Is now the worst time to buy?

First time in, well, ever that we're having an election around housing.

Nine weeks from this coming Saturday (most likely).

A blink of the eye in terms of investing and making major buying decisions.

Labor wins and there is going to be a seismic shift in the rules.

What is nine weeks? Nothing

 

in my opinion, when all the major markets are plumetting or declining, there generally wont be an area which is booming, at best, just doing better then the plumetting or decling area? ie in a different part of the cycle, but still in the same half

 

For me, I am going to see this FY out before I make my next move. Like I said in some of the other posts, most likely this may be my final purchase for a while.

 

i think it's a bad time to buy for ips that rely solely on rent without doing anyting and expect capital growth. i got a friend who says he had a properties worth 2 million in sydney couple months ago just said it is now 1.8 Mil (he mainly bought and hold riding the waves)

It's still ok to buy properties which you can manufacture growth either through upper storey extensions, extensions, renovations or dual occupancy. Whether the market goes down slightly if you can manufacture the growth you will still be up.

 

...meanwhile, my clients are picking up deals left, right and centre in and around Brisbane.

 

Soon it will be very great to buy.. im just waiting now before i go out to haggle haggle haggle !!!
My chosen areas of Lake Haven...San Remo..Charmhaven are still going up..so i cannot get another IP there in a growing market.
But areas such as Western Sydney are slowly going down.
Stay away from Green Square near Sydney Airport. Omg so many units being built down in South Sydney.Waterloo. Green Sq etc oversupply
Yeah my own apartment here in Sydney Darlinghurst had lost about 40k in the last 12 months.
Penrith Liverpool are my next choices for IP 's.

 

I do not believe that all major cap city markets are in a downward trend right now, all at the same same.

Hobart and Brisbane are examplea here. Whilst they arent booming to Sydney/Melbourne 2013-2015 years, they are holding their own. Even Canberra has had gains in recent times...

... Though as others have said, a lot rides on the outcome of the election.

All I know is that getting credit (mortgages) is getting much harder. Dont jump in foolishly, hastily for the sake of it, but by the same token if you just 'wait and see' for another couple of years, that could be bad too. APRA could come and slap more rules on lenders, or any other variable like policy, economy etc. Could play out.

 

Lending is not hard really, only for those with a handful or more does it get tight, if your on a good income, you should be able to still do quite a bit if you buy well.

For the normal Joe or mum and dad investor, things are ok, if Labour get's in though, you may see it all die off which could have a domino effect.

 

I agree ...every city has its cycles. Have a look at Perth....it think it will bottom out later this year. And given that it is down...the buying opportunities there are phenomenal...I am shifting through bits now. Found a H&L within 1 klms of beach for 330k fully complete unbelievable. Still selling quick if they are good value..someone put a deposit on this already by the time I called.

Also...APRA is not an issue for certain lenders.

 

Which lender?

 

Non-conforming lenders. Pepper, Liberty, Bluestone, Resimac, La Trobe et al.

 

Growth still relies on those without a good income being able to borrow.

 

I fail to see how the election has much to do with properties, saying that I don't follow politics. Can someone explain to me what's the worry here? Don't labour government generally prefer spending, hiring more government workers ? if so won't that be great news for property investment (more jobs + more infrastructure = property price up)

 

So many people are influenced by external factors such as elections et. al. I hear it all the time with both buyers and sellers. For me, and what I explain is that if the timing is right for your personal situation, then the timing is right. If you wait for an election 6 months out you are effectively on the sidelines for 17% of the time.

 

Yes, of course.

But this would mean we are assuming everyone borrows the maximum and buys the most expensive property & I doubt that is the case for owner occupiers and people with one IP.

it is not crippling or a complete stop, a slow down, yes.

that is my observation and assumptions

 

Borrow responsibly.

 

Does this news contribute to this thread? So possible rate cut near future?

Consumer prices fall for first time since 2008, sharp inflation drop raises chances of surprise interest cut - ABC News (Australian Broadcasting Corporation)

 

Maybe as early as next month.

 

Yes it certainly does, and shows part of the story and what shape our economy is in..

Here is another snippet from Steve McKnight who seems to be one of the gurus who always has his finger on the property pulse

Capital Gains Tax Concessions Under Threat
The other big property-targeted policy of the Labor Party is the reduction of the 50% Capital Gains Tax discount for investors to only 25% - effectively bumping up the capital gains tax payable on the sale of an investment property by half.

So if you plan on buying one property, and realising the capital gain to turn one property into two, and two into four - or if you plan on retiring off your capital gains - then you’re in for a rude shock, and a great big tax bill in the future if Labor gets its way.

The Myth of Doubling Property Value
For years, property spruikers have peddled the line "Property doubles in value every 7-10 years."

It only takes a quick look at actual property price statistics over the last 100 years to see that this is absolute garbage!

Investors who stick their heads in the sand and continue to buy into this unsubstantiated myth risk finding themselves stuck with poorly performing assets that fail to deliver any substantial wealth for retirement.

Flat Spots and Drops
15 years ago, the other catch-cry of property spruikers was "Property always goes up in value."

Today, we know this is not true.

For example, just last week it was reported that Sydney median house prices fell in value by 1.5% in the last quarter.

And although there are still periods of growth, the reality is they happen in short, sharp bursts – inconsistently between suburbs and with long periods of flat or declining prices in-between.

If you’re an active investor you can monitor the market, buy in quickly, take advantage of growth where it occurs, and sell out to take advantage of growth in other areas.

But passive investors will go through long periods of neutral or negative returns.

Availability of Finance
One factor that supported the property boom of the late 1990’s and early 2000’s was the deregulation of the banking sector - which led to easier finance for buying property.


More people with access to finance means more potential demand for property, and more demand can lead to higher prices. But the opposite is also true…


After the events of the GFC, banks have been much more hesitant to open the financing floodgates. And our regulators have introduced even tighter lending rules and tests over the past couple of years, meaning fewer people qualify for loans or can afford to borrow as much.


In turn, this means fewer buyers in the market and less upward pressure on property prices.


So - if you profited from the boom of the 90’s and 00’s and are hoping that cheap finance will deliver the same kind of returns from buy-and-hold investments over the coming years, don’t hold your breath.

need to be an active investor not a passive investor, hold your breath and hope for the best..

 

What's the rent like on something like this though?