Get into safety (35)
robplum: In NZ long time ago, people held views like that and the government of the day froze rents and tenants families right to live in the property forever.
Because of legislation Government enacted I know of at least one instance where the landlord, couldn't increase the rent from what it had been in the 1940's and couldn't kick the tenants out for as long as any family member desired to stay there, so the landlord was faced with low rent the properties upkeep as well as the rates etc.
It beggers disbelief property prices will always go up, I think most urban properties are grossly over valued. Though as long as government continues a emigration program probably then demand will keep prices up. But when reality returns, (no jobs in the cities, no food in the supper markets) most will become worthless liabilities
Because of legislation Government enacted I know of at least one instance where the landlord, couldn't increase the rent from what it had been in the 1940's and couldn't kick the tenants out for as long as any family member desired to stay there, so the landlord was faced with low rent the properties upkeep as well as the rates etc.
It beggers disbelief property prices will always go up, I think most urban properties are grossly over valued. Though as long as government continues a emigration program probably then demand will keep prices up. But when reality returns, (no jobs in the cities, no food in the supper markets) most will become worthless liabilities
The immigration program will lead to a lot of social tension that can erupt in violence towards them. When Australians cannot get jobs and immigrants are still allowed in in large numbers people may end up rioting. This immigration policy is unfair for both the Australians and the migrants. When I came the numbers were cut back because the country was in a recession and jobs for Australians were more important.
revealer24: According to EWI the present crisis is comparable to the East India Company crisis. Even in the 30's real estate prices fell along with income by 40%!!! At that time real estate was not speculated. But now we have the biggest real estate bubble in the world history. Have a look at this:
In a healthy unspeculated economy median house prices are 3x the median income. Today this ratio is 7-9x in cities!!! There is a long way down, and if you want to wait for the next cycle to reach this level you may need to hand around for another 70 so years and perhaps survive another world war that is in the making...
In a healthy unspeculated economy median house prices are 3x the median income. Today this ratio is 7-9x in cities!!! There is a long way down, and if you want to wait for the next cycle to reach this level you may need to hand around for another 70 so years and perhaps survive another world war that is in the making...
Oh, I do agree with you. I have a small commercial property I am trying to sell in preference to re-leasing it. No firm offer yet since May this year, but at least it's in a 'blue chip' location which is a saving grace. Which reminds me to go and update some details on the net.
Another 70yrs? Could be,lol...but I want to be footlosse and fancy free at the time, not bothering about property!!...;)
revealer24: According to EWI the present crisis is comparable to the East India Company crisis. Even in the 30's real estate prices fell along with income by 40%!!! At that time real estate was not speculated. But now we have the biggest real estate bubble in the world history. Have a look at this:
In a healthy unspeculated economy median house prices are 3x the median income. Today this ratio is 7-9x in cities!!! There is a long way down, and if you want to wait for the next cycle to reach this level you may need to hand around for another 70 so years and perhaps survive another world war that is in the making...
In a healthy unspeculated economy median house prices are 3x the median income. Today this ratio is 7-9x in cities!!! There is a long way down, and if you want to wait for the next cycle to reach this level you may need to hand around for another 70 so years and perhaps survive another world war that is in the making...
Oh, my memory... It is not the East India Company, but the "South Sea Bubble in 1720, a crash that deterred people “from buying stocks for 100 years"
revealer24: As the government will face the reality of dramatically shrinking tax income they will abolish negative gearing and will seek to tax whatever they can. At the same time as real unemployment skyrockets (not the massaged figures as if you work for a couple of hours a week you are not included in the figures) rent will also fall as people will move into share accommodation or back with their parents. The rental market is already getting depressed on the Gold Coast as many properties are on the market for a number of months before being rented out, and this is just the beginning of what is coming.
Your ideas work in a booming economy when things don't change much - you can let out your property, collect rents regularly, you have your tax break, etc. However, we are about to enter an very gloomy, unpredictable time period and none of our politicians have a clue about what is ahead.
Your ideas work in a booming economy when things don't change much - you can let out your property, collect rents regularly, you have your tax break, etc. However, we are about to enter an very gloomy, unpredictable time period and none of our politicians have a clue about what is ahead.
Im a Glass half full typa a girl
AgentAjax: I can only see one market that is a sure winner, and that is manufactories of coffins.
Not as funny as you think. As you know Im new to this whole flower industry. So Im finding that winter is certainly a tight time for flower sales.....
BUT... and its a big but, every time we have a cold snap, Im getting orders for sympathy and funeral flowers. Last week I did 2 funerals!! and Im just one tiny little business.
Maybe funeral homes will be the next 'blue chip' investment.
revealer24: ...but if you buy a property for $500k and by the time you pay off it is only worth $150k it is not much fun. It is not good to buy on the top of the bubble, else you end up with negative equity and cannot even sell until it is paid off.
