Society/Culture Australian Property Prices to Crash?

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Gigantic

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I dunno - this sounds good to me. People can just buy, know what they will be paying, and the payment adjusted for inflation will become smaller over time.
It's actually always surprised me why Australia doesn't have more longer-term fixed rate mortgages. I would have thought our capital markets is large enough to be able to have the liquidity to support it.

FWIW France have had long term fixed rate mortgages at like, what, less than 1%? The US also have long term fixed rate mortgages too. Both countries are leaders in wealth inequality - is it the chicken or the egg? Or no effect at all towards their problems?
 
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Taylor

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I dunno - this sounds good to me. People can just buy, know what they will be paying, and the payment adjusted for inflation will become smaller over time.
The banks could bundle them together and sell them as bond like products too, especially if the reserve banks are really shy to raise interest rates because their economies were already on life support.
 

Number37

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The banks could bundle them together and sell them as bond like products too, especially if the reserve banks are really shy to raise interest rates because their economies were already on life support.
Mortgage backed securities.
We already saw that movie, it doesn't end well for home buyers.
 

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HirdsTheWord

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Yet you say Capitalism is fine ?
I provide an example where someone (in this case a celebrity) outbids others by about 15% driving the house price up by nearly $1,000,000 and you are ok with it ?
Yet on the other hand you are adamant that we need to remove investors from the market?

Having a hard time getting a read on your actual solutions to the problem?

I think the government does include infrastructure in its planning it just gets blocked at every level until everyone has got their piece of the pie ( ever watched Utopia ?)

So I’m a property investor and in true capitalist form I am hoping my properties increase in value over my lifetime so I have sufficient funds to retire with , meanwhile providing affordable rental accommodation for people who require it ( haven’t put our rent up in about 4 years and kept the same happy tenants 🀞)

Is it ok that I’m capitalist but not ok that I’m an investor? I’m confused?!

Your solutions whereby the government provides affordable housing is in fact sound more socialist than capitalist.
A balance of both would be ideal IMO but where does the government get that kind of money ?

Their current capitalist model incentivising investors to build more housing satisfies this demand .

Perhaps what we are both saying is that investment incentives are ok for new housing but should not extend to buying existing properties?
if he’s going to live in it I don’t care how much he pays for it, this isnt the issue affecting the housing market.

my issue is investors who already have wealth being allowed tax breaks over people who don’t have wealth. This isn’t capitalism, it’s wealth inequality. It is not an equal system.

if you can afford your investment properties without tax breaks than good for you, I have zero issue with that…but you should not be receiving tax breaks for owning multiple homes when people are struggling to buy their first, and get zero tax benefits to do so.

This is is the single issue with the housing market, it creates nothing but more expensive houses and creates wealth inequality. It is wrong.
 
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HirdsTheWord

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This is the UK, but 40 year fixed-rate mortgage... :oops:

View attachment 1285411
why are you surprised?, this will be Australia within a decade.

the more the average Mortage amount grows the more the term will be to allow people to pay it off. This is the aging workforce we are heading for all because this inept fu**in government does nothing to fix the issue now. they Prefer to line their own pockets and their wealthy voters instead of doing what’s right for future generations.

it’s a sh*t show.
 

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Madas

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How is Andy Lee an idiot. He has the cash and its not at the expense of a first home buyer.
Because his FOMO has led him to pay way more than that property is worth and exacerbate the problem of people creating these ridiculous bubble economies that just aren’t sustainable.

It’s just a show off wank , look at me , I’ve got $8 million dollars
Could have bought an amazing house for $2 million and used the rest to create housing for the homeless or victims of domestic violence.

That’s why !
 

Madas

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if he’s going to live in it I don’t care how much he pays for it, this isnt the issue affecting the housing market.

my issue is investors who already have wealth being allowed tax breaks over people who don’t have wealth. This isn’t capitalism, it’s wealth inequality. It is not an equal system.

if you can afford your investment properties without tax breaks than good for you, I have zero issue with that…but you should not be receiving tax breaks for owning multiple homes when people are struggling to buy their first, and get zero tax benefits to do so.

This is is the single issue with the housing market, it creates nothing but more expensive houses and creates wealth inequality. It is wrong.
No
One person having $8 million to spend on a piece of crap house is wrong .

I’m sorry but you just aren’t acknowledging the reasoning behind why these incentives exist therefore I can’t continue this debate .
They have purpose and have been used to effect over many years to create housing stock .
Almost guarantee AndyLee and many like him would have multiple investments and be working the tax system for all its worth .
 

Bombermania

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Because his FOMO has led him to pay way more than that property is worth and exacerbate the problem of people creating these ridiculous bubble economies that just aren’t sustainable.

