NSW Sydney prices fall 7.4 pc, biggest drop since 1990: CoreLogic

Discussion in 'Where to Buy' started by Pete Arendt, 1st Nov, 2018.

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  1. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    On average, most people will be fine and make it work since the early days of civilisation.

    Getting back to basics, life............. its a risky business.

    ta

    rolf
     
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  2. kierank

    kierank Well-Known Member

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    I don’t mean to be disrespectful but the above brought back memories which made me chuckle.

    When we bought that IP in 1992, close friends of ours presented a similar argument to us.

    They presented all sorts of numbers, statistics, etc in a vehement attempt to convince us not to buy property at that time. They weren’t as they felt it was wise/best to rent. Neither side would give an inch.

    In the end, we compromised. We bought that property and they were our first tenants (rented it for 8 years).

    Roll forward 26 years. We own a multi-million dollar property portfolio and they are still renting (not one of ours).

    Our approach was to jump in the canoe and ride the rapids. Theirs was to sit on the embankment and wait until the river calms down.

    Nothing wrong with either approach. Interesting we have got through all the rapids and made it out onto the lake - we are so glad we did as the scenery is beautiful.
     
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  3. SoroSoro

    SoroSoro Well-Known Member

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    Time in the market over timing the market. That's why I'm still tempted to buy in Brisbane. Part of me wants to wait this out to see if the global and national economy take a dive, but the other part says stop trying to time it. I'll start looking around early next year.
     
  4. kierank

    kierank Well-Known Member

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    Nope.

    When Sydney and Melbourne were going gangbusters, Brisbane was just plodding along.

    Now that Sydney and Melbourne are crashing over a cliff, Brisbane will just plod along.

    In our area (SE Brisbane), the last boom was in 2007. We have been waiting 11 years so far for the next boom. I was hoping it would be this year :eek:.

    I don’t think it is likely that Brisbane would boom (in 2007), crash, stagnate and then crash again.

    I have been wrong in the past. Likely to be again this time :D.
     
  5. TheSackedWiggle

    TheSackedWiggle Well-Known Member

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    Your chuckle made me chuckle :),
    I have missed many opportunities purely based on value analysis,
    for eg in Sydney I thought 2015 was expensive but it rose further and with a bang, then I thought 2016 was crazy... bang it rose even further in 2017... :( :confused:

    my current thinking is that impact of ease/difficulty in getting Credit was the missing link in my value analysis back then, nothing drives boom like ever increasing credit.

    Back then I knew I know,
    now I know I don't know,
    I am open, eager and appreciative of diverging thoughts and ideas.
     
    Last edited: 3rd Nov, 2018
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  6. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Objectively, they loved you and tried to keep you safe.

    Often perceived safety comes with our gold fish bowl and subsequent "prison".

    I have had the same discussion with 1000s yes 1000s of people over the years, in an attempt to inoculate them against the onslaught of the truly well meaning mediocrity they will often face from loved ones and friends when looking to step out to realise some of their harboured dreams, goals and aspirations.

    I am very grateful that I get that opportunity, because sometimes a mustard seed of belief and faith can create wonderful things and experiences, and a few more free range humans.

    We all want it, few will step up.

    ta

    rolf
     
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  7. JDP1

    JDP1 Well-Known Member

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    Not really. Sydney/Mel vs Brisbane have too many differences in drivers of the price. In many substantial ways, the markets have a negative correlation between the two (although the size of this negative correlation is decreasing as Brisbane transitions from a regional outpost to a proper city in its on right).
    Some things such as lending conditions and rates are relatively constant across the board and may dampen the Brisbane market a bit, but likely not substantial.
     
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  8. highlighter

    highlighter Well-Known Member

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    Ouch on this week's auction results... 44% for Sydney. I'd probably ignore Melbourne, though, 42% but it seems like very few auctions.
     
  9. Tofubiscuit

    Tofubiscuit Well-Known Member

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  10. kierank

    kierank Well-Known Member

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  11. Dean Collins

    Dean Collins Well-Known Member

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    People who bought in 2017....are still ahead (yes would lose after stamp duty/sales costs but only after they sell).

