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the last boom?

Discussion in 'Real Estate' started by Nigel Ward, 28th Mar, 2007.

  1. Nigel Ward

    Nigel Ward Team InvestEd

    10th Jun, 2005
    Interesting article about Sydney property market.

    The last great property boom? - National -

    I'm not sure Yardney's analysis is right, but at least he has a logical foundation for his forecast. Even if he's wrong though and the other suggestions of 20-30% peak to peak that's mentioned are right, that could be okay, provided the peaks aren't too far apart and/or you time your entry right...

    What do others think?

  2. Jacque

    Jacque Team InvestEd

    16th Jun, 2005
    Sydney is and will continue to remain a strong international city, that will always be in demand for renters and buyers alike. Affordability is perhaps the single largest issue affecting prices, however, and the last 3-4 years have seen a true stagnation/correction in prices, even in the so called "blue ribbon" suburbs.

    Not really agreeing with MY here, however, as the last two booms in the 90's and then in 02-04 were significant enough to cause overheating and overvaluing in the market, for which we are now paying for in terms of price drops and stagnations.

    After listening to John Edwards recently, I feel he is pretty spot on for his prediction of recovery in the next 18mths for Sydney, mainly due to rising rents and a shortage that will eventually cause investors to return to the market.
  3. Bricks & Mortar

    Bricks & Mortar Member

    4th Dec, 2006
    Melbourne, Vic
    Everything usually revolves around supply and demand
    Michael's prediction relys on the continuing rise in population, hence the next boom then a dwindling and possible receeding demand.

    If an increase migration or changes to the way we live does happen then his prediction of "a generation of baby boomers, born between 1946 and 1961, start entering their 70s from around 2020." would certainly have some effects on the market.
    It wont be the last big boom as eventually after that very long correction or lack of good growth period, the population will again revert back to the need for additional housing.

    But before us oldies fall off the perch :eek: there is also an increase demand in other areas. Aged care etc.

    Interesting times ahead.


  4. petros

    petros Member

    4th Apr, 2007
    The real estate market is inherently cyclical in every corner of the world. Cyclicality is due to the supply's inability to respond instantly to sudden demand shocks (either up or down). Price declines will gradually shut down capital flows to real estate development, and eventually new construction, vacancies will decline, and at some point when growth and demand will revert to strong growth the low pipeline will not be able to respond and prices will start rising strongly reenergizing development and supply and so on. So within this behavioral context no real estate boom is the last boom.....

    Profitable Property Investing in Perspective