Sydney - the coming correction 2018-2022

Do we have an actual number? I am trying to see the proportion of home owners on IO loan going into distress when rate rises.

 

I reckon it will take of...nothing like Sydney....but by 2022...we should see at least 30-50% growth.

So stuff at 400k...should be worth about 520-600k.

Obviously..some areas will do better and worse.

 

Most people will sell before then...if they can trade out and can break even...so only a small portion of sellers....about 1%

 

Then I doubt we would have a "boom", just soft landing.

 

Well...this is how it works....during the 2012-2016/2017 boom in Sydney people would have leveraged to the hilt to get in. Lets say someone bought a place for 850k I/O at 4% for 5 years in 2015..and it topped out at 1.5m...then ....they still have say a 750k loan. Their repayment when they bought it would have been 30k....now it would be 37.5k.....if it goes P/I they would be paying pretty close to 50k...so an increase of 20k.

In 2020 they decide to sell...because they can't afford it...the price of the house due to the number of listings is likely to be 1.25...so a drop of 250k....but they still made a profit of 400k...but less than 650k had they sold in late 2016!

This what will happen in most circumstances. The 1% will have bought late...have not equity and walk away with a loss (assuming bank lets them) or walk out with zero equity. Welcome to the property cycle.

 

Anyone with a lot of cash will always be in good position, provided you actively looks for bargain in the market, and using your large amount of cash as a weapon.

 

Yep...but no hurry in Sydney...and Melbourne will go down that route shortly.

 

but no one have crystal ball though, if a HOSUE within 5KM ring that is 15% cheaper, may worth a buy.

 

i likey like 15-20% discount in Sidney, i get warm and fuzzy all inside.. hard to be patient and wait for more

 

Some have already have come off that much.....for example parts of North Shore $3m plus...now mid 2s...

 

If there is a jetty with it, may worth the mid 2s

 

Yeah...if it was in Mandurah it would come with the works...in Sydney town....you might get an okay house in the lower Northshore on a decent block of land (550-700sqm).

Hey in Mandurah you would have enough money to buy a cruiser even...

 

Agree, this happened in my street, however some overpaid by 10% while buying on top of cycle....
The disparity here is also wider, msq of land, whether older or newer, nicer aspect, water views, with pool, and jetty still command millions...!

 

With Jetty try at least 10 Million, if it will be worth $3million I would buy it!

 

Winners and losers in the downsizer deluge

this might make things worse?

 

Sydney home prices just suffered the largest decline over a financial year on record -- here's where they fell the fastest

not the best source

 

Deutche bank say worst of Sydney correction already passed:

DEUTSCHE BANK CALLS IT: The worst of Sydney's housing market downturn is probably over

Interesting chart:

 

Many correction examples are around tge above mentioned figures. Not many under $1M at the moment I guess waiting is tge key for some time....

 

Douche Bank are talking their book ffs.

If you think this is over, ....good luck.....really I hope you are right,..... just seriously doubt it.