Perth housing crash
- Thread starter VineyIsLORD
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What a strange thread.
VineyisLORD sure has some weird ideas about life in WA. He either doesn't live in Perth or if he does, doesn't go outside. If you took his comments about Perth on face value you'd think the whole city is bankrupt and homeless.
FYI, WA has a GSP per capita nearly twice that of all other mainland states. And the less said about Tassie the better.
VineyisLORD sure has some weird ideas about life in WA. He either doesn't live in Perth or if he does, doesn't go outside. If you took his comments about Perth on face value you'd think the whole city is bankrupt and homeless.
FYI, WA has a GSP per capita nearly twice that of all other mainland states. And the less said about Tassie the better.
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You pretend to speak with authority on something you know nothing about.
Regulation has increased dramatically on the banking sector in recent years not been deregulated
VineyIsLORD
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- #80
I am referring to the deregulation under Howard that led to the bubble forming.
Post 2008 some of that was clawed back as we provided the big 4 and MacBank with huge bailouts in the form of the bank guarantee.
I see no housing crash in Perth. Normal market forces like everywhere else. Been a good few years which is usually followed by dead and down times for quite a number of years which means significant falls in cooked areas. Normality is fine by me coz it is isn't a short term investment. Vacancy rates for those new chicken coups around inner Syd and Melb (esp the high rise) are far worse than reported, but that's also normal. Nobody in that industry wants to evr advertise pain when they rely upon duping people into paying on or close to the offered side.
The spread alone is usually >5% just between bid and offer. i.e. on a flat mkt buying at the sellers price and selling to the buyers price. As soon as you start buying at the sellers price on a toppish market and a few yrs later try to sell to very few buyers on a bear market that has come off a bit (with SD, +rent, -int, agents, etc etc etc)...the losses can be a lot larger than you think in reality. Say u purchase a place for maybe $1m, you should be thinking it is truly worth perhaps $900K to begin with, because that is a flat market. That is normal. The reality can be far worse. If there is a genuine downturn in prices of maybe 10-15%+ that can rapidly become a 20- 25% hit from what you paid on a surging mkt....there is nothing abnormal or extreme about that. You cant buy bargains after a surge, and anyone saying you can will have a vested interest.
Noone advertises an end to a surge....it is up to you to recognise when it becomes simply a broker driven market propped up with dumb money and thin air underneath it.
Enjoy life is the main thing, and don't get duped into thinking you must do something especially when young. There is also nothing wrong with realising a loss if you need to. We do what we need to do...and if it seriously effects your lifestyle, mindset or health don't be afraid to take the hit on the chin and get back to enjoying life. You can always make more money but we only get one life.
The spread alone is usually >5% just between bid and offer. i.e. on a flat mkt buying at the sellers price and selling to the buyers price. As soon as you start buying at the sellers price on a toppish market and a few yrs later try to sell to very few buyers on a bear market that has come off a bit (with SD, +rent, -int, agents, etc etc etc)...the losses can be a lot larger than you think in reality. Say u purchase a place for maybe $1m, you should be thinking it is truly worth perhaps $900K to begin with, because that is a flat market. That is normal. The reality can be far worse. If there is a genuine downturn in prices of maybe 10-15%+ that can rapidly become a 20- 25% hit from what you paid on a surging mkt....there is nothing abnormal or extreme about that. You cant buy bargains after a surge, and anyone saying you can will have a vested interest.
Noone advertises an end to a surge....it is up to you to recognise when it becomes simply a broker driven market propped up with dumb money and thin air underneath it.
Enjoy life is the main thing, and don't get duped into thinking you must do something especially when young. There is also nothing wrong with realising a loss if you need to. We do what we need to do...and if it seriously effects your lifestyle, mindset or health don't be afraid to take the hit on the chin and get back to enjoying life. You can always make more money but we only get one life.
I am currently in Perth for the first time ever, specifically West Perth, and the amount of office space for lease is frightening!
That must have a direct impact on small business and the construction industry. ....resulting in a negative spiral.
Things will surely get a lot worse for Perth before they get better? ??
That must have a direct impact on small business and the construction industry. ....resulting in a negative spiral.
Things will surely get a lot worse for Perth before they get better? ??
Power Raid
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West Perth was the capital of junior mining and rents of $600 plus per square metre could be absorbed in the good times.
Since 2008 there has been an increasing trend to spread out from apple cross, Belmont and balcatta.
Most assets are now global and with technology there is no longer the need to centralise.
The exploration boom has started again but it will take another 2 years to see publicly but it is happening within the stables.
Power Raid
We Exist To Win Premierships
ASIC are more incompetent than corrupt
And I'd support secession as the economies of the east and west are not compatible. We would benefit greatly by having two currencies and perhaps the east would still have manufacturing if that was the case.
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Things were ok in WA before the boom and they will be ok after, they just won't reach the heady heights of the early 2000s. There will be a period of adjustment, but anyone thinking the state will become a basketcase is overstating the issue. There is still mining and business in this town, just not at the levels seen when all the mines were starting up.
VineyIsLORD
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Except more job losses are coming. And the population of WA wasnt as highly leveraged in the early 00s as it is now.
It wont fail or anything though.
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- #87
We didn't bail out any of our banks... Didn't spend a cent. I think you are confusing Australia with the US
VineyIsLORD
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Deposit guarantee. We absolutely bailed out MacBank in particular it just wasnt explained well to the public.
Heres a good article on it http://mobile.abc.net.au/news/2014-...its-now-taxpayers-who-need-protection/5878418
Why do people want to blame anything and everything on our successive governments, companies or banks ?
Then there are the Gina's and Twiggy's who employ tens of thousands CREATING livelihoods.
