The IO property cliff disaster? Fact or fiction

Don't have time to read the whole 6 pages long. Sorry I have better things to do right now.
Maybe when I am on holiday or a break - if I remember. I only have a spare few minutes to click on the recent post viewing. What's currently the hot topic conversation.

 

OK let me consolidate 7 pages.

Everyone agrees a P&I cliff exists.

Everyone agrees that the cliff only effects a very tiny portion of the market to the point of forced selling.

Everyone agrees the cliff hasn't and will continue not to have an impact on the wider property market.

 

agree with all bar last paragraph

there is always a contrarian

 

Good point!
I have warned others in the past about making closed statements when it comes to the property market and lending and here I am doing it.

The last paragraph should include **

 

Personally is was a steeper gradient .

Like all things in life with barriers you can

• Deny it's there
• Accept it's there , see how it affects and change your action.

For me this is perfect lesson on why you can't plan too far ahead .

You never know when things will change with your self or the environment around you.

If you set your mind on how you will do things , you won't see those great opportunities when they occur , because you've planned everything ahead

Cliff

 

A dimple?

 

Me guilty too

 

OK....business as usual then.....back to zzzzz..... ...how else would fill their days...

 

You completely cherry picked what I said. Rate cuts ON THEIR OWN...had zero impact.

Rate cuts WITH the cut in assessment rates absolutely made things easier - for about a month, after which HEMS took a leaping hike and pretty much wiped out all the benefit.

So my point is you're wrong about rate cuts making borrowing easier.

It's getting more and more difficult with rental income getting shaded more heavily, HEMS going up consistently - and not by a few bucks here and there...it's significant.

The election result had far more to do with any recovery in SYD/MELB than interest rates and assessment rates dropping.

 

This I agree with.

Correspondingly, Libs in power for longer and forecasts for the cash rate dropping will keep the party going in Syd and Mel. All we need is for ScoMo to keep a low profile.

 

Yep 100% agreed. The HEM is getting more and more stringent.

 

Housing stress: More than 80,000 Aussies to default on their mortgage in 2020

very surprised to see this article... Thought with the rates where they are, this was the issue of the bygone era.. Any thoughts?

 

Thats forecasted defaults. New estates with fhbs are usually the highest concentration of high lvr debt. How accurate have these forecasts been historically?

 

That article is a bit pointless , because it doesn't mention what the normal rate of defaulting is so you can't draw any useful conclusion . just scare mongering .

Comparing apples with ....

Cliff

 

That article was in 2019. All sorts of numbers and doom and gloom quoted. Little did they know the boom of all recoveries was just around the corner . Like I've always believed, 98% of all the fancy graphs and scaremongering numbers put out isn't worth 2 cents.

I love this line, "The big global credit rating agency Moody's, which devotes a considerable amount of time and energy to studying the risks building up in the likes of the big four banks, earlier this month forecast house prices had another 10 per cent to fall nationally"

https://www.abc.net.au/news/2019-05...ise-as-house-prices-continue-to-fall/11061780

 

Almost 1 million Aussies set to default on their home loans: Digital Finance Analytics

Back another year.

 

I thought this topic was put to bed

ok, now we are in for another round...

 

Brilliant!

So down to 80k from 1M in 1 year.. I call this 92% improvement!

Thanks for the article. Adds to the perspective!

 

You can probably find these articles (and bullish ones) for every month.

none of them would have helped you navigate the fall in 2017 and subsequent miniboom in 2019.

so whats the point of the articles? For buyers and sellers, not much.