Families in WA reach breaking point as the state's economy collapses

Is this coming to Melbourne/Sydney?

How Sydney and Melbourne can learn from Perth

Hmm..m

 

Maybe I am bias but well located and maintained properties will always be in demand. Buying out in the boondocks or at the premium end of the market will always hurt when things turn sour.

 

[Start of rant]
Nothing new, greed and over leverage are an issue in any falling market. Will this happen in Melbourne/Sydney? If the unemployment rises then hell yeah. What's the I hear? But but Sydney/Melbourne have so many jobs to go around. Not with a constant flux of new migrants (interstate and from other countries) and the perpetual downfall of brick-and-mortar stores will effect Retail and Service sector jobs like no tomorrow.

Amazon is coming, others will follow. Robotic warehouses, staff less brick and mortar stores.

We need more exports, selling each other stuff and artificially pumping up asset values is bound to have consequences.

Having said that the smart investor will de-leverage and wait for unemployment to rise and the firesales will begin. All the while hoping his/her job is stable. Funny world.

[End of rant]

 

I also feel that if people do not have an snobby attitude to some of the work that they do, they should be fine. Desperate times comes with desperate measures and know it can be difficult if people suffer from health ailments and personal struggles but hiding in the sand is not going to make your troubles go away when the pressure is on. I also agree with the others that I am not concerned of the state of NSW in comparison to Perth. Comparing apples to oranges.

 

You're right to a point. Kinda depends on how much debt you took on.

 

At the end of the day, I don't want anyone to go through financial hardship and wish the best for everyone.

 

Fire sales would be nice, for an example refer to how much opportunity @MTR had in the states about 5 years ago!

 

Maybe this should read

SOME families in WA reach breaking point however the vast majority are doing fine.

 

Yes, but reality usually doesn't make a sensational attention grabbing headline.

 

Don't forget, there are real, fragile people behind 'fire sales'.

There is depression, desperation and worse.

Have a heart.

 

very true, but sometimes opportunity for the prepared comes at the cost of losses for the less prepared/fortunate.

I wouldn't wish it, that's for sure, bad times are bad for all

 

In short, basic way I see things went to shiet in WA;

Resource/Construction Boom!
State Gov raking in the $'s from it dropped the ball on consistent income/employment producers.
Heaps of new people move to WA for it, "assume" they might stay after constructions over (Wrong!), lots of new approved apartments/developments to accommodate, borrow heaps for infrastructure.

The naive get cash rich (cashed up Bogans), many who had basic jobs in Perth earning ~50k pa (many less than this) found themselves up north (fifo) during construction earning ~120+k pa with ancillary operations etc, banks lent/refinanced them $'s based on this income to purchase new car, boat, harley, house etc etc etc.
Construction phase winds down/finishes, they hoped during/by this time they would have scored a full-time role with a mining Co, maintain that income they'd gotten used to, however find themselves back in Perth competing with many others in the same boat for jobs paying ~50k or less pa, few full-time positions available, mostly casual, sell of the toys for what they can get, trying anything to make ends meet with repayments on their house they can no-longer afford.
Many marriages also ended during this time, regularly away from home 2+ weeks isn't good an any marriage.

Those who stayed in Perth, like those who stayed over east (didn't chase the $'s up Nth) maintained their consistent Perth jobs, possibly promoted, loans on homes, toys etc based on the consistent/balanced income, most are possibly still doing ok.
However even some of them were given big pay rises to stay in Perth, working for Co's supplying the resource boom, who went under or downsized.
Theirs also many small contractors with employees who went bankrupt due to main contractors not paying for works on Perth construction, i.e. new hospitals etc.

Median price over past 20yrs has been a yoyo, some got in at the right time, many didn't.
I know of a guy who bought a Penthouse apartment for 1.6mil, last I heard he was having trouble unloading it for 400k.
Plenty of stories like this up & down the coast of WA.

 

pretty sure 'collapsing' is overstating it somewhat.

Also, re - In Mandurah, about an hour and a half from Perth, a home five minutes from the shopping centre and three minutes from the beach can be purchased for just $399,000.

50 minutes from Perth is more accurate. And the drop happened literally 10 years ago - very well documented, no surprises there but why not keep rolling it out as supportive evidence?

 

Crazy stuff really, those properties in US at $35,000 are now selling for around $165,000, what a short boom/bust/boom cycle..... buy in in 2011, 5 years later and the rest is history.

 

No need to get too emotional. Property is just an asset that is bought and sold. Some investors who lever up too much go bankrupt when the bad times come.

At the end of the day, its just a business transaction, just like selling and buying a stock or a bar of gold.

@MTR : So it seems in USA property IS "traded" just like stocks/commodity lol, hence the propensity for large swings in pricing.

 

And buying at approx $35 000 Aussie dollars, would probably convert to about $210 000 Aussie today!

Hope I'm not detracting from thread too much..

 

yes about right. When I was buying the Aussie dollar was around 1.05, I think its around 75 now.

 

As sad it is for those families, I'm watching WA to bottom out and then I'm heading over there to pick up a bargain but from what I hear the bottom is still some way away yet.

 

I read that article and I nearly threw up.

No, it wasn't the article, I have been drinking Coronas today and I can't seem to hold them down too well.

Yeah, pretty sad for an engineer having to work as a security guard and all that.

I might switch to Aussie beer and toast the Sydney market on another stellar auction performance.

 

I'm glad you didn't describe this in detail as unfortunately I'm a sympathetic vomiter.

Seeing or hearing about someone else throwing up... well, you know.

And Fluffy, my Rottwieller, suffers from the same affliction, so all round I'm glad that article didn't cause any genuine upheaval.

And, Datto, I also appreciate the fact that you didn't down a luke-warm tuna milkshake just prior to reading that article, and then tell us about it.

And, I'm also sorry for that guy having to work as a security guard too...