It’s just a show off wank , look at me , I’ve got $8 million dollars
Could have bought an amazing house for $2 million and used the rest to create housing for the homeless or victims of domestic violence.

That’s why !
$8 million in that location would be for the land because the house is just a shell.
 

HirdsTheWord

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I dunno - this sounds good to me. People can just buy, know what they will be paying, and the payment adjusted for inflation will become smaller over time.
there is nothing good about an ageing workforce.

No
One person having $8 million to spend on a piece of crap house is wrong .

I’m sorry but you just aren’t acknowledging the reasoning behind why these incentives exist therefore I can’t continue this debate .
They have purpose and have been used to effect over many years to create housing stock .
Almost guarantee AndyLee and many like him would have multiple investments and be working the tax system for all its worth .
Negative gearing and other tax benefits worked once upon a time. It is no longer relevant or required in todays society. It was introduced when the avg house wasn’t 15 times the avg income which is only growing.

Andy Lee can pay 8m for whatever he wants if he can afford it.This just emphasises the point that he along with anyone else with wealth does not need tax breaks.

people cannot afford to buy their first home. Why should he and others who already have a property get these financial benefits? It’s bullshit and completely unfair to the younger generations.

creating housing stock means nothing if 1/4 of it is owned by a private investor. This is why home ownership % numbers are dropping. This is not a good thing.
 
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HirdsTheWord

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Because his FOMO has led him to pay way more than that property is worth and exacerbate the problem of people creating these ridiculous bubble economies that just aren’t sustainable.

It’s just a show off wank , look at me , I’ve got $8 million dollars
Could have bought an amazing house for $2 million and used the rest to create housing for the homeless or victims of domestic violence.

That’s why !
He can buy what he wants bro rofl. Him spending 8million on a house is not the issue, there is zero wrong with being successful.
 

Deliverance

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So I’m a property investor and in true capitalist form I am hoping my properties increase in value over my lifetime so I have sufficient funds to retire with , meanwhile providing affordable rental accommodation for people who require it ( haven’t put our rent up in about 4 years and kept the same happy tenants 🀞)

Is it ok that I’m capitalist but not ok that I’m an investor? I’m confused?!

Your solutions whereby the government provides affordable housing is in fact sound more socialist than capitalist.
A balance of both would be ideal IMO but where does the government get that kind of money ?

Their current capitalist model incentivising investors to build more housing satisfies this demand .

Perhaps what we are both saying is that investment incentives are ok for new housing but should not extend to buying existing properties?
Bolded is the problem here, all about me me me. Housing investment in this country is about building personal wealth. It's a selfish means to an unnecessary end. The person in your example could easily plow cash in to shares, super, bonds, cash or other investments and be perfectly well off for retirement. As it is, they're sucking up housing supply to the detriment of others. Investment properties are usually existing dwellings, they add very little to new housing stock. How many investors are sitting around thinking "Ooh, that migrant family in Melton probably can't afford a home, I'd better build one so they can have a roof over their heads"
 

Taylor

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Property is far more attractive as an investment because it's right there, you can touch it, it makes money and you can drive past it and it's right there.

If the world goes off a cliff you still own one house worth of investment, whatever that means. If the buying power of the dollar dives you've got a bigger number, but it's still one house. The reality is that your shares, your bonds, your super - none of which are worth a single cent to you if it hits the fan, but if you've got a house you still have a house, you still have somewhere to live. Even the money in the bank can disappear since there isn't enough cash available for people to all draw it out anyway.

Nobody is snuggling under their stock portfolio at night.

You need only look at how pensions haven't risen to see that it's not a me, me, me thing. Nobody should expect to be looked after adequately. People without aren't exactly giving things away after holding out their hand for years.

The solution is bulk, low cost housing built as a construction industry stimulus. Nobody with money will want to live there, demand will be purely low capacity owners - and people will still prefer to buy something $100,000 more expensive and an hour further away from the city AND complain about it.
 

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HirdsTheWord

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Property is far more attractive as an investment because it's right there, you can touch it, it makes money and you can drive past it and it's right there.

If the world goes off a cliff you still own one house worth of investment, whatever that means. If the buying power of the dollar dives you've got a bigger number, but it's still one house. The reality is that your shares, your bonds, your super - none of which are worth a single cent to you if it hits the fan, but if you've got a house you still have a house, you still have somewhere to live. Even the money in the bank can disappear since there isn't enough cash available for people to all draw it out anyway.

Nobody is snuggling under their stock portfolio at night.

You need only look at how pensions haven't risen to see that it's not a me, me, me thing. Nobody should expect to be looked after adequately. People without aren't exactly giving things away after holding out their hand for years.

