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I swear, I did not write this....

Discussion in 'Real Estate' started by 02bsure, 15th Nov, 2008.

  1. 02bsure

    02bsure Well-Known Member

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  2. Chris C

    Chris C Well-Known Member

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    It sums up both sides of the debate nicely.

    Though I would have liked to have seen her though out some figures on just how far she thinks housing prices will fall and by when, just to make the article a little more controversial.
     
  3. Billv

    Billv Getting there

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    You could have written it, but you would have gone too far as usual...;)

    cheers
     
  4. Redwing

    Redwing Well-Known Member

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    Only way is up for real estate, say big developers | NEWS.com.au

    :D



    TWO of Australia's biggest residential developers have called the bottom of the housing market, saying some life should return to the troubled sector next year.

    Billionaire apartment developer Harry Triguboff and the listed Mirvac Group said signs of growth in demand were emerging.

    It runs counter to a report this week from AMP chief economist Shane Oliver, who said Australia's overvalued house prices could fall 10-15 per cent next year.

    Mr Triguboff, founder and owner of Meriton, the country's biggest apartment builder, completed and sold 1000 apartments this year, well down on the 3000 a year built during the boom in 2002, The Weekend Australian reports.
    Next year, he hopes to build 1500.

    While Mr Triguboff said he "always met the market" when conditions cooled, he expected Meriton's prices to rise 10per cent next year underpinned by the government stimulus, rising rents and the lack of supply.
     
  5. Billv

    Billv Getting there

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    Redwing

    Thanks for the link.
    Ofcourse our mate 02bsure will be dissapointed but what can we do?
    Hopefully one day he will agree that the situation in Australia is indeed different...

    cheers
     
  6. Chris C

    Chris C Well-Known Member

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    Australia may well be in a fortuitous position at the moment, but nothing lasts for ever and the further this bubble expands the further it has to fall when things do sour.

    I don't agree with 02bsure that the ass is going to fall out of the property market, but I dearly hope that we don't see rampant housing price growth like we have seen in the past based purely off lower interest rates and increases in the FHOG.
     
  7. Billv

    Billv Getting there

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    Don't worry, we won't.
    Property is not the flavour of the month anymore and the speculators can see that there is no much money to be made so they'll have to find something else to speculate on
     
  8. Jacque

    Jacque Team InvestEd

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    Ah the beauty of the mass media- one can find an article somewhere to support any point of view. We all do it, to either prop up our own opinion (however misguided!) or to show others that we're not alone in our way of thinking.

    The trouble is when things are simply bubbling along, it doesn't sell newspapers :rolleyes: hence the need for sensationalism and catchy headlines. In the space of one day, I can read totally contradictory comments from all manner of "experts" who claim to be able to foretell the future when it comes to everything from the price of petrol to Darling Point mansions.

    At least it keeps the discussions rolling along between us all!

    2bsure, don't be shy... we all know you're really an undercover journalist/writer, spreading your endless gloom and planning your next hit book, "How Sydney houses ended up selling for $1" :D
     
  9. 02bsure

    02bsure Well-Known Member

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    ok then, just for the hell of it ....

    Bloomberg.com: Exclusive

    Note - Holland (especially Amsterdam) was the last real estate bastion of strength in Europe , its now broken.

    Still think oz is differnet, or are you guys getting a little twitchy?
     
    Last edited by a moderator: 25th Nov, 2008
  10. Jacque

    Jacque Team InvestEd

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  11. Chris C

    Chris C Well-Known Member

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    I think it is different, though not immune to falls in propety prices, just the depth at which they will fall. I know up hear in QLD we already saw prices drop 3.3% in the third quarter, and I'm not expecting news to get any better in the fourth quarter or in 2009. Though I don't think we'll see prices fall by more than 10% from their highs, even with unemployment to rise over the coming months. There is still significant pressure holding prices up (at least at the <$750,000 part of the housing market).

    Ironically the scariest thing playing in world econmics is barely getting a mention, the impending fallout of the $US weakening!

    I mean the world was scared that the US would stop buying some of our exports when they went into recession; well wait to see what happens when the US can't afford to buy any of our imports because their dollar is worth half of what it is today!

    Apparently the US has already racked up another $2 trillion in debt in this last year alone in a bid to try and save their faltering economy, but this time around it is looking like China (the biggest buyer of US reserves) is in the process of off loading US treasuries for gold, so who is going to foot the bill?

    My big fear is that with the world governments simultaneously attempting to stimulate their exconomies through tax cuts and fiscal expenditures there will be few who are willing to pony up the dollars to buy US treasuries when it is starting to look more and more like the writing is on the wall for the long standing superpower of the world.

    If the world thought the US going into recession was bad, I'd love to see how the world reacts when it goes bankrupt.

