Real Estate Myths Destroyed

A lot here I can agree with and in table format for easy reading:

http://rationalradical.me/wp-conten...ate-Myths-Destroyed-Cheat-Sheet-two-sided.pdf

Though I think some of the 'corrected mythology' entries swing too far on the pendulum, becoming a lie or at least speculation themselves.

via: Real Estate myths are being destroyed: "There's never been a worse time to buy..." - Rational Radical

 

Worth a read. Destination some useful perspectives there but also some incorrect statements made ...

 

Good article I agree with it. Yet as I look at the sold section on real estate I am constantly amazed

 

There has never been a worse time to buy? Seriously? Ever? In all parts of the country? That writer did himself a disservice with the constant labels and need to go OTT imo, basically doing what he is bagging spruikers for, just chasing a different result.

The table had some merit though, thanks for sharing

 

Read a couple and had to stop reading. The writer is completely clueless imo.

 

I agree with some of the cheat sheet which is essentially quoting a lot of the BS that is spread around, we have all heard much of it before. However the article makes far to many sweeping generalisations for my liking and leads me to question the motivations of its author.

 

Yup. It's the same nonsense largely from people with limited to zero success creating wealth.

Just my opinion

 

Yep, generalised a lot

 

Agree with this sentiment, which is why I highlighted the cheat sheet first.

That said, most people are a vested interest/talk their book/put their money where their mouth is, so there's no need to question the author's motivations more so than anyone posting here or writing anywhere.

 

Thanks for the link,interesting reading,but if the gst tax goes into 15%plus,and that will also compound the entry costs in new property,where old properties will not..imho..

 

WTF is a "boondoggle", and if it is overpriced, why do I want a piece of it?

"Mortgage interest is dead money / Negative equity is undead money." - was this written after a few moggies, rhoies, a couple of redbull and vodkas while sitting infront of the Amitiville Horror?

 

It's close, but they fall into the same trap as the spruikers and true believers. The "Corrected Mythology" then becomes the same as the "Myths, Lies & Platitudes". We should fix the "Corrected Mythology"

For example:

Corrected Mythology
The economy is weak and set to deteriorate significantly, so house prices will fall, and fall far.

Corrected, 'Corrected Mythology'
The economy is weak and set to deteriorate significantly, so house prices will fall.

 

Which of 'Corrected Mythology' do you completely agree with? I like these:

• Rental costs are not keeping up with incomes and inflation.
• The rapid growth of investor lending is of great concern, enough so that there are now regulatory controls on investor lending.
• Our housing is mediocre quality at best, and getting worse thanks to the boom.

The last one is a generalisation too, but having inspected a number of new builds in Perth recently, I was very unimpressed with the quality.

 

"Completely agree with" is strong wording

I agree mortgage interest on a PPOR is as dead money as rent.

I agree international investors will find it more difficult to buy Oz property.

I agree our banks are some of the riskiest in the world given the high level of exposure to resi mortgages.

I agree record household debt is a problem and can't grow exponentially.

I agree unemployment doesn't have to rise for house prices to fall.

etc

But as I said in the first post, I don't agree with all the correct mythology entries.

 

I don't believe the author gets invited to many BBQ's

 

Makes me want to slash my wrists.

I agree with some of the things he wrote however the bulk of it I disagree with.

Yes some markets are busting but there are also some markets that are booming.

 

I would assume most people here including myself look at real estate as a way to preserve wealth and increase it, nothing more.

As for the author's motivations I'm not so sure, the piece reminds me a little of someone replying in the comments section in Macrobusiness. Hoping praying... salvating at the possibility of a property market bust.
I don't wish that kind of misfortune on anyone, whether they bought in a mining town or an over priced OTP unit in Sydney at the peak of the market.
Some balance in any article adds weight to its credibility as no one knows how individual markets will play.

 

I fundamentally agree with the entire article, I don't agree with the magnitude or extremism of the outcomes though. The author has basically taken a bunch of truthful comments and taken them to the worst case scenario ending level on every line. I'd be surprised if even half of those "corrections" ended up being accurate.

Basically the economics behind the article are sound but there is a clear agenda to be a doomsayer that makes the overall vibe of the article about as reliable as the spruiker column is in reverse.

 

How about the misfortune of younger generations who don't have the same opportunities to buy property at low multiples of income? Investors here salivating over capital gains as families miss out on affordable property as a result of their greed...

That's the other side of the coin, if you resent those calling for a 20-30% crash, then you should also resent those calling for a 20-30% boom.

 

that's a fair point actually. in fact a scenario similar to what perth has gone through is probably the "fairest", no major crash overall but a combination of no growth, wage growth in the meantime and lower rates has meant a massive increase in afforability vs say 2008.

sydney needs something to happen too, i dont wish crashes on anyone as they can be very traumatic for those on the receiving end, at the same time you're right, what about those who are trying to buy now and having to put up with the absolutely stupid prices in so many parts of the city.

it's a tough one, im definitely conflicted. the capitalist in me obviously enjoys seeing increases but the other side of me feels for those forced to pay stupid prices. then again the capitalist in me does also feel if people werent spending so much on housing they would have more money and time to spend on actual productive things that the whole country could benefit from.