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#2041 | |||
FF.Com.Au Hardcore
Join Date: Sep 2005
Location: Ivory Tower
Posts: 5,414
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Financial literacy amongst the population is low. Very low. I read a home owner with a $1.5m property who's value had dropped $200k asking if their loan also dropped $200k. Why don't people understand their loans are full recourse? Folks like Martin North and Tony Locantro have been predicting property values coming down since the pandemic started. They've been wrong for nearly 2.5 years, but their being wrong is about to become right.
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#2042 | ||
FF.Com.Au Hardcore
Join Date: Jul 2005
Location: Melbourne
Posts: 6,891
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Tony Locantro...now that's a name I haven't heard for a while. One worth following. Made a mate of mine very rich at a very young age getting him on IGO, and retired as a 30 something year old.
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~~~~~~~~~~~~~~ Rides (past and present) Current: 2004 Ford Falcon 5.4L 3v Barra 220, Manual Past: Mitsubishi Sigma (m), Toyota Seca (m), Toyota Seca SX (m), Toyota Vienta V6 (m), Toyota Soarer 4L v8 (a), BA XR8 ute (m), T3 TE50 (m), BMW Z4 (m) AFF motto - If contrary views trigger, please use ignore button. ![]() |
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#2043 | ||
FF.Com.Au Hardcore
Join Date: Sep 2005
Location: Ivory Tower
Posts: 5,414
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My share portfolio has dropped 40% over the last 12 months (on paper only, I've not sold and continue to hold any buy more) - that seems to be an acceptable risk level to those I speak to with mortgages and those who don't invest in the markets. Mention increased interest rates and reduced property values and people have a coronary. The perception is house prices can only go in one direction - up. People are about to get a healthy dose of reality.
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#2044 | |||
FF.Com.Au Hardcore
Join Date: Sep 2005
Location: Ivory Tower
Posts: 5,414
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Quote:
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#2045 | |||
BLUE OVAL INC.
Join Date: Feb 2006
Posts: 8,645
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Quote:
Our Daughter and us both have LVR's of 90% but as the actual loans are small, a 3% rate rise is quite manageable. She is single and can afford it on her own, she also has a spare room with ensuite that she can rent to a friend if she wants to free up money at any stage. |
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#2046 | |||
BANNED
Join Date: Jul 2012
Posts: 2,886
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Quote:
LOL...nah...he gave up waiting for property prices in Perth to tank. In one of his videos he admits to paying too much but shrugs his shoulders and says he ha the money to buy now and life is not a dress rehaearsal, its the one and only live show. Gotta love the guy.
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#2047 | ||
Regular Member
Join Date: Jan 2006
Location: Melbourne
Posts: 176
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Have noticed that the market has started to slow where I am (eastern suburbs Melbourne). A house in my street went for auction on the weekend, no bids. Nice house, but there were some issues such as no garage & only a small living area despite having 6 bedrooms. Agent also said that Chinese buyers were turned off as it had bad Feng Shui as it was on a T-intersection. Word is that some homes are still getting strong prices, but at $1 million plus, people are starting to get picky, and are bypassing places missing things such as garages, or where they will have to spend substantial money to get the place to how they want it. No longer a FOMO market.
With the Japanese situation, totally different demographics from here as mentioned. There is a rapidly ageing population, their country towns are full of abandoned homes. Migration isn't at the levels it is here, although the Government there has started to allow guest workers to come in. As anyone who's been there will know, a lot of the staff at places such as Starbucks & KFC are Filipino, and I've seen people from the sub-continent working at a Family Mart. The 'guest worker' program also isn't a pathway to permament migration that it is here. Most of the 'western' Japanese travel Youtubers have married locals, which has allowed them to remain there. |
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#2048 | |||
FF.Com.Au Hardcore
Join Date: Jul 2005
Location: Melbourne
Posts: 6,891
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Another 50 basis point just announced. Can anyone with an economic background explain how lifting rates is going to help with this current inflation?
The big contributors are petrol, gas and electricity, and food prices, we are told these are all due to overseas events, so how is removing cash from mums and dads going to help? ![]() Quote:
![]() Are chinese buyers still buying the ~$1m residential properties? Thought data showed that investments from the Chinese had fallen off a cliff. You still hear about them from time to time because there is the odd $20m+ type purchases, but that won't affect your every day buyers.
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~~~~~~~~~~~~~~ Rides (past and present) Current: 2004 Ford Falcon 5.4L 3v Barra 220, Manual Past: Mitsubishi Sigma (m), Toyota Seca (m), Toyota Seca SX (m), Toyota Vienta V6 (m), Toyota Soarer 4L v8 (a), BA XR8 ute (m), T3 TE50 (m), BMW Z4 (m) AFF motto - If contrary views trigger, please use ignore button. ![]() |
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#2049 | |||
Regular Member
Join Date: Jan 2006
Location: Melbourne
Posts: 176
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#2050 | |||
BLUE OVAL INC.
