1985 vs 2016

Discussion in 'Property Market Economics' started by MJS1034, 4th May, 2016.

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  1. Hanison

    Hanison Well-Known Member

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    Because I'm greedy and I want to steal your next deal ......
     
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  2. Aaron Sice

    Aaron Sice Well-Known Member

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    Econ student. Has "seen the light" with Keynesian economics and has come to tell us all how Ponzi we all are.

    Seen it all before over on SS....
     
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  3. wylie

    wylie Moderator Staff Member

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    Glad I didn't disappoint you.
     
  4. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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    Couldn't be further from the truth, but still flattering. ;)
     
  5. joel

    joel Well-Known Member

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    5% deposit without LMI is 5%. For a 500k house thats 25k.

    5% deposit with 3% capitalised LMI means your debt is 95% or 475k, plus the 3% (15k) LMI.. total debt 490k on a 500k house. So you have 2% equity or 10k. Thats substantially less than 25k - you will have lost more than half of your deposit. Not a good start for someone on low income that spent years saving for that.
     
  6. Steven Ryan

    Steven Ryan Well-Known Member

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    Oh, I was mistakenly thinking when you said “substantial cost” you meant an monetary cost but I see you are referring to having less equity as a “substantial cost”.

    Since your parent's didn't go guarantor, what did you end up buying (price and LVR)? :)
     
  7. joel

    joel Well-Known Member

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    A cost is a cost. Just because its not upfront doesnt mean it doesnt matter.

    I bought at 150k at about 90%. 9k went to fees including LMI. During settlement I worked during the day and then drove about an hour to the property to renovate at night. LVR is probably closer to 80% now.
     
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  8. Plutus

    Plutus Well-Known Member

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    Agreed RE Greed and inability to have a balanced argument on this forum.. I mean its kinda obvious we're all going to have a bias, if we didn't think property was a good investment, we probably wouldn't be on here?

    Also who says greed is bad?

    Maybe they have embraced the "if you can't beat 'em, join 'em" idiom?
     
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  9. Angel

    Angel Well-Known Member

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    Yeah, I'm such a greedy Boomer. I go to work, obviously because I am lazy and only work long enough to earn $35K. I financially supported my kids when they were at uni, o shock gasp. I am so greedy because I think I can follow in the footsteps of such esteemed investors as Sea Change and Sash and Wylie and Player and somehow retire from work in the next few years and not go on a pension. O shivers I'm greedy because I don't particularly want to collect the pension. Greedy, greedy, greedy. Any more alcohol tonight and I might even start swearing.
     
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  10. Aaron Sice

    Aaron Sice Well-Known Member

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    Whatev's bra'...
     
  11. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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    Greed and Fear are the two underlying sentiments driving investments, various indexes (VIX) measure it and investors take investment decisions based on these indexes. Even on this forum there is a section dedicated to psychology of investment.

    Why the shock, horror and ridicule in taking cognizance of the underlying emotions effecting (ir)rationality of investments ?

    History is replete with examples of greed driven herd manias which have had disastrous consequences. Time will be the judge of contemporary love affair with property. At present it is adversely effecting the FHBs as many researchers, news outlets, social organizations and even financial institutions agree. Two major political parties (ALP and greens) have adjusted their policies in recognition of this anomaly and there will be an election fought on this issue, so it is at least important enough to be discussed rationally. Elections will decide if status quo will change or not and if the balance shifts to the FHBs.

    A lot of changes are happening currently and proposed in the near future:
    • Credit environment has changed drastically and is only expected to deteriorate further.
    • Superannuation is no longer as sacred as it was and has been pared back.
    • Foreign demand is receding.
    • Economy is contracting. Major driver of economy (mining) has been severely wound back.
    • The important foundations of property investing viz NG and CGT exemption are being challenged by growing sections of society.
    Maybe some of the personal responses can be explained by early stages (denial, anger, bargaining, aggression) of change as postulated by Kubler-Ross Kübler-Ross model - Wikipedia, the free encyclopedia.

    Finally
    upload_2016-5-6_20-47-10.png
     
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  12. hobo

    hobo Well-Known Member

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    Really - just greed, and fear?

    Not any aspect of, say..... Wanting To Be Self Sufficient... or Trying To Do One's Best.... or I've Seen The Results of NOT Investing And It's Got Rocks On It So I'm Going To Go Down Another Path..... nope... just Greed and Fear??

    Oooooooookay then. Carry on.
     
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  13. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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    In one word 'why' ? Why do you:
    • Want to be self sufficient
    • Want to try your best.
    • Want to go down another path
    Very seldom will the answer deviate from fear or greed. Give it a go.
     
  14. Hanison

    Hanison Well-Known Member

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    @Skilled_Migrant

    I guess the same could be asked of yourself.

    Which was it that brought you here to Aus then ?

    Fear or greed ?

    We love you either way.
     
  15. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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  16. Newyproperty

    Newyproperty Well-Known Member

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    upload_2016-5-7_9-22-31.png

    orange marks the year where is was cheaper than present day
     
  17. Newyproperty

    Newyproperty Well-Known Member

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  18. MTR

    MTR Well-Known Member

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    Wolf of Wall Street
    Belfort, I agree with his comments on this... Greed is a negative trait.

    Ambition is good
    While Belfort says greed is not good, he does say “ambition is good, passion is good. Passion prospers. My goal is to give more than I get, that’s a sustainable form of success.” Belfort says he “got greedy”
     
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  19. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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    Interesting articles on inter-generational housing affordability and wealth transfers:

    Could your parents afford to help you buy a house?

    Those who get a parental gift much more likely to own a home

    http://www.ahuri.edu.au/__data/asse...nal_transfers_affect_housing_and_wealth-1.pdf

    Th comments are hilarious and the following graph highlights why housing affordability is a political winner for Labor:

    upload_2016-5-7_18-17-52.png

    Edit: Detailed paper on (Inter-vivo and Bequests) wealth transfers:
    http://www.ahuri.edu.au/__data/asse...-transfers,-housing-and-economic-outcomes.pdf
     
    Last edited: 7th May, 2016
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  20. Hanison

    Hanison Well-Known Member

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