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

Thanks Ted.

I'll try that tuna milkshake (with chocolate) next weekend.

 

Still significant news nonetheless as quite a number in Perth are in trouble but yes "some" is needed

 

yep that's right laugh at perth greedy people it couldn't possibly happen to you. These people deserve what they get, you say.

Unless you have no debt and don't rely on a job for income ....

No no no no I'm wrong, the east coast boom will last forever. Don't look at history this is the first time prices will go up and stay up and you will have secure jobs and no health issues forever.

Will visit this post again in a few years. I can only surmise that those that think that none of this could happen to them are new in the game (under 10 years) or live in ivory towers.

 

It's pretty sad. A young guy I work with is quite stressed about this as he has an IP there (used to live there before moving to Sydney). It's a unit too so it's a double whammy

 

That's not ideal.

And unfortunately, probably and expensive and stressful, lesson in how markets can go up, and down.

 

That may be so but they are also more likely to fall from greater highs exposing owners to larger risk. They will only be in demand in a downturn because they become cheaper compared to what you describe as 'boondocks'. This is a pretty shallow observation that assumes everyone wants to live in the inner ring - they don't.

 

This is what Colin wrote:
"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."

Emphasis mine. Buy solid properties that appeal and are within the reach of the majority of middle market owners. People can and will trade up into them from outer areas. People in the premuim end who cannot hold onto them for any reason can downgrade into them. The middle segment tends to be well supported and insulated best from economic extremes.

No mention of inner ring anywhere. Though, "inner ring" will always be supported by virtue of location. The very premium end (e.g. waterfront and ostentatious properties) are economy sensitive. Strong economy, CEO bonuses, buoyant stock market, high demand for resources, overseas buyers then premium property prices can shoot up past what they really are worth. But if there's a bad economy, stock market crashes, resource sector collapse, change in government policy then they may see severe price falls.

 

Thanks for calling me shallow and we havent even met

Got no idea how you drew the conclusion you came to. Wasnt referring to inner ring just not to far out and not to expensive, besides there are plenty of people wanting to rent in the "inner ring".

Cheers.

 

by referring to the boondocks it was a pretty clear inference. lets face it.

 

We have a 2x1 villa unit in Kalgoorlie; rents have dropped from $310p/w at height of Resource boom, down to $260p/w, and haven't gone back up since.

These sorts of units seem to be holding their value reasonably well; haven't gone up much in last 3 years, but haven't crashed either.

As Colin Rice said; well located, good condition etc will continue to be ok.

As for Melbourne where I live; I haven't ever seen much of a slump in prices in almost 35 years - except for a few during that very high interest rate period around early '90's.

 

So perhaps saying inner and middle ring would have been better? But Colin comment is that the premier stuff also gets hit too. To be best insulated you buy something that in the 70-odd % of stock that sits between the extreme outliers. Being near the median or slightly above or below is generally the safest place to be.

 

Overall the Perth market has been almost flat for 10 years. We had a huge spike just before 2007. We had modest growth 2010-2012. But when averaged out, growth 2008-2017 has been around CPI.