trismtr

There is a scary news in the www.theage.com.au

http://www.theage.com.au/articles/20...734371850.html

Is this true?

Anyone in Melbourne could confirm this? How about other cities, Sydney, Perth, Adelaide, Brisbane?

Rob

In trismtr wrote:
    > There is a scary news in the
    > www.theage.com.au
    > http://www.-
    > theage.com.au/articles/2002/09/28/1032734371850.html
    > Is this true?

dunno.

I read yesterday in a book that some economist once worked out that
the Oz housing market worked in a 7 year cycle of boom and bust.
When was the last property price crash ?

Robert Edwards

I am and have been involved (personally) in the property market and I cannot
recall a boom and bust cycle in recent times although there are periods of
"settling" down and we may be approaching one of those periods now as there
has been massive growth (in relative terms) in the building industry here
over the past 2 years so it is difficult to maintain this type of growth,
boom to bust though is a bit dramatic and I doubt that the middle market
will be effected to any great degree.

Rob Edwards

"rob" wrote in message
news:20020929183457974+0100@chad-
.hartill.net...
    > In trismtr wrote:
    > >
    > > There is a scary news in the
    > > www.theage.com.au
    > >
    > > http://ww-
    > > w.theage.com.au/articles/2002/09/28/1032734371850.html
    > >
    > > Is this true?
    > dunno.
    > I read yesterday in a book that some economist once worked out that
    > the Oz housing market worked in a 7 year cycle of boom and bust.
    > When was the last property price crash ?

dotty

Firstly, for the past three years I have read that the UK Property maket will burst. Sydneys market for the past two years, neither have bust have they? Papers do drone on this headline a lot.

Secondly, Australia is in massive drought, if Australia put the interest rates up, a big group to be affected would be farmers, so I think its a bit hard for Rates to go sky here at the moment. Therefor it has been said a bit of scarmongering is to try and scare Aus into spending less to control inflation. Obviously very little is known about drought in the UK, but is is a crisis here at the moment.

Thirdly, look at places like Brisbane, Prices have only been going up for a year or so. You could easily buy under $300, around $250 if not fussy. Hardly unaffordable similar prices in Perth I believe. I think housing debt in Brisbane is only 30% of income although much higher I read 59% in Sydney.

The rental market is overstocked in most cities. Why?, because when prices go up lots of people go into property hoping to cash in on profits. Plenty of empty rentals around at cheap prices which is good for newcomers.

Also where are the options, how many people are scared to put their money into the sharemarket. Probably silly as its so low, but Ausralians love the security of property.

I wouldn't be too surprised if prices in Syd or Melb even began to settle down but hardly likely to see Aussies stuffing money under their mattresses instead of buying houses.

Perhaps some of the uk punters could let us know if the UK housing market is really slowing yet?

petafray

Dotty

Thanks for your reply. Just to let you know that the UK bubble has yet to burst. My example is a house valued in Jan 2002 at £225000 went ont he market in July at £295,000 and sold in 2 weeks for £290,000. Stupid or what and this is in the Midlands, not the South East.

trismtr

1989 - 1990

Robert Edwards

I cannot recall a property crash in modern times, there was a tightening or
levelling of prices five years ago but crash to me indicates a negative rise
across the board and that I cannot recall happening. The problem with some
of the journos who write this emotive garbage are hell bent on writing their
own news whether it be shares or housing they are almost always wrong.


"trismtr" wrote in message
news:429089.1033350640@britishexpats-
.com...
    > Originally posted by Rob:
    > > In trismtr wrote:
    > > > There is a scary news in the
    > > > http://www.theage.com.au/www-
    > > > .theage.com.au
    > > > http://-
    > > > www.theage.com.au/articles/2002/09/28/1032734371850.html    "]ht-
    > > > tp://www.-
    > > > theage.com.au/articles/2002/09/28/1032734371850.html[/url]
    > > > Is this true?
    > >
    > > dunno.
    > >
    > > I read yesterday in a book that some economist once worked out that
    > > the Oz housing market worked in a 7 year cycle of boom and bust.
    > > When was the last property price crash ?
    > >
    > 1989 - 1990
    > --
    > Posted via http://britishexpats.com

trismtr

I think what the previous poster (dotty) said might be true. It is meant to deter over investment and to make a soft landing.

