This Housing Downturn is Over 2020

Mass unemployment just started. Global IT company i work for has all contractors gone this week & our hours also reduced. One medium size Australian company i know has 20 staff sacked (not hold) from Sydney office & over 70 staff nationally just this week only. Same company, more sacking is coming next week especially sales executives. Friends running small businesses (one man to 20-30 employees) losing most of them. GFC2.0

 

Lawyers, drag queens and casuals — thousands of Australians were left unemployed this week
Another 17,800 Australian retail and travel workers lost their jobs this morning
Myer to close doors, stand down thousands of jobs

 

My aunty has been stood down at Qantas.

Guess it was not too unexpected given the business though.

 

Over 20% of housing stock has changed hands in the last 4yrs. Not all of this will have debt attached but still a significant amount. Interesting to see how this pans out, very difficult to predict, although safe to say it's going to make a dent! 3months ago I wasn't happy with my cash ratio but saw too much risk in the markets. As circumstances have turned out there may be some opportunities come up. Still very cognisant of holding cash when they have the printing presses running...not keen on getting left behind!

https://www.rba.gov.au/publications/bulletin/2010/jun/1.html
Fact file: 9 million homes with 2.6 occupants - this is the Australian housing market - ABC News

 

My biggest concern with what is happening now is within what you mention. Interest rates are not being used as a measure of risk. Governments propping up lending by artificially holding down rates is going to be dangerous and cause more systemic issues in the long run, I guess this is where due diligence and consideration by lenders come in. Let’s hope they are not overly pressured to give out loans - otherwise you may as well make them government owned.
Banks have not traditionally been sophisticated enough, had enough data or perhaps used the data they have to apply granular risk based pricing to their retail book. It’s also perhaps a cost benefit thing but in the future with better data analytics I don’t see why they shouldn’t?

 

GFC 2.0 is an understatement.

This time around, there is no Mining Boom or Property Boom to save Australia.

The 21st Century Great Australian Depression is a more fitting description.

 

Low rates will help I guess , but in the end - cash flow is KING , yet again .

 

Theres government stimulus to fix it.

 

Better change the heading to 'This Housing Downturn is Over 2021..or 2022??'





{Note from mods - this thread continues here: This Housing Downturn is Over 2021}