Will Property Really Plummet?

I'm not talking short term. Short term is definitely uncertain.

Longer term, I ain't worried.

 

Also next stimulus plan is going to be on infrastructure in US, creating jobs

 

we just dont know how long it will last thats problem??
As a developer we are in higher risk environment

not saying everything will go to pot.... but not goid

 

I agree. But we don't need to develop if we feel it's too uncertain. I've put a project on hold. Doesn't hurt me. I'll develop it when times more certain. For those midway into a development, it's more tricky.

But my overall sentiment on real estate hasn't changed. Buy well and.l over long term you should do relatively well.

Covid is not going to change how Australians fundimentally view real estate IMHO.

Market sentiment (and IMHO prices) is largely driven by human emotions. Now it's mostly fear and uncertainty. This will shift one day. And bang, prices will rise. Low interest rates, sense of final euphoria hits the consciousness of masses and booms will be on their way (over time).

 

If you can put project on hold the way to go
Did the same

 

The elephant in the room - no mention on how the huge Govt financial support will be repaid or who is going to pay? Tip, it won't be the unemployed who pay it back.

 

How do I join?

 

Spoke to an Agent on the central coast nsw yesterday. Said market is still strong. Obviously less people looking at houses but those that are by private appointment are actually ready to by. Block of land across the road is for sale and he said he has 5 buyers on it for a great price.

 

Agents are the best spruikers, their income relies on it.

Don't leave me out, I wanna join the secret society club of paying tax too.

 

The same people who always do. The hard working middle class.

 

An extra 400 rentals came onto the Sydney market in the past day.



People are being forced to drop rents or risk vacancies. Here are a couple of examples from Lane Cove.








SQM Research - Property - Weekly Rents - Sydney

 

Houses are not immune from the oversupply either. Examples from Randwick:

 

@albanga

hahaha




Thats what the lower and middle class always tell them self.

Sounds almost like a like a Trade union slogan.
Most of the middle class are actually net receivers of tax once all calls are done

The second article is what was happening under proposed changes where’s the rich would pay even more.






.

 

@Illusivedreams I don’t think perhaps you understand what the comment means when someone says the lower and middle class are the ones that “Pay”.

I’m sure you can work it out though as I’m tired of debating with you.

 

Yep, I've already negotiated a rent reduction with my landlord. I'm on a month to month so happy to revise up or down again in the future to match the market. I would be very surprised if it goes back up in the short term, lots of new stock coming onto the market

 

Empty homes: Rental vacancies tipped to rise as job losses mount - realestate.com.au

 

The analysis on this is quite simple. It doesn't really require an economics degree to unpack! Just look at the factors impacting demand.

In very simple terms:
Massive income hit
Massive jobs hit (it will be the biggest hit to jobs in most of our lifetimes).
Massive population growth hit
Massive domestic economic hit
Massive international trade hit
Massive hit to credit growth
Massive hit to the rental market
...
All at the same time.

Massive is an understatement too. Think of a data metric for each of the above (income, jobs, population, growth, trade & credit). Every single one of those will be near or at the lowest point in multi-generations.

Yes prices will fall. They already have. They will continue to fall.

Yes property will remain in demand. Of course it will (otherwise prices will be zero).

But demand to property has had one massive sledgehammer taken to it. It's been swung multiple times, harder than ever, all at the same time.

This will lead to the fastest material fall in property prices in most Australians lifetime.

Yes it'll recover of course. But that doesn't change the above statement that's about to happen.

There is also a heightened risk of it being much much worse than the above statement too. I.e. the biggest ever fall to property prices on record. I think those type of scenarios are unlikely to be realised given the massive fiscal & monetary support thrown at it (assuming a vaccine is actually found).

 

Not for all

 

What is the impact of a material fall in property prices (for, say, a few years) if your job is ok and there is no need to sell?