Australia six weeks from a housing collapse, US report warns

Discussion in 'Property Information Resources & Tools' started by Propertunity, 12th Sep, 2016.

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  1. Ed Barton

    Ed Barton Well-Known Member

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    Please advise the day and time. I don't want to be on a plane. The property crash is likely to cause the aeroplane to crash!
     
  2. MikeyBallarat

    MikeyBallarat Well-Known Member

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    And that is the fundamental flaw with the doom and gloomers' philosophy. It requires our population *en masse* to suddenly decide that they don't want to pay any money for housing any more. Outside of extreme government intervention (or a disaster which will make house prices seem unimportant), how could that happen? No government would ever want to be responsible for a decrease in house prices, it's political suicide.

    It's normally the types with an 'it's all too hard' attitude that lap up this kind of stuff, hoping to score a $300k home in Bulimba, completely ignoring the $300k home they could buy in Ipswich. Maybe in Sydney house prices are actually unaffordable (I don't know anything about Sydney), but who says you have to live there?
     
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  3. MikeyBallarat

    MikeyBallarat Well-Known Member

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    Steve Keen reminds me of Homer Simpson, when he tries to mathematically predict the rapture, and keeps on changing the date when it doesn't happen.
     
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  4. Scott No Mates

    Scott No Mates Well-Known Member

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    Are we there yet?
     
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  5. larrylarry

    larrylarry Well-Known Member

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    And if you know it before me, please PM me.
     
  6. Scott No Mates

    Scott No Mates Well-Known Member

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    If property goes down, won't that make landing more difficult esp for airports near the water?
     
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  7. Azazel

    Azazel Well-Known Member

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    Or just move to Queensland.
    Business as usual up here :)
     
  8. Big Will

    Big Will Well-Known Member

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    Damn doesn't look like the crash has happened, I guess I will keep waiting for it to happen?
     
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  9. larrylarry

    larrylarry Well-Known Member

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    It was posted on 13 September 2016. Just over a week after the "6 weeks" prediction. Maybe we should ask the writer Frank Chung to follow up with US Defence think tank.
     
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  10. kierank

    kierank Well-Known Member

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    Wouldn't waste your time. Put your time into selling down your portfolio.

    The crash is still coming !!!!
     
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  11. Azazel

    Azazel Well-Known Member

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    Maybe they didn't adjust for the Southern Hemisphere.
    They were expecting a gloomy Autumn, we have a bright Spring...
     
  12. Perthguy

    Perthguy Well-Known Member

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    are we there yet? ;)
     
  13. larrylarry

    larrylarry Well-Known Member

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    I'm a bit surprised that the think tanks haven't updated their analysis... maybe sacked by Trump.
     
  14. JacM

    JacM VIC Buyer's Agent - Melbourne, Geelong, Ballarat Business Member

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    Doesn't seem to have happened yet. False advertising! We were promised a smorgasboard of cheap houses !
     
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  15. highlighter

    highlighter Well-Known Member

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    People are being absolutely ridiculous about this. The thing is, the prediction was "six weeks to prevent a crash". Besides this, property markets don't just crash all of a sudden, they take years. I come from Ireland, and it literally took five years or more. Even the market peak took ages. I remember reading the market didn't so much pop as exhale, and it's true, it was two years until you could really even be sure it was falling.

    Dismissing this sort of prediction as nonsense isn't going to prevent reality asserting itself on an extremely indebted and oversupplied market. It's also ridiculous to say it won't happen because it hasn't happened yet. If you're 90 years old people will start predicting when you'll croak. The fact you haven't croaked by 100 doesn't mean you're not going to or that people were "wrong" to say you would. They were premature, not wrong. And it makes the forecast of your death more likely and imminent, not less.

    We've been "hearing about this crash for years" but in that time we've accumulated extreme levels of debt. We've built a huge over-supply that is just coming onto the market now. We've concentrated too much investment in property. One thing I remember living in Ireland was the hubris of bulls who totally dismissed any possibility of a collapse. They couldn't point to what, if anything, would support price growth. Their only evidence against a crash was that there hadn't been a crash. But of course it happened.

    Property investment had become too easy. The market was filled with greater fools. Every man and his dog was scrambling around buying anything assuming they'd be on the gravy train for life. This is a property investment forum filled with people who seem extremely skilled and savvy, but don't forget most investors are not like you. They haven't all made smart choices or even affordable choices, and they won't all weather a storm. And that is the problem.

