart from one or two areas obviously, have pretty much tracked sideways. A fall in real terms if you take inflation into account.

Originally Posted by ABCDiamond

How do these recent Wollongong sales compare to your knowledge of Wollongong.

$435,000 2/8a Market Pl 3 bed Unit
$548,500 17 Evans St 3 bed House
$650,000 18/60 Harbour St 3 bed Unit
$760,000 23/12 Bank St 3 bed Unit
$835,000 1 Wiseman Av 4 bed House

Median price so far ... $650,000

April Median price $420,000. They need more lower end sales to get that median down

Originally Posted by iamthecreaturefromuranus

Sales in Wollongong itself are only a tiny market and many would be along the sea front and attract decent prices... try Albion Park. It's probably more representative of the larger 'Gong market.

Originally Posted by brendarover

What a great post, not a copy and paste but a post from experience.

ABC Diamond, you post some valuable data on here, and appreciated by me and most, but you are the housing market resident bull. Well in Australia, notibly the Bayside area. I would like to see your response, not a copy and paste, but something hand made by you, outlining why house prices are not falling and why they will not fall in Australia. Its just you seem to argue with all intense and purposes using public data?

Again a great reponse, i do feel you have gotten a point there folic. The higher they go, the more they will drop, and the lower they will go.


Get ready folks, it will be a long way down.

Originally Posted by folic

.....

Interestingly, those who warned of up to a 40% price-drop were experienced old-timers who'd seen it all happen before --- even as real-estate agents and the media continued to talk-up prices

and those who insisted it could 'never happen' were migrants and/or under-30s (in other words, those who had not experienced loss of 30 and 40 percent off their property's supposed 'value')

For those interested, here's a link to current reports re: Vancouver property's day of reckoning:

http://www.businessinsider.com/vanco...ollapse-2010-7