I just did a search at (beta) Google News search:

http://news.google.com/news?q=proper...n&lr=&ie=UTF-8

It seems that there is a concerted effort to make 'a soft landing' (with abundant negative news) rather than 'a crash landing' for property market.

Strange thing is, the buyers are still strong and going.

Do you have any opinion on this?

Ceri

My opinion is:

Just over a year ago I started looking at property in the Redcliffe area - Woody point to be exact. At that time, I could buy a house within walking distance to the water (a couple streets away) for 150 thou (AU) - three bedroom, nothing special. Now those same houses a year later are selling for over 240 thou... it's gone a bit mad.

Anyway, I've seen house prices rocket up within the last year, the reason I think this happened - is no 1 the first home buyers grant, low interest rates (6% average), lowest it has been for 15 years, plus I think "people" were scared if they don't buy now there's no way that they would be able to afford a house in a couple of years time.. with the house prices shooting up.

Although I don't think the house market will bust, I do think it will not carry on rising at the same rate. I personally think If the interest rates go up there will be a few people losing their homes. A lot of people have been borrowing "big time" to their max. The banks have been lending some people more than they can really afford.

I don't think the market will bust, as there are more and more immigrants flocking into Australia, there will always be a need for housing... and everyone wants to live by the sea... so those houses will not bust. Where I am living now, there is no more land, "they" are knocking old houses down to replace them with new. But, I think the market will slow up, and house prices will not carry on rising at the rate it has been doing for the past year.

I also heard that now there are more rental properties than renters... A lot of people bought houses for investment during the past year (to rent out), and now there seems that there are more rental houses than needed.

who knows? But being a new "buyer" myself... I hope it does not go bust


cheers

Rob

In dotty wrote:
    > Firstly, for the past three years I have read that the UK Property
    > maket will burst.

There were similar predictions of trouble ahead in the late
90s when the US stock markets climbed higher and higher. Weeks
before it happened, those making the predictions were a laughing
stock.

What I learned from that crash was that things should be
valued for what they are really worth. Shares should be
valued against company debts, turnover and profits, houses
should be valued against the cost of land and building costs.

If a house costs £60,000 to build, it should not be sold for
£200,000+, as is happening now in many parts of the UK.

Three houses in the street my sister lives on, built 2 years
ago and sold for £100k-130k are now selling for £220k+.
When I hear those prices I can't help laugh, because I know
the build-quality isn't the best and that the houses are
simply not worth it. The buyers must be stretching their
budgets to the limit for houses that are cheap to build.

If you pay over the odds for something, you run the risk of
losing money.

trismtr

Am I insane with my decision to go to Australia? !!

http://www.theage.com.au/articles/20...115956539.html

Dr Oliver said Australian house prices were among the most expensive in the world in terms of relative household income and wealth levels. A house in Australia costs more than twice as much in terms of average household income than a US house does, and 36 per cent more than a British house.

etlniwd

Very true. Tech stocks in particular were ridiculously overvalued. Easy to see the reasons for the crash when you look back. The property rental market is not dissimilar.
Not really true. Rebuilding costs will always be less than market value. Market value is based more on the fact that you have your own little space on this congested, fixed-sized planet.

I believe the UK housing market has peaked. I have first-hand experience of this because I am currently going through a sale. For the first time in years you will find 'Reduced' stickers in Estate Agents' ads in the local papers. This is always a sure sign that the market cannot sustain any more growth. It will take several months for the leveling off to turn to price drops though - at the moment sellers are reluctant to drop prices so they just hold on for longer instead.

Once we get the 'House Prices are Falling' headlines in the press all those rental property owners who were holding on for just one more rise will start to flood the market which will precipitate the falls even more. If that doesn't happen then we'll just have to have many years of flat prices.

Still a good long-term investment though. The world population is rising and the planet surface doesn't get any bigger.

mashiraz

Is this south east, or wider. I an not seeing property reduced in East Midlands, there is still a shortage and property is being snapped up very quickly.

mash...

etlniwd

This is in Sussex. It's the same in London. Took me two months to get an offer on a very nice property. In the end I had to shave 3.5% off the price. Others are having the same problem. One year ago I could have sold within a week.

Probably the usual thing. Property prices move (either way) first in London and then the Home Counties. After a year or so the effect propagates through to East Anglia and Northern Ireland.

mashiraz

We'll probably selling in the early spring, so fingers crossed it lasts as long as that. Value increased incredibly over the past 12 months.

Mash