    My point being is anyone who bought before the last 24 months is doing fine. So less than 10% of the market is now behind.......the rest are still ahead or not looking to sell move anyway....so the point is moot.

    Wake me when we still fall 10% a year for the next 3 years and then i'll be happy to buy your property in 2021.....until then worry about stuff like this is a waste of time and you should go play golf/get a hobby.

    The market will come back.....when it does be ready but until then....enjoy your life.
     
  12. sash

    sash Well-Known Member

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    Nope...people who bought 24-36 months ago in most instances would break even or be at a loss. The peak was around very early 2016 in most markets. Market looks like it might come off 10-20% from peak in most markets....in some markets 30% is possible.

    As for not caring ...some people can't wait for another 10 years to make money. ;)
     
  13. BB5

    BB5 Well-Known Member

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    It's completely different now though. In 1992 most women would stay home when the kids were young. A huge part of the boom since then was a change from one income to dual income households. Unless we are going to have multiple generations paying off a family home or plural marriages I can't see how this can happen again without huge wage growth.

    Not to mention interest rates over this period.
     
  14. kierank

    kierank Well-Known Member

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    You’re kidding. You are not the first poster to write that on PC.

    IMHO, the more things are different, the more they are the same.

    Not my wife. I made here work in our business.

    We had four businesses in our working life (the first BC). My wife worked in all of them.
     
  15. Rex

    Rex Well-Known Member

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    Exactly, these two factors are not repeatable. With mum already working, households don't have another person they can put into the workforce to double their income. Similarly, interest rates can't practically go much lower than they currently are.

    An easing of credit policy is the only thing that will get the big two markets going again, and even then there isn't a heap of room to move without better wages growth. Sydney and Melbourne house prices won't just magically double again in 10 years without the money to drive it, unless we see runaway inflation.
     
  16. TheSackedWiggle

    TheSackedWiggle Well-Known Member

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    Unless you are talking about some other country, many womens in Oz worked even in 1992-99, just that it's was a choice back then not a compulsion like it is now. The difference is the Size of debt. The single most important event leading to rise in RE prices world wide post 911 was mother of all credit easing cycle.

    We are already at the bottom of IR cycle and I believe our economy can't sustain even an additional rise of 4% interest rates before unravelling simply because of the size of our household debts(at least for many).

    Credit ease past is not returning for many many years to come, Today's credit environment is the new normal.

    We are past easy-credit and past two-incomes to boost House prices,
    So unless Oz legalises polygamy and polyandry, we will have to deleverage like rest of the world and then rely on slowsand gradual income rise for some time to come.
     
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  17. SoroSoro

    SoroSoro Well-Known Member

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    I purchased 24 months ago and I'm up ~25% (before stamp and other fees). There were still good deals in 2016 and I'm sure there were in 2017 as well.
     
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  18. SoroSoro

    SoroSoro Well-Known Member

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    I see a lot of attempts at rationalisation on how oh how could prices possibly go higher? Then I look at other cities that make Melbourne look downright affordable. London, San Fran, NYC all come to mind. And if Melbourne looks affordable, it makes Brisbane look like a steal if it continues to grow at the same rate - Brisbane added almost 1M people in 10 years! 1.5M to 2.4M - that's huge.

    I realise it's not apples to apples, but Sydney and Melbourne are world-class cities - people will pay a lot to live in these cities over the coming decades.
     
  19. sash

    sash Well-Known Member

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    You population stats for Brisbane it totally incorrect. Brisbane has about 1.95m people in 2008...it is now about 2.5m. So a growth of about 550k people or 28%.

    Being a world class city does not mean that there are cycles to the growth of these cities.

    You might be up 25% up on your purchase...but that is on paper. A 15% fall could wipe most of it out.
     
  20. SoroSoro

    SoroSoro Well-Known Member

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    Thanks for the correction - I must have misread the population stats.

    Yes, a 15% fall from here would wipe out most of my gain. I was just providing a counter example to your comment.