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Now's the time to buy a house: NSW Govt

Discussion in 'Real Estate' started by Simon Hampel, 8th Mar, 2009.

  1. Simon Hampel

    Simon Hampel Co-founder Staff Member

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    Now's the time to buy a house: NSW Govt - ABC News (Australian Broadcasting Corporation)

     
  2. 02bsure

    02bsure Well-Known Member

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    So if I run out and buy a house today based on that advice, can I sue the Government if I then lose money on it?

    Things are truly out of order when your Government makes reckless statements such as this.

    The sooner the world of real estate comes under the same legal rules of scrutiny as other financial advisors there will be no more of these horrendus ´buy now or be priced out forever´ style of statements.


    Australian property prices dropped 8% in 2008, in other words a $500K property lost 40K and 2009 is shaping up to be worse still. How on earth do these wingnuts in the State Government come to the conclusion its time to buy?
    Who wants to pay 30yrs worth of interest on negatrive equity?
    Surely they´re not stupid enough to simply be leaping to that conclusion based on a lower interest rate for ´this week´. How about the interest rate in 2yrs from now and the likely continuing price drops? Oh, I forgot, there will likely be an election before then and thats about all that matters to these self serving half wits.
     
    Last edited by a moderator: 8th Mar, 2009
  3. Billv

    Billv Getting there

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    02

    Has the median price dropped by 8%?
    I haven't noticed, where did you get this information from?

    Perhaps the median price will fall this year because many lower priced properties are selling but this doesn't mean that actual property prices are falling, it simply means that many properties of a particular price range are selling.

    Where I am buying prices are going up.
    I am looking to buy my next IP and unfortunately there is too much competition.
    When 1 property sells, the next 1 lists at a higher price...:eek:
     
  4. 02bsure

    02bsure Well-Known Member

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    Bill, I think we´ve already addressed the reasons that only market showing any life is the under 500k market (ie FHOG and investors flocking to the supposed bastion of eternal strength).

    This will evaporate and go into reverse by the end of this year.

    report of price drops ....

    2008 in review: the downturn accelerated at year-end
     
  5. Billv

    Billv Getting there

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    02
    I am sorry but your source is not reliable.

    It first states that Aust & NZ fell by 7 and 8% respectively and then if I click on Australia in the next article it says that prices have gone up by 2.8% which is more like what hapenned.

    Anyway, I am not fussed one way or another, but I am annoyed seeing the sub $500K market increasing so fast.
     
  6. Chris C

    Chris C Well-Known Member

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    What gets my blood boiling is that they specifically target first home buyers aka the young. I don't understand why the government should encourage the young to jump into a falling market to cop the losses from a collapsing bubble formed by another generation.

    The government should stop manipulating the market period. The fact the FHOG was introduced to begin with was a politic stunt that is now a long standing plague on the real estate market and the Australian tax payer.


    Don't worry it's only temporary, and can only last as long as the government props that sector of the RE industry up.
     
  7. davo6253

    davo6253 Well-Known Member

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    To be honest as a 'young person' and seeing the sheer amount of 'positive spin' being put out by RE agents (expected), journalists (also expected) but also official sources such as governments and the like is astounding. They are making out as if this is the time of your life to buy a property. I mean they could be sages and this may be the best opportunity for the next 20 years to buy a house. However, you have to dig deep and do your research to realise that the downside of buying at the moment could be quite large, very few (if any) point out that debt is an amplifier when it comes to gains or losses. I mean if you were to buy now with a no / low -deposit loan (as a significant group of first home owners will be) and prices were to fall 10%, your looking at negative equity or treading water and possibly in some trouble! This side of the coin I haven't read anywhere (apart from people's personal opinions here and other informal places) and that worries me for the majority of people around my age who would dive in based on advice from parents (still stuck in the property boom mindset) and RE's / Lender's and Articles (paid for by the previous) who just see the $$$$$ when someone like this walks in.

    The government grant while it is a significant help to people who have planned and are prepared for home ownership, I believe it is a very risky propisition for others, reason being, the more I read on the topic, the more I believe you can in no way 'impulse buy' when it comes to real estate, unless you want to get burned. And when (and it has to come eventually) the grant does run out, it will be very interesting how the sub 500k market fares as the drop off in demand will be significant and as a consequence should fall.

    Cheers,
    David
     
  8. dudek

    dudek Well-Known Member

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    Unfortunately housing market is one of not many industries left in this country. If you let it go you will see similar situation as in US and UK. It will drag everyone down-jobs in constriction, administration, tax revenues, local councils even local handy man.
    Gov. is manipulating RE to keep blood going in our economy. Whether you like it or not RE become main industry in this country. So to contradict your opinion I think tax payers are benefiting as long as RE is in healthy state. The cost of colapsing RE will be much greater to the tax payers.

    If you think many young people being sucked into the borrowing to buy first homes that is your right to do so. Jut like other posts about marging landing it is your decision and no one should be blamed if you get it wrong.

    Most important is to not follow “sheep mentality”.
    If you are due to purchase property and you were waiting for this moment for the last 3-4 years why not to take advantage of low rates and gov. incentives? They may not be available in six months time.
    No one forces anyone into buying; it’s your decision and should not be influenced by media speculation.

    PS. Since when intelligent person in this country listens and trusts what politicians are saying?
     
  9. Simon Hampel

    Simon Hampel Co-founder Staff Member

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    FWIW - I'm not convinced that a FHOG for existing dwellings is such a fantastic idea (even though as an investor, I benefit from demand at that end of the market).

    However, I do believe that there is scope for a lot more residential housing development in Australia to soak up some of the strong demand of recent years - and encouraging development via a FHOG for purchasing newly built properties will both help with housing shortfalls and prop up the building industry and provide a lot of ongoing employment.
     
  10. Chris C

    Chris C Well-Known Member

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    The government is proping up a clearly flawed system which only delays our ability to fix the system by letting it collapse and starting from scratch. I'm not saying the price falls won't be painful to bare, but the alternative is a long winded recession of house prices.

    Also, extremely high levels of household debt required to buy housing doesn't do the economy any favours either, and it's part of the reason the world is collapsing like it is. So you can't justify the maintainance of inflated house prices when you take into account the ineffecient levels of debt households have taken out to speculate on housing.

    I have no problem with people running out there and over paying for housing because of low interest rates, but I do have a problem with government artificially stimulating the market forcing prices up unnaturally. Plus all of us as tax payers should be annoyed by the policy as well - it really doesn't serve Australia in the long run.

    In life taking short cuts is the longest way to any point. This FHOG policy is no different. It's bad policy that politicians are using to try to cover up a market imbalance rather than let Australia (along with government and the RBA) face up the music. Oh and it also wins votes...

    The figures are with me on this one. It's been well documented that there has been a substancial increase in FHO obtaining new loans and buying houses since the new FHOGs.

    I got no problem with people buying houses, I only take issue with the government offering unnnatural incentives that incline people to "take advantage" of the system that otherwise wouldn't be in the market for a house.

    LMAO! Everything is influenced by the media. They are the gate keepers of information and what infomation they let out is biased towards specific agendas. Right now the dumb logic of "spend for your country" seems to be reigning supreme, but it's so counter productive to REAL long term growth.

    You're right, intellegent people don't. It's just really unfortunate the country is not full of "intelligent" people, or maybe a better word than intellegent is "informed". The truth is the average person in Australia is so grossly misinformed they have to believe what politicians and media tell them.

    To be completely honest every time I watch Swanny give an economic assessment of the country I wonder if he REALLY understands what he is talking about or is he just a government puppet like so many politicians are...