Society/Culture Australian Property Prices to Crash?

[FIGJAM]

100s of 1,000s returned home to Australia during this period.

Plenty of ex-pats came home, but our inflow of people went backwards during the 2020 to 2021 period, which was when we had the sharpest price rises.

Overseas Migration, 2022-23 financial year

Statistics on Australia's international migration, by state and territory, country of birth, visa, age and sex.

www.abs.gov.au

Low interest rates helped price-increases in 2020-21, but the reality is that low supply has been an issue for sometime and even with diminished population growth over that period.

We continued to hand out the same visa numbers over the 2020-21 period and when all of those new and existing visa holders who chose to wait i out the pandemic, as well as the student market came back in 2022, we've seen the sharpest rental increases in living memory and price increases in the housing market last year in spite of interest rate increase after interest rate increase.

Australians are heavily geared and we are susceptible to major economic shocks, but if the shock(s) don't happen, then don't expect prices to crash anytime soon. This thread is now over 5 years old.

 

[peetoo]

100s of 1,000s returned home to Australia during this period.

Not on the plane I was in. Really surprised the estimated 30-40k mentioned in media weren’t rushing in in the first month or so

 

[leon123]

Plenty of ex-pats came home, but our inflow of people went backwards during the 2020 to 2021 period, which was when we had the sharpest price rises.

Overseas Migration, 2022-23 financial year

Statistics on Australia's international migration, by state and territory, country of birth, visa, age and sex.

www.abs.gov.au

Low interest rates helped price-increases in 2020-21, but the reality is that low supply has been an issue for sometime and even with diminished population growth over that period.

We continued to hand out the same visa numbers over the 2020-21 period and when all of those new and existing visa holders who chose to wait i out the pandemic, as well as the student market came back in 2022, we've seen the sharpest rental increases in living memory and price increases in the housing market last year in spite of interest rate increase after interest rate increase.

Australians are heavily geared and we are susceptible to major economic shocks, but if the shock(s) don't happen, then don't expect prices to crash anytime soon. This thread is now over 5 years old.

sensible post.

another factor was decreasing household size (unexpected as well). Dont quote me exactly. but it was about a decrease of 0.2... which is significant.... so for a given population more dwellings are required

 

[Purple7x08_24]

One thing I can't understand with interest rates being as high as they are is how people have the money to do anything. I live in a tourist area and today and there were s**t loads of tourists out and about eating in cafes etc. They're selling pies for $10 in bakeries. I know they're ******* good but $10. Only thing I can think of is we have a large proportion of people in society with enough money to keep spending while the other portion struggles.

 

[Nuggs Bunny]

One thing I can't understand with interest rates being as high as they are is how people have the money to do anything. I live in a tourist area and today and there were s*t loads of tourists out and about eating in cafes etc. They're selling pies for $10 in bakeries. I know they're ****** good but $10. Only thing I can think of is we have a large proportion of people in society with enough money to keep spending while the other portion struggles.

People who bought their houses ten years ago probably. Interest rate rises disproportionately affect recent borrowers, people who own outright or are halfway through a mortgage hardly suffer.

 

[Frank Grimes]

One thing I can't understand with interest rates being as high as they are is how people have the money to do anything. I live in a tourist area and today and there were s*t loads of tourists out and about eating in cafes etc. They're selling pies for $10 in bakeries. I know they're ****** good but $10. Only thing I can think of is we have a large proportion of people in society with enough money to keep spending while the other portion struggles.

The interest rates are not that high by historical standards. It's about the same as it was in the mid 00's (or less if anything).

The difference is probably people were taking out smaller loans back then, but recent buyers are taking out bigger loans so they will feel the impact if the increases more.

 

[Carringbush2010]

One thing I can't understand with interest rates being as high as they are is how people have the money to do anything. I live in a tourist area and today and there were s*t loads of tourists out and about eating in cafes etc. They're selling pies for $10 in bakeries. I know they're ****** good but $10. Only thing I can think of is we have a large proportion of people in society with enough money to keep spending while the other portion struggles.

Correct.

Msm and social media has you believe that just about everyone is doing it tough, when it's probably not the case.

 

[greyhound punter]

The interest rates are not that high by historical standards. It's about the same as it was in the mid 00's (or less if anything).

The difference is probably people were taking out smaller loans back then, but recent buyers are taking out bigger loans so they will feel the impact if the increases more.

A lot of people I know are coming into inheritances as their parents move onto the next world. That wealth is getting cashed out into real spending money, rather than just being made up valuations on Domain.

One thing to be counting pennies every fortnight, it is a totally different ballgame to have $800 000 hit your account. That money is going to drive inflation as it is cashed out into cold cash. That money isn't locked up in an asset anymore.

Also, a lot of people are expecting interest rates to be cut and are probably not worried about spending a bit more.

The future is always crazier than we think.

 

[greyhound punter]

Correct.

Msm and social media has you believe that just about everyone is doing it tough, when it's probably not the case.

The issue will be when/of inflation returns. Any long term bull market, the first decent pullback is never the one to break the back of the market. The bulls/longs are thinking to "buy the dip".

The next leg down is another story. Especially if the prevailing narrative is that happy days are here again.

 

[Madas]

A lot of people I know are coming into inheritances as their parents move onto the next world. That wealth is getting cashed out into real spending money, rather than just being made up valuations on Domain.

One thing to be counting pennies every fortnight, it is a totally different ballgame to have $800 000 hit your account. That money is going to drive inflation as it is cashed out into cold cash. That money isn't locked up in an asset anymore.

Also, a lot of people are expecting interest rates to be cut and are probably not worried about spending a bit more.

The future is always crazier than we think.

I don’t think I’ve agreed with many of your posts on this thread but i definitely agree on this one

The inheritance factor is scary and real
I’m seeing a hell of a lot of young and not so young people coming into money and that is pumping the real estate value in our area even higher .

Goes against your argument that prices are going to crash though so I guess we are back on an even keel

 

[Carringbush2010]

The issue will be when/of inflation returns. Any long term bull market, the first decent pullback is never the one to break the back of the market. The bulls/longs are thinking to "buy the dip".

The next leg down is another story. Especially if the prevailing narrative is that happy days are here again.

Regardless, those who bought in the 'dip' or those who can afford to do so are not the minority.

Look around, people still buying $10 pies in tourist areas in packed cafes.

My point is not whether or not property prices are about to crash, but rather, on every single social and political issue the noise has you believe or at least portrays things as the 'norm' which it probably isn't.

 

[peetoo]

One thing I can't understand with interest rates being as high as they are is how people have the money to do anything. I live in a tourist area and today and there were s*t loads of tourists out and about eating in cafes etc. They're selling pies for $10 in bakeries. I know they're ****** good but $10. Only thing I can think of is we have a large proportion of people in society with enough money to keep spending while the other portion struggles.

Interest rates higher help many people

 

[peetoo]

Most economic variations are driven by demographics

 

[leon123]

Most economic variations are driven by demographics

Yep..... china good example at the moment....and russia. Ageing population and little in migration of young people