Join Date: Feb 2006
Posts: 8,645
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Quote:
The first 2 rate rises did nothing to curb spending, people are throwing cash around without a worry in the world. There is a real denial of where things are headed for many as pulling in inflation is a foreign concept when you've spent a decade doing the opposite on cheap credit. |
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#2051 | ||
DIY Tragic
Join Date: Apr 2018
Location: Sydney, more than not. I hate it.
Posts: 21,836
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I’ve not noticed much restraint in spending either. Maybe shorter queues at the petrol station and people putting in less than a full tank.
Secondhand building materials are apparently gold-plated now, if you look at asking prices for rubbish online. $600 for a secondhand aluminium standard sliding+fixed door set? ![]() I wonder if people will countenance shared housing as a different proposal to the usual assumptions of undergraduate squalor? |
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#2052 | |||
FF.Com.Au Hardcore
Join Date: Sep 2014
Location: Catland
Posts: 3,618
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Quote:
If they get too far behind, AUD gets hammered. If AUD gets hammered, everything we import adds to the inflation shock: think especially, fuels and oils. So we have to raise, relatively speaking.
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I6 + AWD |
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#2053 | |||
BANNED
Join Date: Jul 2012
Posts: 2,886
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Quote:
but their downturn started before they had an ageing population and abandoned homes and has not recovered, because prices were sky high when the rot set in.
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#2054 | |||
FF.Com.Au Hardcore
Join Date: Jul 2005
Location: Melbourne
Posts: 6,891
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Quote:
The top 3 increases have been food, transport and education. A close fourth is housing, followed by health. Clothing and footwear went backwards, so you could argue the rate rises might be starting to have some impact. (EDIT: just realised its March qtr data, so before rate rise) Which of the top 5 will raising interest rates help bring down? Housing obvious....but others are all essentials, cutting health and education will just create more problems down the track. We are told food and transport is outside of our control.
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~~~~~~~~~~~~~~ Rides (past and present) Current: 2004 Ford Falcon 5.4L 3v Barra 220, Manual Past: Mitsubishi Sigma (m), Toyota Seca (m), Toyota Seca SX (m), Toyota Vienta V6 (m), Toyota Soarer 4L v8 (a), BA XR8 ute (m), T3 TE50 (m), BMW Z4 (m) AFF motto - If contrary views trigger, please use ignore button. ![]() Last edited by T3rminator; 06-07-2022 at 12:20 PM. |
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#2055 | ||
FF.Com.Au Hardcore
Join Date: Apr 2005
Location: Canberra
Posts: 13,374
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It looks like another 0.5 whack coming in August is likely.
My mum is trying to offload her investment property so she can sell her house and downsize but it has just been a **** show so far but hopefully soon ![]() |
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#2056 | ||
BANNED
Join Date: Jul 2012
Posts: 2,886
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Some are predicting 0.75 rise...
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#2057 | ||
FF.Com.Au Hardcore
Join Date: Apr 2005
Location: Canberra
Posts: 13,374
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#2058 | ||
FF.Com.Au Hardcore
Join Date: Sep 2005
Location: Ivory Tower
Posts: 5,414
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I remember interest rates between 6-7% around 2009-2015. No big deal. The RBA should just increase rates 1% in August and 1% in September to bring rates back to their normal level.
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#2059 | |||
Regular Member
Join Date: Jan 2014
Posts: 372
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Quote:
Like to see members opinion re. a manufacturing led recovery, particularly for consumables and single use stuff. Maybe just a dream and not possible with our FREE trade agreements and relatively small domestic market. |
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#2060 | |||
Where to next??
Join Date: Oct 2006
Location: Sydney
Posts: 8,893
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Quote:
I'm thinking it will be between .3 and .5% . 75 basis points seems too much of a kick in the guts in 1 hit. Having said that, banks are jacking up their fixed rates well above the predictions so anything is possible. In 18 - 24 months there will be billions of $ in loans coming out of sub 2.5% fixed rates. These people will be going to around 5-6% overnight.. Now that will be an interesting situation to observe.... Sent from my SM-G973F using Tapatalk
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___________________________ I've been around the world a couple of times or maybe more....... |
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#2061 | |||
Virtuous Bogan (TM)
![]() Join Date: Jan 2005
Location: TAS
Posts: 27,559
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IMO, I wouldn't spend a cent on the large cities anymore, we need people out of them or stop having it so we "have" to go to them. They are now big enough to look after themselves. Private housing should not be touched by GovCo...ever, seems there has been a lull in public housing that that should be the focus as more people "fee the pinch. And that doesnt mean ghetto's.
