Confusion over what's actually happening in housing market!!
May 31st 2004, 1:33 pm
#16
Forum Regular
Joined: May 2004
Posts: 55
Originally posted by RichS
I'll potentially have between 550 and 650 to buy a house with (all depends on where we buy).
I can't do anything for another year, but I have started monitoring certain areas we are interested in.
I can tell you that prices in all those areas (by that I mean asking prices and posted sales results) are moving in the right direction for me - downwards. This is all Sydney regionals.
Brisbane seems to me to be rising a little.
I'll potentially have between 550 and 650 to buy a house with (all depends on where we buy).
I can't do anything for another year, but I have started monitoring certain areas we are interested in.
I can tell you that prices in all those areas (by that I mean asking prices and posted sales results) are moving in the right direction for me - downwards. This is all Sydney regionals.
Brisbane seems to me to be rising a little.
Don't worry too much, you have plenty of time to make the move, the price will go southward for quite sometime. DOWN, DOWN, DOWN, and DOWN. We just have to avoid foolish mistake to buy at the peak and to sell (for whatever reason that cannot be avoided) at the bottom.
Jun 1st 2004, 12:25 am
#17
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Joined: Sep 2002
Location: Mornington, Melbourne
Posts: 419
I think details in the report such as the fact that auctions are down by 50% and even less are being sold is a clear indication that people are very nevous in melbourne and Sydney.
It really could go eitherway, the press could pre-empt the fall, if they talk about a "crash" enough times it will surely happen.
Houses are no different to shares, people suffer from greed and people also get jittery.
Mark my words "the worm has turned!" (IMHO):scared: :scared: :scared:
It really could go eitherway, the press could pre-empt the fall, if they talk about a "crash" enough times it will surely happen.
Houses are no different to shares, people suffer from greed and people also get jittery.
Mark my words "the worm has turned!" (IMHO):scared: :scared: :scared:
Jun 1st 2004, 12:41 am
#18
Forum Regular
Joined: Jan 2002
Posts: 164
I have been watching house prices in one area in Perth during the last three months and even though some people are saying that Perth house prices are still rising I have seen 5 of the 30 properties I've been watching drop their price.
This obviously contradicts what some people are saying, but I'm only interested in the one area not the general view. As far as I can see prices are going down, and more importantly if people 'preceive' that prices are going down then they will push for a lower price when putting an offer in and if investors think that house prices are going down then they will start to put their houses on the market which could cause a glut which in turn will drive house prices down because too many sellers are chasing too few buyers.
If the house prices in Oz are dropping like most reports suggest then there is a likely chance that interest rates will remain the same or even go lower. This is one of the reasons that the $ have dropped against sterling because markets think Oz rates will remain constant or go lower whereas UK rates are definitely on the up which means more investment in the UK.
Just my opinion
Adrian
This obviously contradicts what some people are saying, but I'm only interested in the one area not the general view. As far as I can see prices are going down, and more importantly if people 'preceive' that prices are going down then they will push for a lower price when putting an offer in and if investors think that house prices are going down then they will start to put their houses on the market which could cause a glut which in turn will drive house prices down because too many sellers are chasing too few buyers.
If the house prices in Oz are dropping like most reports suggest then there is a likely chance that interest rates will remain the same or even go lower. This is one of the reasons that the $ have dropped against sterling because markets think Oz rates will remain constant or go lower whereas UK rates are definitely on the up which means more investment in the UK.
Just my opinion
Adrian
Jun 1st 2004, 12:45 am
#19
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Joined: Sep 2002
Location: Mornington, Melbourne
Posts: 419
well said!, totally agree.
Jun 1st 2004, 1:00 am
#20
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Joined: Jan 2004
Location: Far away from canned Oz
Posts: 1,833
Originally posted by alrobson
If the house prices in Oz are dropping like most reports suggest then there is a likely chance that interest rates will remain the same or even go lower. This is one of the reasons that the $ have dropped against sterling because markets think Oz rates will remain constant or go lower whereas UK rates are definitely on the up which means more investment in the UK.
