Australia Next ? - Vancouver Property Drops 30%
#31
slanderer of the innocent
Joined: Dec 2008
Location: Vancouver, BC
Posts: 6,695
Re: Australia Next ? - Vancouver Property Drops 30%
Whether it leads to significant price drops remains to be seen. If listings keep rising and sales drop, then sure. But the summer is traditionally a slow time anyway.
#32
BE Enthusiast
Joined: Feb 2005
Location: The Gold Coast, QLD
Posts: 443
Re: Australia Next ? - Vancouver Property Drops 30%
Location, Location, Location. It is still a fact that many people from all over the world actually want to live in Australia unlike maybe somewhere like Detroit where I think you can buy an entire deserted neighbourhood for around $10(slight exaggeration)
If prices just about hold then inflation alone will do the job of reducing real term value anyway.
We bought our place for $556k in 2007 and according to the RBA inflation calculator that $556k is now around $590k. The house is probably worth roughly what we paid for it if we were lucky. I could kid myself it has not dropped in value but in real terms it has of course.
Thats at an inflation rate of 3.1% and a few more years of that given that most people do have jobs and need some where to live the $556k will eventually look quite attractive.
Another thought is that a reasonable 4 bed house on a serviced block of land must be costing around $340k to produce and that will be in legoland not the more desirable areas so how low can prices actually go in places that people want to live.
Another thought again is that if prices crash as much as some people on this forum appear to want there maybe other wider social problems in place that
make the price of houses the least of your concerns.
If prices just about hold then inflation alone will do the job of reducing real term value anyway.
We bought our place for $556k in 2007 and according to the RBA inflation calculator that $556k is now around $590k. The house is probably worth roughly what we paid for it if we were lucky. I could kid myself it has not dropped in value but in real terms it has of course.
Thats at an inflation rate of 3.1% and a few more years of that given that most people do have jobs and need some where to live the $556k will eventually look quite attractive.
Another thought is that a reasonable 4 bed house on a serviced block of land must be costing around $340k to produce and that will be in legoland not the more desirable areas so how low can prices actually go in places that people want to live.
Another thought again is that if prices crash as much as some people on this forum appear to want there maybe other wider social problems in place that
make the price of houses the least of your concerns.
Last edited by neil248; Jul 9th 2010 at 10:35 pm.
#33
Guest
Posts: n/a
Re: Australia Next ? - Vancouver Property Drops 30%
In the quarter ended september 2009, 53,173 properties were sold in the capital cities at an average price of $449,649.
Assume those prices went up by 20% to $539,000, but they built 54,000 terraced houses at $250,000 each.
The median price would immediately drop to $250,000
Assume those prices went up by 20% to $539,000, but they built 54,000 terraced houses at $250,000 each.
The median price would immediately drop to $250,000
#34
_
Joined: Aug 2005
Location: Perth (ex Oxford)
Posts: 411
Re: Australia Next ? - Vancouver Property Drops 30%
...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.
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.
There's the usual small band of doom and gloomers on this forum who want nothing less than a total loss of confidence in any sector that can influence the value of houses. This is their ticket to their dream home of course.
I know of a particular individual who admitted a grand plan of spreading as much negativity on forums to hopefully have some influence in the general markets desire to buy a home.
What they fail to understand is that should there be dramatic falls in prices then a lot of other factors will come into play and they may find themselves in a worse situation.
The other factor of course is that should the housing market start having some dramatic falls in value you'll have a load of Brits, South Africans, Chinese et al falling over themselves to take advantage ... cushioning the fall almost before it happens.
#35
Banned
Joined: Feb 2009
Posts: 1,855
Re: Australia Next ? - Vancouver Property Drops 30%
Australia and Canada are totally two seperate countries on the other side of the world from another, house prices falling 30% in vancouver is meaningless regarding OZ house prices.
#36
BE Forum Addict
Joined: Mar 2004
Location: Sydney
Posts: 1,628
Re: Australia Next ? - Vancouver Property Drops 30%
Remember though that median prices mean nothing....
My personal opinion on Median prices: The Truth about Median Property Prices
http://www.abcdiamond.com/wp-content.../07/median.png
My personal opinion on Median prices: The Truth about Median Property Prices
http://www.abcdiamond.com/wp-content.../07/median.png
Year Median House Price House Price % Change (YoY)
2001 $1,009,500 28.6%
2002 $1,236,250 22.5%
2003 $1,205,500 -2.5%
2004 $1,265,000 4.9%
2005 $1,575,000 24.5%
2006 $1,807,500 14.8%
2007 $1,625,000 -10.1%
2008 $1,700,000 4.6%
2009 $1,290,000 -24.1%
This "crash" is however totally due to last year being year of the first home buyer so more 2 beds and less 5 bed/waterfronts being sold, the same as the rise of 24.5% in 2005 is likely to be because less 2 beds were sold.
#37
BE Enthusiast
Joined: Oct 2008
Location: Sydney
Posts: 992
Re: Australia Next ? - Vancouver Property Drops 30%
Even if there is a drop in house prices it certainly wont be uniform across the country.. some areas will be hit harder than others and some will only feel a slight ripple.