Rev thats what happened in America isnt it. I remember my brother in law contemplating going on one of those buy up property trips to the USA. The banks there were lending the $$ for the home, and then some extra for improvements etc. So the purchaser had actually borrowed more than the house was worth. The idea being the property market would continue to increase and it would all balance out.
It didnt, the market started to fail, money that had been borrowed by the banks (from OS) to fund the lending got called in, the banks called in loans... and that was the end of that....
Certainly a similar thing can happen here, if people have borrowed without much equity, and interest rates rise, payments skyrocket.. blah blah = cheap house for sale.
Thats where you jump in Kizzy buy up all the cheapie houses, and become the next Real Estate magnate
Shell225: Rev thats what happened in America isnt it. I remember my brother in law contemplating going on one of those buy up property trips to the USA.
The banks there were lending the $$ for the home, and then some extra for improvements etc. So the purchaser had actually borrowed more than the house was worth. The idea being the property market would continue to increase and it would all balance out.
It didnt, the market started to fail, money that had been borrowed by the banks (from OS) to fund the lending got called in, the banks called in loans... and that was the end of that....
Certainly a similar thing can happen here, if people have borrowed without much equity, and interest rates rise, payments skyrocket.. blah blah = cheap house for sale.
Thats where you jump in Kizzy buy up all the cheapie houses, and become the next Real Estate magnate
The banks there were lending the $$ for the home, and then some extra for improvements etc. So the purchaser had actually borrowed more than the house was worth. The idea being the property market would continue to increase and it would all balance out.
It didnt, the market started to fail, money that had been borrowed by the banks (from OS) to fund the lending got called in, the banks called in loans... and that was the end of that....
Certainly a similar thing can happen here, if people have borrowed without much equity, and interest rates rise, payments skyrocket.. blah blah = cheap house for sale.
Thats where you jump in Kizzy buy up all the cheapie houses, and become the next Real Estate magnate
I have noticed the real estate here in W.A. is coming to a halt. Homes are getting harder to sell all the ones under $500 thousand have slowed down, a few months ago they were selling fast not now seems like not so good times ahead of us maybe. Also the banks are tightening up on loans to the first home buyers.
Shell225: Rev thats what happened in America isnt it. I remember my brother in law contemplating going on one of those buy up property trips to the USA.
The banks there were lending the $$ for the home, and then some extra for improvements etc. So the purchaser had actually borrowed more than the house was worth. The idea being the property market would continue to increase and it would all balance out.
It didnt, the market started to fail, money that had been borrowed by the banks (from OS) to fund the lending got called in, the banks called in loans... and that was the end of that....
Certainly a similar thing can happen here, if people have borrowed without much equity, and interest rates rise, payments skyrocket.. blah blah = cheap house for sale.
Thats where you jump in Kizzy buy up all the cheapie houses, and become the next Real Estate magnate
The banks there were lending the $$ for the home, and then some extra for improvements etc. So the purchaser had actually borrowed more than the house was worth. The idea being the property market would continue to increase and it would all balance out.
It didnt, the market started to fail, money that had been borrowed by the banks (from OS) to fund the lending got called in, the banks called in loans... and that was the end of that....
Certainly a similar thing can happen here, if people have borrowed without much equity, and interest rates rise, payments skyrocket.. blah blah = cheap house for sale.
Thats where you jump in Kizzy buy up all the cheapie houses, and become the next Real Estate magnate
Keep in mind that once this bubble bursts and completely deflates market conditions will change. It will be much harder to borrow for real estate investment as banks will consider it extremely risky. People will also hate debt as they did after the Great Depression, for they will realise how hard it is to get out of it. So no, I don't think anyone will think about investing in real estate again for a very long time once we hit the bottom in about 2017-2018. EWI originally expected the bottom to be around the end of 2016, but they also expected the second leg of the downturn to start a year ago, which didn't happen. We are yet to see if this current downturn will be the second leg down or just another hickup, which would push the times out again. The problem is huge (one quadrillion dollars debt needs to deflate in the world to manageable levels), and what is called the great super-cycle will come to an end.
revealer24: I don't think anyone will think about investing in real estate again for a very long time once we hit the bottom in about 2017-2018. EWI originally expected the bottom to be around the end of 2016
Will 2012 be a good year to sell?Shell225: As you all know I work for a number of small business that cover a broad spectrum of industry and trades.
One particular business up until a week or two ago, was taking bookings 2 - 3 weeks ahead now they've caught up and are flat out booking out the current week. Not a good sign.
Another business has NO pending jobs.
Generally the belief in business is that when these Market falls hit, 50% of people will stop spending, 50% continue on spending as normal. I dont think thats whats happening at the moment, seems that spending has reduced tremendously.