The solution is bulk, low cost housing built as a construction industry stimulus. Nobody with money will want to live there, demand will be purely low capacity owners - and people will still prefer to buy something $100,000 more expensive and an hour further away from the city AND complain about it.
This is why superannuation is important and your point only highlights the flaws of what the government has created and has cultivated over the last 20 years, Housing should never been an investment scheme. Housing is not a commodity, it is a necessary means to put shelter over your head.

1/4 homes in this country being owned by a private investor is a disgrace. The supply argument is utter bullshit. There are more than enough homes in this country to cater for its population if you remove investors.

We need more people owning their own home going into retirement, so they are less reliant on government pensions. Home ownership across ALL age groups is dropping, including people about to go into retirement currently dropping. The only ownership % that is rising is Private Investors. This is not a good thing.

People do not need to own multiple properties at the detriment of future generations ability to buy their home.

The system as it stands is a sh*t show for everyone except the wealthy and its getting progressively worse year on year, someone needs to start seriously thinking how a kid born is 2020 is going to afford a house in 2050 without a hand out. Something needs to be done now.
 
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Madas

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$8 million in that location would be for the land because the house is just a shell.
Emphasis the point even further sorry .
The point is that someone who isn’t even funny has got $8m to spend on a shell .
If he was smart he would wait 2 years when the price of that place comes back down 20% plus .
 

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Emphasis the point even further sorry .
The point is that someone who isn’t even funny has got $8m to spend on a shell .
If he was smart he would wait 2 years when the price of that place comes back down 20% plus .
So why has he got the 8m in the first place?
 

Taylor

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This is why superannuation is important and your point only highlights the flaws of what the government has created and has cultivated over the last 20 years, Housing should never been an investment scheme. Housing is not a commodity, it is a necessary means to put shelter over your head.

1/4 homes in this country being owned by a private investor is a disgrace. The supply argument is utter bullshit. There are more than enough homes in this country to cater for its population if you remove investors.

We need more people owning their own home going into retirement, so they are less reliant on government pensions. Home ownership across ALL age groups is dropping, including people about to go into retirement currently dropping. The only ownership % that is rising is Private Investors. This is not a good thing.

People do not need to own multiple properties at the detriment of future generations ability to buy their home.

The system as it stands is a sh*t show for everyone except the wealthy and its getting progressively worse year on year, someone needs to start seriously thinking how a kid born is 2020 is going to afford a house in 2050 without a hand out. Something needs to be done now.
Houses don't appear, with all the work involved in them, out of need from nothing.

The need doesn't create the solution, the means do. Investors have the means.

I agree in principle that everyone should have shelter but it's not like every shelter is equal. As I said above, you would have trouble giving away low cost housing in bulk buildings built by the government because people want nice things.

Nice things cost money
 

Madas

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Bolded is the problem here, all about me me me. Housing investment in this country is about building personal wealth. It's a selfish means to an unnecessary end. The person in your example could easily plow cash in to shares, super, bonds, cash or other investments and be perfectly well off for retirement. As it is, they're sucking up housing supply to the detriment of others. Investment properties are usually existing dwellings, they add very little to new housing stock. How many investors are sitting around thinking "Ooh, that migrant family in Melton probably can't afford a home, I'd better build one so they can have a roof over their heads"
I’m talking about building new houses as investments and don’t get me started about the I bit .
If we are all happy to live in a capitalist economy then unfortunately whether you like it or not it’s all about I .
If you want to have a discussion about democratic socialism we need to roll over to another thread because this one is about house prices being unaffordable.
I for one abhor the social disparity and wealth inequality that Capitalism brings but I like it’s freedoms.
Reading some of Ayn Rands works opened my eyes to the mechanisms of both systems and their benefits.





Property is far more attractive as an investment because it's right there, you can touch it, it makes money and you can drive past it and it's right there.

If the world goes off a cliff you still own one house worth of investment, whatever that means. If the buying power of the dollar dives you've got a bigger number, but it's still one house. The reality is that your shares, your bonds, your super - none of which are worth a single cent to you if it hits the fan, but if you've got a house you still have a house, you still have somewhere to live. Even the money in the bank can disappear since there isn't enough cash available for people to all draw it out anyway.

Nobody is snuggling under their stock portfolio at night.

You need only look at how pensions haven't risen to see that it's not a me, me, me thing. Nobody should expect to be looked after adequately. People without aren't exactly giving things away after holding out their hand for years.

