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House prices to keep falling for years

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Great annoucement from Rudd today (bank deposits being guaranteed).

It should see even more specuvestors rushing for the sanctity of a 8%+ term deposit
 
"Last week's interest rate cuts spurred her and her husband, a steel fixer in the construction industry, to raise their buying price from $300,000 to $335,000. Part way through the auction, they decided to bid higher still. "

Up to 375k! How prudent of them

The time when you could grossly overpay and squeeze by are over

Its always been survival of the fittest ... these poor souls are and will increasingly be a dying breed.
 
Pommiegranite said:
Great annoucement from Rudd today (bank deposits being guaranteed).

It should see even more specuvestors rushing for the sanctity of a 8%+ term deposit
Click to expand...

hello,

that would be great pommie, and let the wealthy hold onto the genuine real assets with real returns,

while the "traders" bang the CBA money box on a CFD, future or spi move

oh the nasty landlord put the rent up Again,

oh how grand things are as debt is getting cheaper

thankyou
robots
 
pepperoni said:
Sure will.

In fact they will probably borrow at 9% and invest at 8% ... ya see they pay less tax that way
Click to expand...


That's that 'negurtiv gearin' thing I've heard about. Apparently, it's all the rage. The more money you lose, the more you make. Amazing!!
 
Pommiegranite said:
That's that 'negurtiv gearin' thing I've heard about. Apparently, it's all the rage. The more money you lose, the more you make. Amazing!!
Click to expand...

Ha ha

Cash really is king now ... nobody gteeing house values are they

The saying "safe as houses" now means "safe, but subject to price falls and not as safe as govt gteed cash!"

So really safe is now "safe as cash".
 
hello,

oh yeah man, and nothing is being built right as supported by all the stats (care to re-post that data if you like)

thankyou
robots
 
robots said:
hello,

oh yeah man, and nothing is being built right as supported by all the stats (care to re-post that data if you like)

thankyou
robots
Click to expand...

Because there are no margins in it.

Land prices are at a disequilibrium with what people can actually afford to, and are willing to pay.
 
robots said:
oh how grand things are as debt is getting cheaper
Click to expand...

How grand you borrowers are gteeing our profits with your toil.

And good old k rudd himself in gteeing us lenders will get paid. Expect a visit from the ALP if you fall behind in your payments,

Now get back to work and bring us money for another few decades ... we are getting ready to retire.
 
pepperoni said:
Cash really is king now ... nobody gteeing house values are they
Click to expand...

Actually in Sweden, the land where you can insure yourself against just about anything! You can take out house price depreciation insurance. What a farce that is going to be in reality. Still, I'm sure the heads of these smoke and mirror companies got their bonuses and exercised their options while the going was good...so what the fig do they care.
 

Good idea ... I might introduce this insurance for aussies.

This years premium - 10% of market value! It would be mad to provide cover for any less.
 
Lowest clearance rates this weekend...as unemployment rises we will start seeing defaults as people are squeezed out. I think some folks are gonna be dissappointed in a few months time.....and really pissed in about a year..I hope it goes the other way but I think most people are catching on to whats ahead.......no one wants to believe it.....you don't have to.......but at some point in the future you won't have any choice....
 
Ch7 to night Kochie tells us they will job loss 300-500 K House, prices to go down no recession,
 
I like the references to immigration....if it becomes clear that unemployment is rising due to a global slow down, I think immigrants may reconsider there options....houses are cheaper in the US with similar job prospects....and the government may reduce the number of immigrants to assist those the jobless alrady here....

What about inflation...I would think that the pumping of countless billions would cause prices to rise but this capital is only replacing capital that was vapourised...same prices just more debt owned by citizens??? Any thoughts??
 
The reason the gov't are rushing to guarantee depositors funds is not for the borrower themselves. In real bank institutions in Australia, your money as a depositer is effectively guaranteed by the RBA anyway.

The real reason they want to guarantee deposits is due to our fractional reserve banking system.For every one dollar on deposit a bank can lend out multiples of that money. NOw think of the reverse, for every dollar on deposit that is removed from the bank it means that the multiple amount of money based on that dollar has to be retrieved or covered in another way.

So if tomorrow enough depositors with SUNcorp went to the bank and dmanded back their money on deposit, it means that whatever money they have to give to the depositors in return it means that they have to somehow recover/cover the number of multiples that they lent out against those deposits.

I tell you something most people don't know, when you go to the bank and take out a mortgage say for 200 grand, you actually as part of the contract sign over power of attorney that allows them to create a promisory note for the 200 grand. A promissory note is CASH. So that 200 grand promissory note now also becomes a deposit and guess what, they can then lend out multiples of that money.

Why do you think that 5% mortgage/loan failure rates cause banks to fall over.

That is why their was talk of SUNCORP falling over.

Loans are so highly leveredged that it does not take to many in the scheme of things to fall over to cause a financial instituion to fall over.

We have just gone through a time when we effectively had full employment of about 4%, so now imagine if we go back to say 8%, well a substantial number of those will result in the loss of homes due to failure and inability to repay the home loan.

Just go back over history and see what has happened before, if the average loss of value is say 25% in a property drop then without doubt we can expect the same again.

I am like everyone else, nobody realy wants to believe tehy will llose on the deal, but hisotry says if you get in at the wrong time then you lose big time.
 
Things are not looking good for property, there will be alot of people out there that will end up owing more on there house than what its worth.

Immigration will drop and temp workers will be sent home packing whilst trying to save Aussie jobs.

Investors will be ruing the ammount of negative gearing they have acheived on their investments as all prices drop leaving them down bigtime.

To be fair its about time first home buyers got a chance in the housing market and the next 2 years could be their opportunity.
 
Just a little reminder for those that compare Australia's high cost of property relative to the world market:

House prices have already effectively fallen 30% throughout the Australian market relative to the American market in the past month and 20% against the Euro market in the same period.
 
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