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#2062 | ||
Ford screwed the Falcon
Join Date: Sep 2013
Posts: 7,059
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The RBA are clueless
They created this asset bubble by flooding the market with cheap credit since 2009 Now they are about to pop the same asset bubble. This is going to hurt................
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Falcon: 1960 - 2016 My cars Current ride 2016 FG X XR6 - 6 speed manual Previous rides 2009 FG XR6 - 6 speed auto 2006 BF MkII XT ESP - 6 speed auto 2003 BA XT V8 - 5 speed manual 1999 AU Forte - 5 speed manual 1997 EL Fairmont - 4 speed auto 1990 EAII Fairmont Ghia - 4 speed auto |
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#2063 | |||
FF.Com.Au Hardcore
Join Date: Sep 2005
Location: Ivory Tower
Posts: 5,414
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Quote:
As mentioned by Yellow Fiesta interesting times ahead with those on sub 2% fixed and variable rate loans entering the market at what will be a 10 year cash rate high according to 3 of the 4 major banks.
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2021 BMW M550i in Black Sapphire Metallic.
11.52 @ 120mph stock Last edited by Romulus; 24-07-2022 at 04:30 PM. |
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#2064 | ||
Bolt Nerd
![]() Join Date: Jan 2005
Location: Ojochal, Costa Rica (Pura Vida!)
Posts: 14,616
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The homes that are being passed in, or VB ( in Melbourne) appear to be the 1mill-2mill.
Lower valued homes (500-800k) are retaining or actually rising… And selling like hotcakes. I’d suggest those heavily financed in the plus 1mill bracket are panicking and looking to cut and run and buy smaller?… So, again the first home buyers the losers?
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Current vehicles.. Yamaha Rhino UTV, SWB 4L TJ Jeep, and boring Lhd RAV4 Bionic BF F6... UPDATE: Replaced by Shiro White 370z 7A Roadster. SOLD Workhack: FG Silhouette XR50 Turbo ute (11.63@127.44mph) SOLD 2 wheels.. 2015 103ci HD Wideglide.. SOLD SOLD THE LOT, Voted with our feet and relocated to COSTA RICA for some Pura Vida! (Ex Blood Orange #023 FPV Pursuit owner ![]() |
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#2065 | ||
DIY Tragic
Join Date: Apr 2018
Location: Sydney, more than not. I hate it.
Posts: 21,836
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Sounds plausible. Especially the panicking - get an impression there’s a lot of emotion getting ahead of analysis in the minds of people affected by the rate rises.
Will families start having a lodger, to make up the difference in repayments? What about companies offering to contract for a space in your yard to stand a relocatable dwelling? At the moment everyone seems determined to suffer as nuclear families, rather than embraced shared costs. |
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#2066 | ||
BANNED
Join Date: Jul 2012
Posts: 2,886
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The best part will be the smug young tradies who have never experienced a downturn,
You know the ones....brand new HiLux or Ranger..permed hair and blue heeler in the tray...reckon they are worth a thousand bucks a day. Bring it on I say...
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#2067 | ||
BLUE OVAL INC.
Join Date: Feb 2006
Posts: 8,645
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With rentals in huge demand and rent soaring there will still be plenty of activity in the entry level buyers market as its now cheaper to pay a mortgage even with a LVR above 90% than rent the equivalent property.
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#2068 | |||
Donating Member
![]() Join Date: Jun 2007
Location: Checking out soft furnishings....
Posts: 8,682
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Quote:
I don't think the rise in rent will see more people buy. Most the people renting can't get a loan to buy a house, hence why they are renting. Even with a sizeable deposit, you wont get a loan easily, even if your rent is more per week, that doesnt even come into the banks decision to approve or not.
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Proud owner of the ugliest Ford ever made |
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#2069 | |||
Former BTIKD
![]() Join Date: Mar 2005
Location: Sunny Downtown Wagga Wagga. NSW.
Posts: 53,197
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Quote:
![]() Do the agents charge a flat fee for looking after it or is it a percentage of the rent?
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Dying at your job is natures way of saying that you're in the wrong line of work.
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#2070 | |||
Donating Member
![]() Join Date: Jun 2007
Location: Checking out soft furnishings....
Posts: 8,682
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Quote:
I looked at rent in that area and I could have easily got more, im happy though. Remember this is all business mate, you don't make friends in business. Agents are there to make money, not help people, it's just reality.
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Proud owner of the ugliest Ford ever made Last edited by fordomatic; 25-07-2022 at 02:23 PM. |
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