Just my opinion
Adrian
If the house prices in Oz are dropping like most reports suggest then there is a likely chance that interest rates will remain the same or even go lower. This is one of the reasons that the $ have dropped against sterling because markets think Oz rates will remain constant or go lower whereas UK rates are definitely on the up which means more investment in the UK.
Just my opinion
Adrian
Real Estate agents talk the market up, because it is in their commission-based interest to do so. If property isn't bought/sold they don't make money.
But the Oz Reserve bank will have some very difficult decisions to make in the next few months. If it leaves interest rates unchanged, the housing market will probably continue its decline (albeit not too severely if the media lay-off the scaremongering) and the Oz $ exchange rate (eg with £) will continue to deteriorate.
The latter is good for Oz exports - but a lot of (part-)finished goods are imported into Oz . Which means prices - and hence inflation are likely to rise. (Even the purchase of a Jumbo Jet by QANTAS can perceptibly move the exchange rate!)
This will be made worse by the current historically high levels of employment in Oz. So, there will be pressure on interest rates to rise. This could significantly increase the number of property sales and/or mortgage defaults - much of the investment property purchased over the past 2-3 years has been by people with only a medium-level income. So, they don't have a lot of spare cash to pay for higher interest payments. This, in turn, could depress general spending and hence the economy.
My guess is that the Reserve Bank is waiting for some more steam to come out of the housing market, before moving the rates up gradually. If the economy starts to buckle, they may even cut rates.
Last edited by MikeStanton; Jun 1st 2004 at 1:03 am.
Jun 1st 2004, 1:52 am
#21
Lost in BE Cyberspace
Thread Starter
Joined: Nov 2003
Location: Scotland
Posts: 7,949
Originally posted by MikeStanton
I agree. Always go with commonsense and gut-feel!
Real Estate agents talk the market up, because it is in their commission-based interest to do so. If property isn't bought/sold they don't make money.
But the Oz Reserve bank will have some very difficult decisions to make in the next few months. If it leaves interest rates unchanged, the housing market will probably continue its decline (albeit not too severely if the media lay-off the scaremongering) and the Oz $ exchange rate (eg with £) will continue to deteriorate.
The latter is good for Oz exports - but a lot of (part-)finished goods are imported into Oz . Which means prices - and hence inflation are likely to rise. (Even the purchase of a Jumbo Jet by QANTAS can perceptibly move the exchange rate!)
This will be made worse by the current historically high levels of employment in Oz. So, there will be pressure on interest rates to rise. This could significantly increase the number of property sales and/or mortgage defaults - much of the investment property purchased over the past 2-3 years has been by people with only a medium-level income. So, they don't have a lot of spare cash to pay for higher interest payments. This, in turn, could depress general spending and hence the economy.
My guess is that the Reserve Bank is waiting for some more steam to come out of the housing market, before moving the rates up gradually. If the economy starts to buckle, they may even cut rates.
I agree. Always go with commonsense and gut-feel!
Real Estate agents talk the market up, because it is in their commission-based interest to do so. If property isn't bought/sold they don't make money.
But the Oz Reserve bank will have some very difficult decisions to make in the next few months. If it leaves interest rates unchanged, the housing market will probably continue its decline (albeit not too severely if the media lay-off the scaremongering) and the Oz $ exchange rate (eg with £) will continue to deteriorate.
The latter is good for Oz exports - but a lot of (part-)finished goods are imported into Oz . Which means prices - and hence inflation are likely to rise. (Even the purchase of a Jumbo Jet by QANTAS can perceptibly move the exchange rate!)
This will be made worse by the current historically high levels of employment in Oz. So, there will be pressure on interest rates to rise. This could significantly increase the number of property sales and/or mortgage defaults - much of the investment property purchased over the past 2-3 years has been by people with only a medium-level income. So, they don't have a lot of spare cash to pay for higher interest payments. This, in turn, could depress general spending and hence the economy.
My guess is that the Reserve Bank is waiting for some more steam to come out of the housing market, before moving the rates up gradually. If the economy starts to buckle, they may even cut rates.
No, seriously Mike, good analysis of the current situation. The articles I posted in another thread also predict a lot of what you suggest could happen.
OzTennis
