First Time Homebuyers Priced Out of the Market, 90% Can't Afford

You don't have to go as far as Ireland. Some people in Australia lose much due to poor decisions and limited understanding. The middle majority buy 1 or 2 and then stagnate. Then there are the minority that will do well because of the way they approach it. So the issue isn't Ireland, Japan or USA. The issue lies with the investor, imo.

And to answer you directly with regards to Ireland - No. I wouldn't waste my time making comparisons with Ireland.

1.Learning the property basics.
2. Understanding how to approach property investment like business and not some bored hobbyist
3. Understand how to utilise strategies property
4. Understand risk mitigation for individual circumstances

Focusing your time on those aspects (rather than Ireland) will yield much better results.

 

To a point I agree with you, it would be better for productivity if more money was spent on starting new businesses, research and development and new industries. Investing in property isn't a zero sum game though, on a small block of flats we pay management fees of 8%, hire a gardener for 2 hours per month, pay insurance, pay for yearly termite inspections, pay for a smoke alarm service, contribute to the council via rates, recently paid for a new kitchen install by a cabinet maker, regularly need minor electrical work carried out, we have had an endless stream of small jobs for a handyman, had a locksmith attend and had some plumbing work carried out. I could go on but the point is that these jobs add up and help to keep the economy moving as well as providing resonably priced accommodation. Many OO would probably do many or at least some of these jobs themselves.

 

MGF said: ↑
" An investor buying an established house and doing nothing but hold it during credit expansion contributes zero productivity or wealth growth"

Tell that to the part of my portfolio that made about 3mil net worth just doing that.

Nonsense galore.

 

I'm not asking you to waste your time making comparisons. I ask you again: is there zero to be learned from the Irish property bubble in regard to Australia?

 

It still does not change the fact a house is a nonproductive asset.

 

There is always something to learn from most things. That's the problem with most people. They don't know how to measure what is worth spending time on and what isn't. So they usually spend their time on various things that wont amount to much in terms of their success. Did they learn zero along the way? Of course not, I'm sure they learnt somethings. But open a tabloid magazine and you can also learn something.

 

Who gives a sheet? As long as the asset helps you to build wealth! I don't care if its non-productive, semi-productive or reproductive!

 

This is still not productivity however. No productivity gains are made here. Every single one of these things occur anyway. In addition, should the owner do them rather than hire, they then have extra capital they can put to use in other ways - either investing in productive assets or consumption or other things.

 

You're still giving very vague answers. Is there anything to be learned from the Irish property bubble that has any relevance to the Australia property market?

Anything at all? Can we learn from their overbuilding? Can we learn from their lax credit regulations? Can we learn from their reckless lending? Is there anything that happened in Ireland that has a parallel in Australia?

 

Investing in nonproductive assets distorts the entire economy and has terribly negative effects.

Build a new machine, invent a new process, improve a new process - these are the sources of wealth and rising living standards.

Buy an existing house using reckless credit and hold it? This distorts investment away from useful things into useless things. No processes improve. Businesses are starved of capital. The higher mortgages required depress spending which in turn harms businesses.

Spending from one individual is another's income. That's how money works. People with whopping mortgages don't spend very much in the economy which means the useful businesses suffer and collapse.

So yes, it does matter greatly if a giant malinvestment into nonproductive assets occurs.

 

Your trying to change the seasons. You cant. All you can do is work with them. To set your sail utilising whatever wind blows to take you where you want to go. (Jim Rohn)

You cannot change the seasons my friend. Its all you have.

I'm out. Good luck.

 

I didn't say they add to productivity but they contribute to economic activity.
An OO having a massive loan which takes them 30 years to pay off with little funds left for consumption or anything else is where I tend to agree with you.

 

Again you don't answer.

Can we learn anything from any other country on any topic, ever?

Can you even say yes to that?

 

Do tell all, we are waiting with baited breathe.

 

Of course we can learn from the experiences in other markets and our regulators have acted despite prices only growing recently in 2 capital cities.The rest of the country has generally had subdued prices for a number of years.
Savings rates are now much higher than before the GFC. Consumers are now much more cautious.
There are plenty of warnings in the media presently about excessive apartment supply in several CBDs about to come on line.

 

I have answered you many times. You just don't like what you hear. Not my problem.