One particular business up until a week or two ago, was taking bookings 2 - 3 weeks ahead now they've caught up and are flat out booking out the current week. Not a good sign.
Another business has NO pending jobs.
Generally the belief in business is that when these Market falls hit, 50% of people will stop spending, 50% continue on spending as normal. I dont think thats whats happening at the moment, seems that spending has reduced tremendously.
real estate business and the funeral business go very well together sometimes. Maybe you could diversify. There will always be final estate sales.
revealer24: As the government will face the reality of dramatically shrinking tax income they will abolish negative gearing and will seek to tax whatever they can. At the same time as real unemployment skyrockets (not the massaged figures as if you work for a couple of hours a week you are not included in the figures) rent will also fall as people will move into share accommodation or back with their parents. The rental market is already getting depressed on the Gold Coast as many properties are on the market for a number of months before being rented out, and this is just the beginning of what is coming.
Your ideas work in a booming economy when things don't change much - you can let out your property, collect rents regularly, you have your tax break, etc. However, we are about to enter an very gloomy, unpredictable time period and none of our politicians have a clue about what is ahead.
Your ideas work in a booming economy when things don't change much - you can let out your property, collect rents regularly, you have your tax break, etc. However, we are about to enter an very gloomy, unpredictable time period and none of our politicians have a clue about what is ahead.
Stop it, you're scaring the crap out of me!!
Maybe I could move to Italy where the euro has already sunk!:((
venere08: Stop it, you're scaring the crap out of me!!
Maybe I could move to Italy where the euro has already sunk!:((
Maybe I could move to Italy where the euro has already sunk!:((
Italy has a huge problem itself. The third largest debt market in the world, nobody has enough money to bail them out. The safest place from economic storms is here in Australia. But it is an illusion to think that our banks are safe. They would have gone belly up if the US didn't print 14 billion dollars and quietly bought up all toxic assets around the world to unplug the financial system in the previous downturn. This time a bigger crisis is on the way, the EU may even break up and the Euro cease to exist as Germany is already fed up with bailing out irresponsible EU members.
But anyone here staying in real estate or stocks will bleed as a lot of red ink will flow. Banks will panic and pull the rug under even sound businesses as they will try to survive and will bankrupt many investors. It is better to get out of these investments and sit on the sidelines until the storm goes away.
revealer24: Italy has a huge problem itself. The third largest debt market in the world, nobody has enough money to bail them out. The safest place from economic storms is here in Australia. But it is an illusion to think that our banks are safe. They would have gone belly up if the US didn't print 14 billion dollars and quietly bought up all toxic assets around the world to unplug the financial system in the previous downturn. This time a bigger crisis is on the way, the EU may even break up and the Euro cease to exist as Germany is already fed up with bailing out irresponsible EU members.
But anyone here staying in real estate or stocks will bleed as a lot of red ink will flow. Banks will panic and pull the rug under even sound businesses as they will try to survive and will bankrupt many investors. It is better to get out of these investments and sit on the sidelines until the storm goes away.
But anyone here staying in real estate or stocks will bleed as a lot of red ink will flow. Banks will panic and pull the rug under even sound businesses as they will try to survive and will bankrupt many investors. It is better to get out of these investments and sit on the sidelines until the storm goes away.
Well, the U.S, can't keep printing money like that in this climate unless they make some major changes, but I have no skill base to make any further comment.
As they say, behind every cloud there is a silver linig...let the Aussie dollar remain strong, then I can live on pittance in Italy.
p.s. Berlusconi has already stated that he won't run for office at the next elections, which will please a certain section of the community. Generally that section, however, has no clue as to any constructive alternative. I ahve to say, though, that at least Italy has had the longest running government it's ever known while b. has been on office!...soon it might be back to the 30day musical chairs..
I know the Italians hate the euro and want their lire back as they believe they ahve been short changed since its abolition. I saw some of that for myself when going supermarket shopping, but nowhere near what they claim....No idea what Greece is going to do, as they produce precious little in the scheme of things.
I know the Italians hate the euro and want their lire back as they believe they ahve been short changed since its abolition. I saw some of that for myself when going supermarket shopping, but nowhere near what they claim....No idea what Greece is going to do, as they produce precious little in the scheme of things.
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As the government will face the reality of dramatically shrinking tax income they will abolish negative gearing and will seek to tax whatever they can. At the same time as real unemployment skyrockets (not the massaged figures as if you work for a couple of hours a week you are not included in the figures) rent will also fall as people will move into share accommodation or back with their parents. The rental market is already getting depressed on the Gold Coast as many properties are on the market for a number of months before being rented out, and this is just the beginning of what is coming.
Your ideas work in a booming economy when things don't change much - you can let out your property, collect rents regularly, you have your tax break, etc. However, we are about to enter an very gloomy, unpredictable time period and none of our politicians have a clue about what is ahead.