Rents to rise, house prices to decline under Labor’s negative gearing policy: SQM

Discussion in 'Property Market Economics' started by standtall, 21st Mar, 2019.

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  1. Silverson

    Silverson Well-Known Member

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    Mate I'll be honest, lead indicators, triggers, metrics are things I and dare I say 99% of people can't read or see, if we could we would know market direction and be squillionares. I think the key to not only protecting your portfolio but also sustainably building one for me personally was picking an all season strategy that allows you to sleep at night and more importantly stick to your plan. For me this is debt reduction and to not be over leveraged. The biggest thing for me is opportunities, if your in debt past your neck and borrowing power is shot you miss the opportunities! As a kid I would always hear the rich get richer and all the rich buy when things drop, to be able to do this you need to have borrowing capacity/deposit/cash etc.

    If you want to go one step further, pay attention to people's moods/behaviours/discussions towards investing, we are sheep, when enough people say investings not the 'in' thing sentiment turns and prices reflect this.

    My opinion only, don't follow me as I'm probably lost
     
  2. Silverson

    Silverson Well-Known Member

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    Another fantastic piece is the fear and greed index by Ashley Ormond maybe @Nodrog (sorry for dragging you to a property discussion) can post a link to the 30 page article, I think it's the 2009 fear and greed index.
    Even though it's linked to the share market and prices dating back to the 1800's the clear message is credit, booms are caused by easy credit and busts are caused by the turning the old credit tap off.
    Take the time to read it, then relate to property. Again opinion only as I have my L plates on too
     
  3. Nodrog

    Nodrog Well-Known Member

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    See attached.
     

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  4. euro73

    euro73 Well-Known Member Business Member

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    You arent that powerful old mate
     
  5. MWI

    MWI Well-Known Member

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    No one has a crystal ball into the future, do you?
    Anyway as I read from Fear and Greed, it happens every time, century after century, so nobody will now what will happen and how long the credit squeeze will last, how long will they keep taps closed or open or drip them or flow them...and so on...nothing lasts forever and change is inevitable! So let's adjust our strategies as they occur, and not worry about things out of our control! That's how I like to look ahead!
     
  6. marmot

    marmot Well-Known Member

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    Unless someone is living in a cave and completely off grid its pretty impossible to not see whats happening with the local and the global economy at the moment.
    Our local economy is struggling , its only being held up by strong commodity prices.
    How do you think our economy would possibly handle an Iron ore price back down around the $50 -$60 mark in a couple of years time.?
    Unlike 2008 , the Chinese economy is starting to slow down and has some challenges to meet head on.
    Global bond markets are showing a deterioration in many large markets , and the Australian market.
    The days of wage growth outpacing inflation by 1.5-2% are long gone, and the banks have had to act accordingly.Low wage growth affects everyone in the workforce , those paying of a large mortgage, those trying to save for a home and those in the rental market.Older people with property already paid off are the least affected.
    There is no money tree out in everyones garden and the banks could not keep on lending out easy money to many households in the knowledge that wage growth has stalled .
     
    Last edited: 25th Mar, 2019
  7. sash

    sash Well-Known Member

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    Yes Mister Faulwty....
     
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  8. euro73

    euro73 Well-Known Member Business Member

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    You may have missed the point . He wrote “I “ might cause another recession .... I said HE wasn’t that powerful .
     
    Last edited: 25th Mar, 2019
  9. euro73

    euro73 Well-Known Member Business Member

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    Like I said , NG is the least of investors issues .
     
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  10. LibGS

    LibGS Well-Known Member

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    Lots of opinions here, little that looks like evidence or facts.

    Heavily redacted Treasury advice to the Turnbull Government on the likely effects Labors negative gearing and CGT policies, Treasury noted that:

    “previous changes to negative gearing (1985-87) and the introduction of the capital gains tax discount had little discernible impact on the [housing] market”.

    The quote in question is from pages 12-13: Negative gearing documents released to the ABC

    This was obtained from: What really happened to rents when negative gearing was abolished? - MacroBusiness