#38
Re: Australia Next ? - Vancouver Property Drops 30%
Totally agree, every country has its little gems, which are havens from disaster.
#39
BE Enthusiast
Joined: Apr 2007
Posts: 691
Re: Australia Next ? - Vancouver Property Drops 30%
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
Where and when did Australian house prices drop by 40%????
It has never happened!!! Maybe a couple of per cent here or there, but that statement is just plain mistruth.
Where and when did Australian house prices drop by 40%????
It has never happened!!! Maybe a couple of per cent here or there, but that statement is just plain mistruth.
#40
BE Enthusiast
Joined: Apr 2007
Posts: 691
Re: Australia Next ? - Vancouver Property Drops 30%
My sentiments exactly.
There's the usual small band of doom and gloomers on this forum who want nothing less than a total loss of confidence in any sector that can influence the value of houses. This is their ticket to their dream home of course.
I know of a particular individual who admitted a grand plan of spreading as much negativity on forums to hopefully have some influence in the general markets desire to buy a home.
What they fail to understand is that should there be dramatic falls in prices then a lot of other factors will come into play and they may find themselves in a worse situation.
The other factor of course is that should the housing market start having some dramatic falls in value you'll have a load of Brits, South Africans, Chinese et al falling over themselves to take advantage ... cushioning the fall almost before it happens.
There's the usual small band of doom and gloomers on this forum who want nothing less than a total loss of confidence in any sector that can influence the value of houses. This is their ticket to their dream home of course.
I know of a particular individual who admitted a grand plan of spreading as much negativity on forums to hopefully have some influence in the general markets desire to buy a home.
What they fail to understand is that should there be dramatic falls in prices then a lot of other factors will come into play and they may find themselves in a worse situation.
The other factor of course is that should the housing market start having some dramatic falls in value you'll have a load of Brits, South Africans, Chinese et al falling over themselves to take advantage ... cushioning the fall almost before it happens.
Mind you, I do feel really sorry for new home buyers in Australia. The reality is your first home is unlikely to be your dream home, especially if you earn an average income. Start small and work up. Our first house was tiny and leaked when it rained... not at 55 & 57 we have a nice home after many years scrimping to pay our first mortgage.
#41
Guest
Posts: n/a
Re: Australia Next ? - Vancouver Property Drops 30%
I am pretty sure the median price for that area has dropped by at least 40%
#42
*
Joined: Dec 2005
Posts: 1,073
Re: Australia Next ? - Vancouver Property Drops 30%
There are also suburbs near you which have had land valuations go up by around 70%...so as much as I cant see house prices dropping by 30% I cant see them rising by 70% either
#43
Re: Australia Next ? - Vancouver Property Drops 30%
Absolutely NO SIGN of a drop in S/E Melbourne. We sold in Nov 2008 for $402. Yesterday the house opposite, wayyy smaller, no pool, smaller block sold for $485....
Likewise the house across the rd from us where we live now, 3 bed, one living area...teeny block ..no study (but very nice inside) just sold for 45K more than we bought this for (4 bed/ study/home office/3 living areas) Nov 2008.
Houses here are never on the market for more than a couple of weeks before they sell and the open for inspections block the streets with cars.....
I'm not saying that there won't be a slow down in some areas, but I think holding off waiting for it to happen is a risky gamble. I'd be more inclined to buy a renovators delight...at least that way if there is a slow down you get to add to the value of your home rather that being in neg eq immediately and no way of getting back the deficit until the market rises again....
Likewise the house across the rd from us where we live now, 3 bed, one living area...teeny block ..no study (but very nice inside) just sold for 45K more than we bought this for (4 bed/ study/home office/3 living areas) Nov 2008.
Houses here are never on the market for more than a couple of weeks before they sell and the open for inspections block the streets with cars.....
I'm not saying that there won't be a slow down in some areas, but I think holding off waiting for it to happen is a risky gamble. I'd be more inclined to buy a renovators delight...at least that way if there is a slow down you get to add to the value of your home rather that being in neg eq immediately and no way of getting back the deficit until the market rises again....
#44
Guest
Posts: n/a
Re: Australia Next ? - Vancouver Property Drops 30%
The actual property value in that year didn't really move though
An interesting thing about Land Valuations...
2005 Council Land Valuation $90,000 General Rates $184.49 per qtr
2006 Council Land Valuation $180,000 General Rates $182.29 per qtr
2010 Council Land Valuation $180,000 General Rates $229.59 per qtr
Land valuations don't scare me at all
#45
BE Enthusiast
Joined: Oct 2008
Location: Sydney
Posts: 992
Re: Australia Next ? - Vancouver Property Drops 30%
The place where you are going to get stung are those sleepy little coastal towns 3 or 4 hrs drive out of the metro areas, the typical Brit's dream of beach-side house with a pool in a rural picture post card setting could turn into a nightmare if all the city slickers decide to sell off their holiday home & local business is affected and the small town un-employment goes up.