When a market is solid nobody congratulates the Twiggy's, guvments or banks, nor says thankyou for the opportunity/livelihood. As soon as things are slow or in a cyclical decline out come the knives and all the moronic alternative notions under the sun. Suddenly the dimwits expect the banks guvments and Ginas of the world to pay a massive price rescuing them from their own decisions.
You make your own decisions in life, and deal with it. WA has always been muted boom bust.
If it was a singular mining town the market would be a hellova lot worse than it is. It simply looks like a perfectly normal dead/soft market.
Deal with the norm.
Then there are the Gina's and Twiggy's who employ tens of thousands CREATING livelihoods.
When a market is solid nobody congratulates the Twiggy's, guvments or banks, nor says thankyou for the opportunity/livelihood. As soon as things are slow or in a cyclical decline out come the knives and all the moronic alternative notions under the sun. Suddenly the dimwits expect the banks guvments and Ginas of the world to pay a massive price rescuing them from their own decisions.
You make your own decisions in life, and deal with it. WA has always been muted boom bust.
If it was a singular mining town the market would be a hellova lot worse than it is. It simply looks like a perfectly normal dead/soft market.
Deal with the norm.
VineyIsLORD
Norm Smith Medallist
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Bollox, the taxpayers have taken on the risk for hundreds of billions in debt by the banks.
And our payment for that risk is that we have the most indebted nation on earth, with 70% of that debt tied to the basic human need of shelter.
The government was complicit by deregulating the industry and bailing out the banks for their own mistakes.
Twiggy and Gina arent providing jobs. They exploit a natural resource that belongs to all Australians, and a vast majority of Australians are seeing no benefit from it.
So thats why the banks, billionaires and government are the target: because it is their fault.
Geeezus
Grow up
You sound like a student union flog that hasn't quite grown up and discovered the real world yet.
The politics of blame and envy right there.
Get on with your life man. If you aint happy with the one you have then create a new one starting today. We live in a wonderful country with cushioned lows and the occasional spikes.
It may not be perfect but it aint about to change according to you your cereal box notions....so you may as well get on for the ride coz it doesn't last long.
Grow up
You sound like a student union flog that hasn't quite grown up and discovered the real world yet.
The politics of blame and envy right there.
Get on with your life man. If you aint happy with the one you have then create a new one starting today. We live in a wonderful country with cushioned lows and the occasional spikes.
It may not be perfect but it aint about to change according to you your cereal box notions....so you may as well get on for the ride coz it doesn't last long.
VineyIsLORD
Norm Smith Medallist
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Oh I thought we were just debating the issue and the multiple causes of the bubble.
It seems you want to pretend to be some capitalist straight shooter type who looks down on the people who genuinely know what they are talking about. Thats cool.
Let me know when you are keen to get back on topic.
Might i suggest reading about the topic? That way you wont have to rely on emotion so much which results in posts with zero substance.
I've never understood the concept that Iron Ore mined by somebody else, 2,000 kms away, belongs to me and all Australian's. Does the lemon that grew on the tree in my back yard belong to all Australian's, should they all benefit from it?
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It's a flawed analogy because lemons are renewable but people do get carried away with resource 'ownership'.
The DRC has tens of trillions worth of mineral resources yet has a GDP per capita in the hundreds. There's a lot more to a prosperous resources industry than just minerals in the ground.
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Yes and no.
When the Perth market boomed, Melbourne stayed relatively flat. Yet, market conditions in Melbourne and it's attractiveness as a city will probably continue to push up prices even as other cities may cool.
The local economy is not dependant on mining but the service sector. Even as youth unemployment is high, there is still service sector growth, likewise, higher ed is a growth area and the cities livability and the FT deal with China is going to attract a lot more investment. Not Vancouver or New York level, given one provided strong incentives and the other has the combination of being the financial centre and massive demand, but it is still quite attractive to Chinese buyers, where it only takes a small amount of Chinese money to have a big impact.
The inner west is going to gentrify quickly, not at the same pace as say Brooklyn, because Australia lacks the large population of the US, though at pace.
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It is a misnomer though that the Chinese focus on apartment living. How many of those developments depend on Singaporean and Saudi/Qatar money?
Much like Canada, I think they will buy up the suburbs. It's Malay/Chinese families with students in Australia that buy apartments in Melb. But longer term small investors will look to the West and North.
If new restrictions cause a drop in overall investment, I wouldn't be surprised if the Chinese find holes in any FT stipulations, especially around employment that allow them to get family and money into Aus. With Chinese market queries and the tightening of Gov control, more capital will leave China. The only issue would be tightening of lending rules. Chinese can use shares as colateral for loans, though would the government intervene.
Finally, what people also need to consider is the SE Asian boom. Especially Vietnam. With large student contingents in Melb and Syd, already reasonable expat communities and the massive increase in capital flowing into Vietnam as Chinese and Western countries vie for influence and factory jobs shift from China, there is going to be a new investor class growing out of the country.
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- #99
Just means more young people will move inner city. It's the suburbs that will hurt. Also, a lot of those properties are short term lease at high prices, not negatively geared investment. Whilst demand may drop in the short term, how many will be airbnb rentals soon.
West Perth is close to ammenities, hard to imagine it will depreciate massively med term. Perth is in for a correction, however established outer suburbs will be hit hardest. Demand may also dip for new developments but if Labor gets in, then investment will move from established to new, which may keep building going at a pace.
Power Raid
We Exist To Win Premierships
not west perth but the telstra building in east perth/ northbridge sold for $85m in circa 2011. It is up for sale now for $45m and will likely go for $39m.
West Perth is similar with 50% falls for those "forced" to sell. ride it out two years and things will look a lot more normal and be around 10%-15% from highs.
note commercial is hit harder than residential ATM
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