funny, identical reasons quoted for CAD and GBP property markets. Why is that? Same course taken by salespeople ? At least GBP market is down close to 50% in AUD terms offering value due to AUD appreciation.
it would be good thing if that was true. foreigners pay property taxes and create GDP - locals have construction jobs and get cheap real estate when it crashes unfortunately bubbles in AUstralia and Canada are internal products and foreing investment just marginally involved
recent AU article : AU property will be down 15% in 10 years if immigration stop. Due to low yield on rental where 5% is lost if no appreciation this is really 15% +10*5% = 65% fall for investor. Implicit recognition that prices up because of imigration => 'lots of jobs because of high prices' and unfortunately not 'high prices because of good jobs'. QLD - more and more evidence high end down 50% from peak. If there are (international) buyers, why they dont buy 50% off beautiful villas ? Sure this will drag on prices elswhere in AU as part of property money will flow in QLD before pushing prices higher in elsewhere. Rates up in China again. not looking good...
Economic Bust in Australia:Near-Record Corporate Bankruptcies, Employment Drops Unexpectedly; Rise in Bad Home Loans;Record Low Property Transactions http://globaleconomicanalysis.blogspot.com/2011/05/economic-bust-in-australianear-record.html Australian Employment Unexpectedly Falls Most Since 2009, Currency Weakens http://www.bloomberg.com/news/2011-...y-falls-most-since-2009-currency-weakens.html
We just sold a family property in Melbourne at auction 3 weeks ago. There were 8 bidders and the house sold for $250,000 over the reserve. This is even more surprising when you consider the house needed a new kitchen and bathroom to replace the original 1950's ones. There are plenty of exceptions to the rule. Runningbear
Yes as you have said your one data point is not a good indication of the housing market in the entire country. (I would have said this if the house had been discounted by $250,000 after renovations). However from what I recall, the latest RP Data Riskmark Home Value index http://www.rpdata.net.au/ shows that Sydney was the best performing city with a gain of only 2.1%. Meanwhile the two commodity boom cities, Brisbane and Perth, saw declines of over 6%. So at the very least, in the last 12 months, a government guaranteed bank deposit earning over 5.5% has outperformed housing in all Aussie capital cities. And in the case of Perth and Brisbane, the outperformance was by over 10%. Even if property prices don't "crash" (I'll use an arbitrary figure of 20% decline from peak), I believe that prices will be flat at best in the next few years.
Web sites showing house price data RP Data http://www.rpdata.net.au/ ABS http://www.abs.gov.au/ausstats/abs@.nsf/mf/6416.0 * Perth and Brisbane down by over 3% in the 12 months to 31 March; * Canberra best performing up by 1.1%
m22au. We sold for a reason. We're now in cash earning 6.25%. But if interest rates go up another .5% which is likely, our return will be closer to 7%. Unlike a house, cash deposits don't have maintenance costs either. We won't be re-entering the market until we get a big correction. Runningbear