Society/Culture Australian Property Prices to Crash?

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sdfc

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Feb 15, 2019
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Lowering rates is fine but they waited way too long. We have known for months that inflation was going to go up a lot. And they sat on their hands.

The longer they waited the worse the housing market got.
Keeping rates too low fuelled the increase in household debt to truly astronomical levels. The housing market was a mess before covid.

Cutting rates to push inflation up to an arbitrary target of 2% to 3% during a period of disinflation drove household debt to around 180% of disposable income pre-covid.

There are no free lunches, loose monetary policy begets financial instability.
 

hamohawk1

Premiership Player
Feb 18, 2011
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Lowish clearance rate (around 50%) but stock levels are still pretty consistent/ lower than normal over the past 2/3 years. Next months rate rise will be the point where people would be beginning to question whether its time to list or try weather the storm.
 

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Scotland

TheBrownDog
May 5, 2006
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The correction will be a fraction of the huge gains recently. Especially in blue chip areas. Press always put Mayo on it no matter the trend.

One of my friends has recently boarded the doom and gloom train. I've only been in the market a decade or so and I reckon I've heard that I'm going to lose 20-30% maybe 4 or 5 times.
 

Madas

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Aug 16, 2020
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One of my friends has recently boarded the doom and gloom train. I've only been in the market a decade or so and I reckon I've heard that I'm going to lose 20-30% maybe 4 or 5 times.
I reckon It’ll be 10% for an average correction and 20% if things get rough .
But if you can hang on 10 years it will come back and then it will go up even more
 

Scotland

TheBrownDog
May 5, 2006
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I reckon It’ll be 10% for an average correction and 20% if things get rough .
But if you can hang on 10 years it will come back and then it will go up even more

Each market and each market segment is different. And each property in each segment is different. Etc.

I just think the 'x% across the board' type statements do nothing but create panic.
 

Madas

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Aug 16, 2020
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Each market and each market segment is different. And each property in each segment is different. Etc.

I just think the 'x% across the board' type statements do nothing but create panic.
Nothing surer and making broad unfounded statements like I did is ridiculous
But I’m just conveying what I’ve seen in my 30 years in the work force and 25 years of property ownership
 

Scotland

TheBrownDog
May 5, 2006
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Nothing surer and making broad unfounded statements like I did is ridiculous
But I’m just conveying what I’ve seen in my 30 years in the work force and 25 years of property ownership

Could be even worse for some.

I take a what goes up must (should) go down view. Whatever has gone up the most recently should fall the hardest.

I did a refinance 8-9 months ago so kept an eye on similar sales. Some have been comparable, others I wouldn't want to be selling soon.
 
Jul 24, 2021
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Treechange and seachange places had been pretty stagnant for a decade or more. There was an even bigger post pandemic boost there. First places to suffer when the R word comes around
Yes.
People currently overpaying, but more so in country towns.
They are enjoying the pony club,cheap golf course , cutesy bakery and such.
But all over soon and a distinct lack of buyers in the next 5 years.
When they look for a local job their eyes will pop out and they will need to make the decision to drive to a major city for work.
 

Madas

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Treechange and seachange places had been pretty stagnant for a decade or more. There was an even than capital city bigger post pandemic boost there. First places to suffer when the R word comes around
Not sure about other places but our little town isn’t going backwards in a hurry
Everything has been sold (land and established houses) and there is still demand.
In fact the big money is just starting to come out

People who have bigger budgets and others who have been sitting on large properties are now coming out of the woodwork as the stimulus crowd tapers off .

We have had a huge influx of 30 something year old Covid Refugees who seem to do a whole bunch of not much work wise .
I think a lot of them may have impulsively bought land without doing any homework on build costs and realised how ridiculously expensive it is to build in rural areas.

I wonder if they are FIFO or maybe living the inheritance/ Crypto dream ?
Buggered if I know
 

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Gigantic

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Aug 31, 2014
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RBA spent a good part of the last decade constantly undershooting their 2-3% target. They've not had inflation within target for a while.

And because they're now so far behind the curve, they've overshot it.