    Whether or not this will effect world/Australian housing prices I'm unsure, you'd have to think it would. Though it is hard to anticipate exactly when this US bankruptcy issue is going to start playing out, but you'd have to say that if China, Japan or the UK don't continue their purchase of US debt in the coming months their might be a few more mass media reportors turning their heads to cover this story.
     
  12. 02bsure

    02bsure Well-Known Member

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  13. Chris C

    Chris C Well-Known Member

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    I can appreciate that many major institutions, ie central banks, governments etc have a vested interest in not panicking the public for fear of creating a self fulfilling prophecy, but recently I have been wondering do you think these same institutions are influencing the mass media to limit their doom and gloom forecasts?

    I mean I just can't help but feel that most articles you read in the mass media really only touch the surface on how far this rabbit hole goes, and I'm starting to wonder if they are just playing the puppet...
     
  14. 02bsure

    02bsure Well-Known Member

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    Well what is certain is that enormous advertising revenues have been/are being earned from the real estate business. This being the case the media business would be cutting the nose of their collective face if they were to write damning articles about the state of the real estate market.

    I think everyone accepts that this is the current situation in much the same way Standard and Poors, Moodys etc were only too happy to slap AAA ratings on clearly dubious debt securitiies.

    Basically, when the hot money is flowing no one is willing to stop it.

    But when an industry finally implodes everything turns on a dime. Suddenly the media becomes the public watch dog and takes the position of defender of Joe Public.

    Same thing will occur in the oz real estate scene. When its becomes clear that add revs from the real estate crowd are not coming back journalists will turn on them.

    Right now the only people taking a contrarian view point on real estate in oz are academics. This stands to reason because they don't fear losing any income or a job for that matter.
     
  15. Chris C

    Chris C Well-Known Member

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    Are you referring to the current AAA rating of US treasuries...

    :rolleyes:
     
  16. 02bsure

    02bsure Well-Known Member

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    I was actually referring to CDO's etc.

    As for US treasuries I completely agree with you. The US will default its simply a question of time.

    As this time draws nearer I'm sure we'll see a significant increases in yields ....and thus mortgage rates which track 10 year bonds in the US.

    I wonder if a new global gold based trading currency will emerge before this event occurs. Its merely a pet thought of mine.
     
  17. Chris C

    Chris C Well-Known Member

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    :p

    I knew you were referring to the original credit ratings issues that started much of this mess, I just taking the piss out of how the world never learns, as I see US bonds as the world's new junk bonds in the guise of being investment grade...

    The one thing I keep debating in my own head is, just how much time until it happens?

    Part of me wants to say that if this US recession is deep and extended the government will be forced to continue to spend/bailout in a bid to stimulate the economy and as a result will incur more debt and increase the budget deficits to the point where the US national debt will have reached somewhere between 75% - 85% of GDP by the end of 2009. At this point you'd have to think with the US more than likely having a bleak growth outlook with growing expenses, that it really won't take the rest of the world will be able to do the sums...

    Then another part of me has to recognise that the US has been playing this game for some years now without major reprocustions and I can't help but feel that the world may very well be happy to continue down this path until it really can't be ignored anymore, which may take at least a decade. Not to mention there are a lot of countries out there that are dependant on the US for their exports and as such have a vested interest in not seeing the US collapse and may well be willing to support them until we are all sufficiently satisfied that Obama isn't the messiah and can't make debt disappear just because he is black.

    :p

    What's everyone else think?

    Either way it is looking more and more like the UK will be showing the world the way when it comes to major currency/economy collapse, with their debt to GDP ratio now reaching 80% and only looking up for the next year or two:

    Gordon Brown Bankrupts Britain to Win Next Election Mid 2009 :: The Market Oracle :: Financial Markets Analysis & Forecasting Free Website

    This definitely won't help stimulate a struggling economy, which won't bode well for the US considering I think their game plan is to grow/inflate their way out of debt like they have in the past...

    :rolleyes:

    I tend to lean towards "no" on that thought. I think necessity is the mother of invention, and until the USD folds their won't be a true movement to a gold standard. I also think there will more than likely be an intermediate movement to Euros once the USD starts to slip before the world looks for a longer term solution.
     
  18. MattR

    MattR Well-Known Member

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    Except when he's overseas, then we're ......Rudderless.
     
  19. Tropo

    Tropo Well-Known Member

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    “...........and may well be willing to support them until we are all sufficiently satisfied that Obama isn't the messiah and can't make debt disappear just because he is black.”

    Don’t you believe in.....‘Black Magic’? :confused::p
     
  20. Chris C

    Chris C Well-Known Member

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    I believe good intentions don't automatically translate into good results, and whilst I believe that Obama probably has the best intentions that any US president has had in quite some time, it doesn't change the fact he has inherited a terminally ill economy. The best he can do now is offer comfort in its final days.

    My only hope is that the US doesn't accept its fate and decide that if it is going to go out, it's going out doing what it loves - asserting its military prowess.

    :eek: