When will Sydney property market going to crash ?

Banks have made record amounts of profit with low rates as people borrow more. Also there is currently more banks than ever to choose from...

 

Sydney auction clearance rate is crazy 85% ...

I guess people this time is really think that they're wealthy due to easy access to money at the bank.

But yes we'll see next two years.

 

@Tekoz have you ever heard of the saying "champagne tastes with a lemonade budget"??

900k won't go far within 20km of Sydney CBD. You will either have to make a compromise on location (further out, or less desirable suburb) or dwelling type (smaller unit).

Or there is option #3 - keep on saving hard like the rest of us Sydneysiders who are yet to purchase a PPOR here and try not to get too discouraged with what you see going on around you...

 

Nah just keep waiting hoping for that crash you deserve lol

 

900k won't get you much within 30km from Sydney CBD.

 

Sydney won't crash, and even if it does, wait it out and it will kick arse just like what NYC and London did after the gfc..might take a while, but they will come out stronger.

 

Yes, that's what surprised me today, even an old town house in 20 km outside Sydney CBD is sold at auction for almost $1m.

this is truly overprice compares to QLD. Considering it is still in the same country and of course continent.

 

I should have a standard cut and paste post for these comments ......

The figures they quote are 12 month moving averages , so when the GFC hit for 2-3 months afterwards , finance was hard if not impossible to get so the main group who were buying were ones with cash or equity in LOC's which is where we were
.
So we made an offer in Mosman that was 40 % under an asking price that would have been quite reasonable Pre GFC and ended up paying 30 % below the asking price . Not many sales happened and a few months later people realised the sky wasn't falling in and the market picked up , but for 2-3 months there were some seriously good deals happening .

The reality is , once you apply a 12 month moving average , it averages out the reality of what happened in that fairly short window when bargains happened .

Cliff

 

Hm.. the reason I created this forum post is that because according to this reputable news source 6 global cities that could be in housing bubble and big bank analysis, Sydney is on the 4th place of the most expensive place to buy property.

 

A crash or deflating market will only happen if property owners stop being able to afford their property and are forced to sell. This happens because:
1. Local economy goes down the toilet, causing major job losses (e.g. Gladstone, Moranbah, Karratha, Port Hedland)
2. Interest rates go up more than owners allow for (I suspect that most don't allow for +2% increases above current)
3. Govt intervention.

In the short term I can't see any of this happening, unless China has been hiding something really ugly and causes another GFC. I'd say it's more likely that prices will stagnate when people reach the end of their affordability rope.

 

We were 3rd last year so that's an improvement

Not much info at all about why they think it's overvalued-

30% in 4 years... Have they never seen a Syd property cycle peak before?!

 

Spot on . the rate this boom has moved in Sydney is on the slow compared with previous ones . in the late 80's prices in parts of Sydney doubled in around a year ....

hm.. The reason I post hear is to share my observations . Many observers consistently get the sydney market wrong . The economist has been telling us Sydney prices have been overpriced for as long as I've been involved in property investing .

Most years a new scenario is floated as to why the economy and property prices are going to go into free fall and the vast majority ( if not all of them ) get it wrong . THey got to write something that creates controversy in order to create publicity for their brand

Excuse us for not bowing and praising before the altar of the UBS Global real estate Bubble index .

Cliff

 

There is a difference this time....interest rates have never, ever been this low in history.

We are in un-chartered territory in this regard.

 

Actually no , we're always in uncharted territory because the world is constantly changing .....

IT'S DIFFERENT THIS TIME ..... because of ... . Is a very frequently heard term on the forum .

The " because of " is different each time , but it's always there .

Logically one would think the ease of transfer of knowledge who create an efficient market where valuations change smoothly in line with their " actual value " ( what ever that is ... ) , but the reality is that the underlying driver behind changes in value is one thing and that is human emotion ... we are an illogical species that react illogically and emotionally in most things we do and that will never change .

Hence we will continue to have booms and busts which will defy logic explanation , but if you accept that and ignore " logical predictions by financial experts and economists " you can do well .

As long as Australians have their fixation with owning their own homes and wanting to buy investment properties ( which they continue to aspire to ) the property market will continue upwards in a boom bust cycle .

Cliff

 

What I'm getting at, is there will be a bust, and it will likely be of a bigger scale than in the past. This is because of the aforementioned RECORD LOW rates and therefore a higher-than-usual peak in the ability of pundits to borrow.

No doubt, aussies will continue to be fixated with property, however it will need to be at much lower prices when the day of higher interest rates eventually arrives. If the day doesn't arrive? Well, rates will hit 0% and the scope for asset price growth will be constrained due to low inflation and no further scope to drop rates. See Japan.

In either scenario, the easy gains are behind us, in my opinion.

 

I've been hearing that opinion expressed for the last 20 years, especially after booms, which will come and go as they always have done, in my opinion.

 

Sydney, Melbourne housing markets cooling off? Not so fast
Sydney, Melbourne housing markets cooling off? Not so fast

Finally a journalist with a brain.

 

I hear you, I'm the first to admit that I've been wrong about this for quite a while now.

As prices continue to increase as higher and higher multiples of household income, and debt as a % of GDP - the 'easy gains' statement has to become correct at some point! Prices are increasing at an unsustainable trajectory.

 

You beat me

Cliff

 

You've been hearing it for 20 years for good reason!

Is your assertion that the below trend will continue indefinitely?