Don't Buy Property in 2020

Some backwater currencies lost their value and I need to go back into old history books now for more examples.

I don't need a history book to find all the many threads on this forum from people asking for advice re bankruptcy due to their dud properties. Where are all the threads from people on here who held cash through a time of instability and found it's purchasing power evaporated by 75% ? come tell me about it when you find the links to them.

Cash is one of the lowest risk asset classes you can hold.

 

I also think the distinction is: cash is trash, but cash flow is king.

 

Cash is trash sounds like something the Bitcoin guys used to say. I miss those guys. They're having some sleepless nights of late.

 

True. Not a bitcoin guy myself, but I think it has a future.

 

Incorrect from 1st July it will be illegal to make purchases over 10k with cash. Your cash will be useless at a self serve petrol station, you might find you cant even get those goods you have to deliver cash for.

 

What do you use to pay for petrol? 1 night stays in Airbnb's, cheap wine, Subway vouchers? or the electronic form of cash.

I say cash is king right now but I'm not talking about hoarding large amounts of wealth as physical cash under your mattress.

 

What are you talking about then bill? Stop using riddles.

My opinion (uneducated opinion) is that cash is dangerous, I have many family members that are “savers” and have done for 30yrs.. Saving huge amounts of their net wealth, only to find out they are constantly out run by the market.

Inflation, monetary policy, and currency manipulation makes this group look like idiots.

 

Well of course there are better performing assets out there over time. I'm talking about moving assets into cash deposits during times of financial crisis.

You didn't get the memo on what is happening around the world right now? Where do you think all the money from stock market is going? It's taking flight to less risky asset classes.

 

Frydenberg in fresh crisis talks with RBA

Frydenberg in fresh crisis talks with RBA, regulators

People who have their finances in order now and can be prepared to handle unexpected events will be better off. A lot of people wont.

 

Cash is almost never king

 

This is why RBA is having to inject billions into the banks to keep things going and having crisis meetings with the government on a Saturday.

 

Mon3y from the stoxk market is taking a 25% hair cut.
Than goibg into gold and cash.
Waiting for the rigjt

Exactly my point. Government will inject liquidity and devalue currency.

Like i said almost never.

Aussie dollar is fallibg like a brick. Product inflation is inevitable. Money in the bank unless deployed in depressed assets or other ventures will be worth less.

 

The comments and predictions on this website are insane ,

just look at other countries in 2008, see what happened . Stop thinking australia is a different and economy is an economic , australia is differ t is a mantra that’s fed to us

our banks are zombie banks it’s as obvious as the nose on your face and people are still talking about property rising

as for cash is king, those with cash reserves will clean up in 12 months , there has been 2 oppurtunities in the last 30yrs to make as much as the upcoming one , unfortunately it’ll only be for the lucky few who have the resources

as for those guys working in construction and still buying $100k cars on tick ...

Everyone else batten down the hatches and sit on your hands for the next 6 possibly 12 months

 

Dot com bubble
GFC
COVID

so once every 8/9 years.

PS luck has notbibg to do woth it.
Ita being prepared.

Warren Buffett under preformed the last few years putting away cash. Every said he was underperforming loosing his touch.
Now he will have many opportunities. He didnt get lucky ,he got prepared. As did many others.

The game of money is not luck it is education and execution.

 

yes your are not far off the mark
But there is a generation here living on tick cos the good times keep rolling

It’s a house of cards which is about to fall
And the likes of you will be able benefit more quickly than you do in any boom

 

my Opinion, if things get as bad as everyone is thinking all you have to do to thrive is survive. Unemployment will rise, debts still need to be repayed.
It’s a health crisis at the moment however it will become a credit/financial crisis moving forward. Last time I checked very few purchase property with cash/outright. If the banks cut lending, prices for housing will follow the lead of the stock market, albeit not the same extent in terms of percentage losses.
Purchasing/repayment ability IS KING, at this present moment cash/cashflow is best at doing this. As posted in earlier threads I had made my last property purchase in 2013, since I have made it priority to pay down/fill offset and release equity in form of loan top ups.
Reason for this, when opportunity calls you have funds at hand to make the most out of tough times. If opportunity does not present no bother, as buffet says “you don’t have to swing at every pitch”
I have over 70% of my wealth in property and am very optimistic about propert long term. I would however prefer to invest in Australian and global business as opposed to speculate on debt fuel Australian property...
Take of this what you will, property is an amazing long term investment however at current prices and debt levels I’ll be sitting on the property sidelines.
Not a property vs shares debate just my opinion

 

Long term is not a problem
70% down in Dublin , 10yrs later prices here pre bust
In the meant time if rent and yield went through the roof due to lack Of new stock

long term is never a problem

But the tide of going out and we are going to see who is swimming nude , honestly it could be a bloodbath but for those who can hold the asset it’s not problem whatsoever
But those with development and business loans drawn down and cross guarantees etc its a major problem

 

Ray Dalio said cash is trash around a month ago. He doesn’t look very smart now. His fund’s down 20% also just at end of Feb.

 

Yes, I read that too. He's a legend of the street, and his all weather fund has a great record of riding through these sorts of crashes. Is this one different? We should know by the end of this year. Too early to write off Ray Dalio because it is very early in the correction, and everything is liquidating at the moment.

The question is, where does the capital flock to once things have settled down and the margin calls have been met?

 

Agreed. You cant pick the bottom.
We can judge his fund in 1year