    Joking about this sort of prediction dismisses a very real possibility out of hand simply because it hasn't happened to date. Ireland fell for the same "won't happen to us"/"hasn't happened yet" fallacy and we know how that ended. Just sayin'.
     
  16. Propertunity

    Propertunity Well-Known Member

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    The bottom line is that people (would-be investors) who have paid any attention to this mob, or Keen, or Harry Dent, or a long line of others predicting a crash or a bursting bubble since pre-GFC days would have done themselves a disservice big time. Those who ignored them and invested wisely, made money, period, full stop!
     
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  17. Sackie

    Sackie Well-Known Member

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    I believe the majority of people who have han opinion on real estate investment need to be ignored. Its only a small handful of successful, like minded people who are most valuable. Its a myth that successful investors are blinded and only focus on forever growing profits. The ones I know are mostly focused on risk mitigation, hence why they are quite successful. It's not by ignoring the risks, but knowing A) who to listen to and discuss issues with and B) how to mitigate risks. Generally most other people you see at workplaces, the beach, the café, person next to you on the plane, the professional pundits - all have zero to very limited insight that may be useful. Indeed many have what I call Negative Insight, an understanding/perspective etc that steers you away from otherwise what could be quite profitable deals.

    Just my opinion.
     
    Last edited: 16th Nov, 2016
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  18. Perthguy

    Perthguy Well-Known Member

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    Well, I have been mocking this prediction but I am fully aware that Sydney will soon enter a correction phase will Melbourne following some time after that. The reason I mock is because of predictions like this:-

    “It’s going to be a disaster. By the end of 2017 the housing market will crash, and at least one of the big four banks will either be bailed out, go bust or be nationalised,” he said. (1)

    and this:-

    “We estimate that Australia has about six weeks or so to turn this situation around, otherwise there would be a massive hit on property valuations and the building trades,” he said. (2)

    These catastrophic predictions are problematic on a number of levels.

    I agree the dismissing these sorts of predictions as nonsense won't stop the Sydney market and the Melbourne market from correcting. However, I don't agree that most people are saying it won't happen. I have participated in lots of discussions where people have been talking about the last Sydney correction/consolidation period that started in around 2003. We expecting the Sydney market to peak in 2015, then 2016 and now it looks like it might continue to remain strong in 2017. A peak is very hard to predict, which is why I mock people in 2013 predicting an 'imminent and catastrophic collapse' only to make the exact same prediction in 2014, 2015, 2016 and no doubt in 2017.

    These predictions are problematic because people take them seriously. We had a poster nearly 2 years ago who refused to buy a home for his family because he listened to the doomers and believed the market was about to catastrophically collapse. How much capital growth has he lost in the last 2 years?

    The other major issue with constant reports of a market bloodbath is the doom spruikers crying wolf. People might believe them the first 5 times they claim the market is on the verge of collapse but eventually they will stop listening. The problem is then the important message of the very real risk of a downturn is lost in the noise of the doom industry.

    I don't agree. I think we should dismiss predictions such as an Australian property collapse in 2017 taking down a major bank and we should discuss what will really happen. Investors need to be educated about real risks and what really happens in a correction, not some fantasy invented by a spruiker to sell some books. Nowhere in the doomers predictions do they talk about low or no growth in Sydney for 10 years but that is exactly what happened in the last correction/consolidation phase. Investors need to know this. I also think it is very arrogant for a spruiker to try to predict the (almost) exact date of the collapse. As you know, markets don't work like that and I would never trust a person claiming to know when things will happen.

    TL;DR Of course Sydney and Melbourne will correct. We just don't know when and we should not trust people who claim to know when the correction will happen.


    (1) http://www.news.com.au/finance/real...7/news-story/4fe05fed1c277a096df33242a26caf6c

    (2) http://www.news.com.au/finance/econ...s/news-story/866d2fdee41b1227ce654f66ed8d9837
     
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  19. MTR

    MTR Well-Known Member

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    Instead of developing townhouses I am going to build me one of them nice little bunkers:p
     
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  20. dabbler

    dabbler Well-Known Member

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    You might be able to get 4 in under a decent block & rent them out to basement dwellers as well as the 4 above ground, and when the zombies arrive, you can quadruple rent for 3 of the bunkers.