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  • #98,761
  • Aug 25, 2016 12:40am Aug 25, 2016 12:40am
Quoting PaulDaemon
{quote} How do you make money if there is no volatility
Quoting cold chisel
{quote} We wait, until it returns.
Is the correct answer.
  • #98,762
  • Aug 25, 2016 1:40am Aug 25, 2016 1:40am
Quoting cold chisel
{quote} It wasn't the housing bubble that crashed their economy. Raising rates by stupid mr. Greenspan crashed the economy.
How on earth do you separate the two.
raising rates burst the bubble...
Come with me if you want to live....
  • #98,763
  • Aug 25, 2016 1:48am Aug 25, 2016 1:48am
Quoting cold chisel
{quote} Property investment is a lousy investment NOW. It used to be good 10 and 20 years ago. But not now. The entry level is very high in Australia. I like your sentence when you say that you double your money (minus expediences) Expenses might be higher than your profit of 10%. I still renovate my local property after the f...ing tenants and insurance that didn't even cover 50% of the damage. Property investment is good in the US now (where yields are 10%+ and here they are 4%).
Expenses may well be higher than YOUR profits, but that doesn't make property a bad investment when viewed on a greater scale than one example.

Let's take another example.

Our property has increased in value by nearly 50% in the last 5 years. Even after forking out $10,000 for concrete cancer in our block and another $8,500 for restoration of common area stairwells and tiling the balcony, we are up over $180,000.

That's ok...
Come with me if you want to live....
  • #98,764
  • Aug 25, 2016 1:53am Aug 25, 2016 1:53am
Quoting cold chisel
{quote} It wasn't the housing bubble that crashed their economy. Raising rates by stupid mr. Greenspan crashed the economy.
May we we are on different pages but I really don't follow you here.

This more or less is my memory of what happened

http://www.canstar.com.au/home-loans...ancial-crisis/
Come with me if you want to live....
  • #98,765
  • Aug 25, 2016 2:11am Aug 25, 2016 2:11am
Quoting cold chisel
{quote} (where yields are 10%+ and here they are 4%).
Ok, I see what you mean, I think we are looking at different things here.
As long as the rent covers all or nearly all the mortgage, I would be happy with that. Since I am borrowing money to buy investment property, the main profit driver I see is the increase in value. Any rental yield over and above my monthly mortgage repayment is not likely to be significant as a motive for my investment as it would be very small. I would only consider yield if I bought the property outright.
Come with me if you want to live....
  • #98,766
  • Aug 25, 2016 2:22am Aug 25, 2016 2:22am
Quoting Ill-b-back
{quote} May we we are on different pages but I really don't follow you here. This more or less is my memory of what happened http://www.canstar.com.au/home-loans...ancial-crisis/
When interest rates went up after the "honeymoon period" those sub-prime mortgagor's couldn't afford the repayments and defaulted, which created the bubble. Over supply and zero demand. I dont see that kind of problem happening here but just the housing boom cycle coming to an end. Those who need to sell will sell at a loss.

Im with Cold chisel on this investing into property is one big scam made by financial advisors and working in cahoots with the government to get stamp duty and other taxes. You think you made $180,000? If you sold your house now how much will cost to buy another one only good if you want to down grade and invest the profits else where. . Investing in property is only keeping your money equal to the rate of inflation, which is not a bad thing of course.
20 Pips a day keeps centerlink away
  • #98,767
  • Edited 3:14am Aug 25, 2016 2:56am | Edited 3:14am
Quoting PaulDaemon
{quote} When interest rates went up after the "honeymoon period" those sub-prime mortgagor's couldn't afford the repayments and defaulted, which created the bubble. Over supply and zero demand. I dont see that kind of problem happening here but just the housing boom cycle coming to an end. Those who need to sell will sell at a loss. I'm with Cold chisel on this investing into property is one big scam made by financial advisors and working in cahoots with the government to get stamp duty and other taxes. You think you made $180,000? If you sold your...
You are right, the property I am referring to is my own home and the profit, or at least a good portion of it, would need to be put into another place if I want to upgrade. But this principle does not apply to an investment property.

