House prices to fall between 15-20 per cent by 2008
 

Probably more unemployed too.

"HOME loan interest rates would rise to 9 per cent next year, causing house prices in Sydney and Melbourne to fall between 15-20 per cent by 2008 after inflation, according to a new housing report from BIS Shrapnel."

House prices dropping

Re: House prices to fall between 15-20 per cent by 2008
 

Perth, Darwin and Brisbane were still expected to show some growth in 2005-06.



argh. Of course there's no way to predict what they do after that :(
(Looking to buy in Perth mid 2006. For the long term though, not a shortterm investment....)

Re: House prices to fall between 15-20 per cent by 2008
 

In 2003, BIS quoted "The housing boom will experience a mild correction before a new lease of life lasting until 2006, a report has predicted.
"Both residential and non-residential building commencement will move into a fully-fledged boom over the two years to 2005-06, driven by rising underlying demand in both sectors, as well as strong economic growth," says Building in Australia, a national report by building analyst BIS Shrapnel.
But it says that after peaking in mid-2006, housing interest rates of 10 per cent will drive residential construction into a downturn lasting until the end of the decade" http://www.theage.com.au/articles/20...663741286.html

If only we knew which reports will be right :)

I have seen it quoted that BIS are correct 50% of the time. :D

Re: House prices to fall between 15-20 per cent by 2008
 

Think I'll wait a couple of years before spending money on the house. By then, the tradies bank accounts will be trimmed as will their rates.

Re: House prices to fall between 15-20 per cent by 2008
 

I don't think that the penny has yet dropped with many people here: I am still seeing many houses for sale at ridiculous prices. And they are the same ones as last November!

The housing market is still looked at as a way to getting rich, the fact that you want to live somewhere is only of passing interest.

Just look at the TV, papers, estate agents' windows: the buzzwords are still "investment", "negative gearing", "cashflow", "return on equity", "capital appreciation", "rental return", "investment opportunity" etc. The one word that is almost never seen is "HOME"!

A lot of people have made a lot of money over the last ten years, but I suspect that a lot of people are going to find it's not the same over the next five or ten. After all is said and done, in the end it is the guy who is prepared to put his money down for somewhere to live himself who drives the whole shebang, and if he is priced out of the market at some stage the market stays put or goes down.

Re: House prices to fall between 15-20 per cent by 2008
 

Lots of people have already decided to stay put, but still have the houses up for sale, "Just In case" They never know, someone may just come along and pay the high price !

Most "serious" investors locked in at low 5 year fixed interest rates a year or two ago, and are able to riide out any dips, so will not sell at reduced prices, unless better offers come along.

The people who will sell, are those "mums & dads" investors, who may get caught in a cash flow situation, if they aren't on fixed interest rates, or if they get cold feet and panic.

Re: House prices to fall between 15-20 per cent by 2008
 

Prices here in perth are still rapidly climbing!!!

Re: House prices to fall between 15-20 per cent by 2008
 

So has the price of iron ore and nickel. Good rains recently in the wheat belt.

Re: House prices to fall between 15-20 per cent by 2008
 

Re: House prices to fall between 15-20 per cent by 2008
 

So how is it looking for first time buyers in Oz?

As grim as the first time buyers in the UK?

M :(

Re: House prices to fall between 15-20 per cent by 2008
 

I suspect so. from what I read in the papers the US has the same problem. If the interest rates do get to 9% as BIS state, then there are going to be a lot of people who have major problems.

15 years ago people could handle 16% - 19% interest rates, again, from reading, there is no fat left within the system. Back then the average mortgage was around $80K and incomes could manage rises, with the average mortgages being around $200K (and that's only for Perth) any % increase means large repayment increases.

I think the banks and federal government are going to be in for a hell of a shock if the interest rates do rise by that amount. Not half as much as of a shock as them's who has to find the $$ to service their mortgages though.

Re: House prices to fall between 15-20 per cent by 2008
 

I seem to remember all the same stories floating about in England in 2001, we were buying a house at the time, and were a little unsure as to if we were doing the right thing, what with negative equity etc. When we sold it in 2004, it had gone up in value 235%. Moral of the story, dont believe everything you read.

Re: House prices to fall between 15-20 per cent by 2008
 

No comment. Immoral. :mad:

Re: House prices to fall between 15-20 per cent by 2008
 

http://www.theage.com.au/articles/20...html?from=top5

The pundits don't even seem to agree on what the report predicts - according to 'The Age' the BIS Shrapnel report predicts that in Melbourne:

"Prices are tipped to fall by 4.8 per cent over the next three years. BIS Shrapnel makes the claim in its Residential Property Prospects, Australian Capital Cities report, which predicts the market until 2008".

BUT - "Industry analyst John Edwards of Residex talked up the market, claiming Melbourne was coming out of its correction.

He predicted the market would be flat over the next 12 months, and then values would rise by 3 to 4 per cent over the next couple of years. Mr Edwards, whose company has sales data going back to the 1880s, said it was historically rare for residential values to fall for more than three or four quarters during a correction".

Put your bets on who is likely to be right! :D

Anyhow (have a Winfield), it looks like a good time to have no mortgage, savings (with higher interest rates earned) and no property to sell in the short term. (Mr and Mrs OzT)

OzTennis :)

Re: House prices to fall between 15-20 per cent by 2008
 

Something like life being a lottery! Good if you have one of the winning tickets, lousy if not!!!

I worry about the next generation, even many of the 30 pluses I know are still not on the housing ladder and the only way will be inherting Mum & Dad's place.

M :(