The solution is bulk, low cost housing built as a construction industry stimulus. Nobody with money will want to live there, demand will be purely low capacity owners - and people will still prefer to buy something $100,000 more expensive and an hour further away from the city AND complain about it.
Thank you and agreed .
When I was in my twenties ( 30 odd years ago) we were told very succinctly that we needed to fund our own retirement because by the time it came around there would be a pittance of a pension . So we were encouraged to invest .
Many of us weren’t bought up in families where share trading was even discussed so had no idea on how that works. Many entered the trade environment and have been largely self employed since , most S/E tradies back in those days didn’t contribute to superannuation , the young ones now are getting smarter .
Agree in emphatically that in my personal circumstance I prefer to drive past my investment and know that everyone needs a house to live in , so as long as you haven’t leveraged yourself too far you should be able to ride through recessions when they come . I know people 20 years older than me that lost everything they own including their house in the GFC crash as it was all tied up in shares and SMSF.
Share trading to me requires a lot market research and preferably insider knowledge , not something many of us have .
 

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Houses don't appear, with all the work involved in them, out of need from nothing.

The need doesn't create the solution, the means do. Investors have the means.

I agree in principle that everyone should have shelter but it's not like every shelter is equal. As I said above, you would have trouble giving away low cost housing in bulk buildings built by the government because people want nice things.

Nice things cost money
There is nothing wrong with your stance, however my point is Investors should not be given financial benefits (via tax breaks etc) to buy additional properties when someone buying their first home does not get these benefits.

Why should someone who already has wealth, be given benefits to create more wealth over someone who doesn't?.

It makes ZERO sense.
 

HirdsTheWord

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I’m talking about building new houses as investments and don’t get me started about the I bit .
If we are all happy to live in a capitalist economy then unfortunately whether you like it or not it’s all about I .
If you want to have a discussion about democratic socialism we need to roll over to another thread because this one is about house prices being unaffordable.
I for one abhor the social disparity and wealth inequality that Capitalism brings but I like it’s freedoms.
Reading some of Ayn Rands works opened my eyes to the mechanisms of both systems and their benefits.






Thank you and agreed .
When I was in my twenties ( 30 odd years ago) we were told very succinctly that we needed to fund our own retirement because by the time it came around there would be a pittance of a pension . So we were encouraged to invest .
Many of us weren’t bought up in families where share trading was even discussed so had no idea on how that works. Many entered the trade environment and have been largely self employed since , most S/E tradies back in those days didn’t contribute to superannuation , the young ones now are getting smarter .
Agree in emphatically that in my personal circumstance I prefer to drive past my investment and know that everyone needs a house to live in , so as long as you haven’t leveraged yourself too far you should be able to ride through recessions when they come . I know people 20 years older than me that lost everything they own including their house in the GFC crash as it was all tied up in shares and SMSF.
Share trading to me requires a lot market research and preferably insider knowledge , not something many of us have .
There are zero issues with living in a capitalist society so I agree with you.

My issue is wealthy people are given investment tax benefits to accumulate more wealth over first time home buyers who do not have access to the same benefits.
 

Madas

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This is why superannuation is important and your point only highlights the flaws of what the government has created and has cultivated over the last 20 years, Housing should never been an investment scheme. Housing is not a commodity, it is a necessary means to put shelter over your head.

1/4 homes in this country being owned by a private investor is a disgrace. The supply argument is utter bullshit. There are more than enough homes in this country to cater for its population if you remove investors.

We need more people owning their own home going into retirement, so they are less reliant on government pensions. Home ownership across ALL age groups is dropping, including people about to go into retirement currently dropping. The only ownership % that is rising is Private Investors. This is not a good thing.

People do not need to own multiple properties at the detriment of future generations ability to buy their home.

The system as it stands is a sh*t show for everyone except the wealthy and its getting progressively worse year on year, someone needs to start seriously thinking how a kid born is 2020 is going to afford a house in 2050 without a hand out. Something needs to be done now.
You know what , I agree with you and have all along but only in the differentiation between investors receiving incentives to build new housing as compared to buying existing properties.
One of the simple solutions to tackle unaffordability would be to remove tax incentives to buy existing properties.

Another thing I see as a solution is working with my local council to try and create aesthetically pleasing , well located but affordable group dwellings that take up less land and share common infrastructure costs .
I’m really looking forward to working on these projects in my final years before retirement to say I’ve tried to contribute to this growing problem.
 

FRUMPY

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Because his FOMO has led him to pay way more than that property is worth and exacerbate the problem of people creating these ridiculous bubble economies that just aren’t sustainable.

It’s just a show off wank , look at me , I’ve got $8 million dollars
Could have bought an amazing house for $2 million and used the rest to create housing for the homeless or victims of domestic violence.

That’s why !
:rolleyes: πŸ€¦β€β™‚οΈ
 

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