All that being said, can only take the words coming out of Dr Lowe's mouth with a fine grain of salt.
 
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Kwality

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RBA spent a good part of the last decade constantly undershooting their 2-3% target. They've not had inflation within target for a while.

And because they're now so far behind the curve, they've overshot it.

All that being said, can only take the words coming out of Dr Lowe's mouth with a fine grain of salt.


Reserve Bank says inflation is rising, but he doesn't see a recession on the horizon​



'He says the RBA still thinks inflation will hit 7 per cent this year, up from 5.1 per cent currently, but it is monitoring the situation.

Mr Lowe has also admitted the RBA suffered "reputational damage" when it tried to wind back its COVID-19 pandemic stimulus program.

Speaking on Tuesday at an event in Sydney, the RBA Governor said the share of items in the consumer price index (CPI) basket experiencing annual price increases greater than 3 per cent was at its highest level since 1990.'

I'd love to believe you Mr Lowe ... sorry Dr Lowe.
 

Number37

Anyhow, have a Winfield 25.
Oct 5, 2013
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Reserve Bank says inflation is rising, but he doesn't see a recession on the horizon​



'He says the RBA still thinks inflation will hit 7 per cent this year, up from 5.1 per cent currently, but it is monitoring the situation.

Mr Lowe has also admitted the RBA suffered "reputational damage" when it tried to wind back its COVID-19 pandemic stimulus program.

Speaking on Tuesday at an event in Sydney, the RBA Governor said the share of items in the consumer price index (CPI) basket experiencing annual price increases greater than 3 per cent was at its highest level since 1990.'

I'd love to believe you Mr Lowe ... sorry Dr Lowe.


Reap what you sow Dr Lowe.

Should have lifted rates in Feb or March or April, probably even December last year.
 

Frank Grimes

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May 8, 2007
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Lowering rates is fine but they waited way too long. We have known for months that inflation was going to go up a lot. And they sat on their hands.

The longer they waited the worse the housing market got.
The ironic thing thing is that they were reluctant raise rates because they didn't want to be seen as doing it because they are influenced by the upcoming election when not raising them is the result of that perception when in normal times they would have raised them.
 

HairyO

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Jul 13, 2015
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The ironic thing thing is that they were reluctant raise rates because they didn't want to be seen as doing it because they are influenced by the upcoming election when not raising them is the result of that perception when in normal times they would have raised them.

Really should have started before the election. Even a single rate rise would have scared the market in to settling down. But doing to opposite and declaring no rate rises for 18 months was just disgraceful. Should be sacked, but wont.

When youre earning $1m a year it would be an expensive sacking - even though there is cause so they should not pay one cent.
 

Saint

Norm Smith Medallist
Feb 1, 2006
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RBA spent a good part of the last decade constantly undershooting their 2-3% target. They've not had inflation within target for a while.

And because they're now so far behind the curve, they've overshot it.

All that being said, can only take the words coming out of Dr Lowe's mouth with a fine grain of salt.

The RBA has stuffed this royally. I still don't know how they have a job. Just because they're independent doesn't mean they don't answer to anybody!

They fuelled a massive debt balloon and now they're deflating it far too quickly because they acted too slowly. They were 2 years off with the prediction of when rates would rise.

I don't think any other economist or even mild punter missed by as much as that. It's been nonsense predictions from them for over 6 months.
 

Golden_6

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Aug 15, 2014
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On SBS tonight among all the justified stories about hardship etc, they said mhouseholds got substantially richer in the march quarter alone (mainly property and super)
Two things that really mean nothing. Property prices and super don’t help with an individuals cash flow and living standards with rising costs. Houses are an inflated asset and somewhat irrelevant (unless you’re buying/selling under different market conditions) and super is more or less irrelevant to most people unless you’re close to retiring.
 

Kwality

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On SBS tonight among all the justified stories about hardship etc, they said mhouseholds got substantially richer in the march quarter alone (mainly property and super)

Its dollars in the pocket where inflation is felt, e.g $100+ to get out of a servo. Property values & super dont help feed the family.
 

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