NSW Sydney prices still falling...

Discussion in 'Where to Buy' started by Oliver Shane, 4th Jun, 2019.

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  1. Erica

    Erica Well-Known Member

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  2. Timb89

    Timb89 Well-Known Member

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    From the article:

    But let it be known Sydney has bottomed out at an overvalued point. The data suggests the Sydney housing market remains 21% overvalued despite the two year correction. For reference, the average overvaluation (since 1986) in Sydney is 19% with a low point of 5.9% ‘undervalued’ in June 1987 and a high point of 55.5% overvalued in December 2003. The most recent overvalued point was 51.6% in the June Quarter 2017. The most recent undervalued point was 1.6% undervalued in September 2012.

    It depends if in this global economic climate you think it's going to return to overvalued or fairly valued.

    If the overvalue/undervalue cycle is to be believed, we still have some falls to see.
     
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  3. Erica

    Erica Well-Known Member

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    In the graph accompanying that article, you might like to note that, in the past 33 years Sydney has only shown "fair value" (house price index against GDP) in 1986-1988, in 2009 and in 2011-2012.

    If you are waiting for a return to "fairly valued" before you make an entry into the Sydney property market you might be waiting for a very long time.
     
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  4. Timb89

    Timb89 Well-Known Member

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    It depends how sustainable you think the distance between the GDP and house price index are, according to that graph, reset seems inevitable. What will keep that at the current point given a global/domestic shock (or once FOMO runs out) to the system?
     
  5. Oliver Shane

    Oliver Shane Well-Known Member

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    Ahahahah one of the biggest one eyed property bulls there is...
    You would live a fraught and stressful life listening to ‘experts’ constantly
     
  6. Oliver Shane

    Oliver Shane Well-Known Member

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    Or not.
     
  7. Erica

    Erica Well-Known Member

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    Touché...

    I'm rummaging around for my crystal ball as I type...
     
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  8. Sackie

    Sackie Well-Known Member

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    I don't know a single wealthy hardcore economist.


    I take everything they say with a pinch of salt. Actually a pinch is probably too generous.
     
    Last edited: 31st Aug, 2019
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  9. Bunbury

    Bunbury Well-Known Member

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    Best to leave them out of the recipe altogether methinks
     
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  10. JQ88

    JQ88 Well-Known Member

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    Shane Oliver? Or maybe Oliver Shane?
    (Insert smiley face here)
     
  11. Mr Burns

    Mr Burns Well-Known Member

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    Not sure if this was posted earlier.

    "In Sydney, home values have surged an incredible 1.3 per cent in August (the biggest jump since March 2017), according to CoreLogic."

    Is the house price boom back?

    There's one more day left in the month, could it go up further :D
     
  12. sash

    sash Well-Known Member

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    You are kidding right...I see a lot of people jump into Sydney now...I can't see value.

    Here are the facts:

    1. Rental returns are atrocious....between 2-3.5% in a lot of suburbs.

    2. I see BAs now focus people from Logan to suburbs in Western Sydney and spin more diatribe...including dual occupancies. No one is looking at trends in rents in Sydney.

    3. Very few people are considering the supply coming into Sydney. Even Brisbane has corrected their over supply of units...Sydney has not...and there is pipeline for another 18 months.

    4. No offence but most BAs are amateurs. They have revenue based model and doubt they will but well in the current market.

    I personally see this is as a dead cat bounce.....time will tell. There are better market in NSW...Sydney is still overvalued and it will take time for it be corrected. Even if prices rise...the downside at the other end is going to be even more severe.

    The people who are Buyers Agents are not very experienced....they have revenue model. They talk about long term. I feel you make your money when you buy....

    What can I say...if you want investing to be social then listen to some of pied pipers...but don't expect to be retired in 10 or even 25 years. I was financially free within 10 years...but exited after 20 years...I pretty much replaced my income. This is not done by relying on BAs...I did my research and networked. But also went against the heard (House and Land Packages instead of existing houses..if I elaborated it would require whole another thread)......
     
  13. Harris

    Harris Well-Known Member

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    I enjoy reading your posts Sash & appreciate your views to balance out the likes of mine (and other bulls here) but I disagree with the broad based assumptions on "BA are not very experienced" and "you make money when you buy" that you are stating as 'facts'. They cannot be farther from being 'facts'.

    I have never used BA but a good BA that can negotiate a good deal in a private sale (even for some auctions) is worth his/her fees times a few, for the time poor OO/ PI. Not everyone wants CF+ prop or have time to scour the markets, or are new to the country and/ or have significant incomes but get overwhelmed by the amount of data to make a move or unsure of how to negotiate with the agents. Perhaps some of them want to assess the future sub development options but simply don't know / understand the council rules and can't undertake detailed feasibility even where they have have accumulated significant knowledge through these forums and their research. Paying a BA say $10k (for a million dollar buy) or 1% of the transaction to me is a great investment.

    Secondly, whilst I appreciate that one 'can' make money when buying a property, I deem this strict-rule/ generalisation as the only way to gain incremental wealth as a bit of nonsense (with a lot of respect to your views). I and many other very successful PIs I know have made incredible gains whilst letting 'time' and 'compounding' create the incremental wealth over time. It is do-able but in my opinion 99% of buyers wouldn't know how to put this into practice. A 10% growth in a cycle (most cycles would deliver far above 30% over a course of 2-3 years) takes care of 'making money'.
     
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  14. God_of_money

    God_of_money Well-Known Member

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    Lots of PC investors (and some BA's) are obsessed with CF+ve properties. Keyboard warriors who cant afford to invest in Sydney are talking down about investing in sydney/melb.
     
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  15. sash

    sash Well-Known Member

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    Harris.....let me clarify....I did not say categorically not to use a buyers agents.

    What I am saying is that 90% have more concentrating on maximizing revenue for themselves.

    There are good ones out there...at reasonable prices. But you need to find shift through them.

    Lots multiples in places like Logan and the numbers did not work. I am getting our lower socio areas as even if they have gone up...the amount of maintenance and tenant issues make the investment less attractive.

    All I am saying there is not short cuts to wealth ...you need to be hands ...sure use a good buyers agent initially but you need to learn the ropes...

     
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  16. mickyyyy

    mickyyyy Well-Known Member

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    I bumped into Louie on Thursday and had a chat and he firmly believes this is not a dead cat bounce. I believe Sydney median has the potential to grow up to 10% the next 24 months only in specific areas that will contribute to the median price increase. Lending is not that much easier and not getting a lot more money than before but its enough to get PPR buyers into the market. Only very few reasons to buy now in Sydney and its mainly around PPOR purchase and if investment you got an absolute steal and not purchasing another for a long time.
     
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  17. Dean Collins

    Dean Collins Well-Known Member

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    Following up from my post the other day......
    .... little bit of post earnings action after the close of $WPG tonight.

    My cost price is $3.51 :)

     
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  18. berten

    berten Well-Known Member

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    I'd agree, assuming the economy holds, another +10% on top of the recent 5% seems reasonable. That would bring us about in line with previous peak, over in some areas, below in others. I reckon prices are liable to overshoot then cap out or slow down quite a bit around there though unless we see decent wage growth or big wave of Chinese capital.


    I'm in bayside melb and the market is running hot here compared to when I bought back at election wknd.

    Anyone in Syd that can confirm conditions there? I heard mostly booming but west still falling?
     
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  19. Mr Burns

    Mr Burns Well-Known Member

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    From my experience, south west Sydney has low stock for sale. Prices are back at or close to 2017 peaks in some suburbs.
     
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