Property values never go down....

Discussion in 'Investor Psychology & Mindset' started by Chris Au, 22nd Apr, 2017.

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  1. Chris Au

    Chris Au Well-Known Member

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    I decided to post this thread here as the article is more about the approach to investing and that as investors we need to be prepared that values can, and do go down, and to have strategies in place to manage the ups and downs of investing.

    Property values never drop - The 5 biggest mistakes property investors make - April 17, 2017

    (posted this article for the commentary, don't mind the ads. I don't necessarily agree with the property selection points at the bottom of the article, but that's for another thread that's been covered many times over.)
     
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  2. Perthguy

    Perthguy Well-Known Member

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    I can see someone who bought in Melbourne or Sydney in 2013 would think that property prices never go down. Nearly 5 years of solid growth with no downturns is amazing.

    In contrast, some areas in Perth peaked in 2007, crashed and have not recovered to 2007 prices. People in Perth with negative equity understand full well that prices go down.
     
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  3. Colin Rice

    Colin Rice Mortgage Broker Business Member

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    Hope for the best and plan for the worst, but sometimes you need to put the proverbial's on the chopping block.
     
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  4. kierank

    kierank Well-Known Member

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    I bought a property on the GC and my purchase price last year was 17.6% below what the vendor paid for it 10 years earlier.

    Even after good growth in the last 12 months, today's value would still be below that the previous owners paid for it.

    Yep, property prices can go down (even very good property) and can take a looooong time to recover, especially if you pay top $'s just before a crash.
     
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  5. Coota9

    Coota9 Well-Known Member

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    Its an area that has been well publicised but Moranbah is a classic example..

    Moranbah.PNG
     
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  6. Chris Au

    Chris Au Well-Known Member

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    Yep, even in the larger areas/capitals where people think there's a diversified economy, population etc etc, prices still go up and down. Have a buffer and be prepared to hold if necessary, or understand how you'll get out of the hole if you need to sell at a loss.
     
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  7. Chris Au

    Chris Au Well-Known Member

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    Haven't looked closely at the mining areas - pretty big swings there!

    2016 was a time when many are just moving out. Wonder what 2017 will be like?
     
  8. Biz

    Biz Well-Known Member

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    That's some nasty ****!
     
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  9. kierank

    kierank Well-Known Member

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    I assume you left out a space and meant 'dollar hit' :).
     
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  10. Chris Au

    Chris Au Well-Known Member

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    Nice! :D
     
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