I sell, I keep...
Come with me if you want to live....
  • #98,768
  • Edited 3:35am Aug 25, 2016 3:10am | Edited 3:35am
Quoting PaulDaemon
{quote} When interest rates went up after the "honeymoon period" those sub-prime mortgagor's couldn't afford the repayments and defaulted, which created the bubble. Over supply and zero demand. I dont see that kind of problem happening here but just the housing boom cycle coming to an end. Those who need to sell will sell at a loss. Im with Cold chisel on this investing into property is one big scam made by financial advisors and working in cahoots with the government to get stamp duty and other taxes. You think you made $180,000? If you sold your...
The bubble wasn't created by rising interest rates, the bubble BURST due to rising interest rates which was the point I was making in my previous post 98,766. Rising interest rates don't create bubbles, low interest rates do, along with poor or non existent regulation and in the most recent case in America, a dumb ass called Bush who helped fuelled it all by helping to finance (with Tax payers dollars) "the great American dream of owning your own home" for those who couldn't afford it. This creates BUBBLES. All the while having his strings pulled by Wall street who made a killing selling stoopid property packages while the resulting boom lasted.
Inserted Video


The prick could even bring himself to say "using Tax payers money", instead opting out at "Tac payers money". It's like he knew the word was known to be too dirty to actually be said.

I f#*&king love at around the 2.15 mark, he talks about "streamlining" the process of taking out a mortgage, adjusting the FINE print, making it simpler. Yes folks, simpler, so simple in fact that a homeless beggar on the street could have a home loan...

I don't see it happening here either, in fact the housing market cycle in Australia tends to just dip a bit, plateau, then keep rising.
Come with me if you want to live....
  • #98,769
  • Aug 25, 2016 4:07am Aug 25, 2016 4:07am
Yeah,yeah. But somehow you can buy a decent house in US state of Texas for 200k and what can you buy here for 200k? A dog house in Sydney?
  • #98,770
  • Aug 25, 2016 4:27am Aug 25, 2016 4:27am
Quoting cold chisel
Yeah,yeah. But somehow you can buy a decent house in US state of Texas for 200k and what can you buy here for 200k? A dog house in Sydney?
What is your point and how does it relate to investment returns from property?

Sounds to me like Sydney housing price frustration is your issue here, which is the exact point I made in my initial post about Stevens' cutting interest rates.
Come with me if you want to live....
  • #98,771
  • Aug 25, 2016 6:04am Aug 25, 2016 6:04am
Quoting Ill-b-back
{quote} The bubble wasn't created by rising interest rates, the bubble BURST due to rising interest rates which was the point I was making in my previous post 98,766. Rising interest rates don't create bubbles, low interest rates do, along with poor or non existent regulation and in the most recent case in America, a dumb ass called Bush who helped fuelled it all by helping to finance (with Tax payers dollars) "the great American dream of owning your own home" for those who couldn't afford it. This creates BUBBLES. All the while having his strings...
i think It was a boom made to go bust. There is a good movie about it called "capitalism a love story"
20 Pips a day keeps centerlink away
  • #98,772
  • Aug 25, 2016 6:57am Aug 25, 2016 6:57am
Quoting PaulDaemon
{quote} i think It was a boom made to go bust. There is a good movie about it called "capitalism a love story"
I've seen what maybe a similar documentary entitled "Inside Job".

Inserted Video
Come with me if you want to live....
  • #98,773
  • Aug 25, 2016 7:55am Aug 25, 2016 7:55am
Quoting Ill-b-back
{quote} What is your point and how does it relate to investment returns from property? Sounds to me like Sydney housing price frustration is your issue here, which is the exact point I made in my initial post about Stevens' cutting interest rates.
I don't care about Sydney house prices, because I never lived there and not planning to.
The bubbles in real estate are fueled by cheap mortgage rates and nothing else. If there was no CHEAP credit there wouldn't be a bubble. People wouldn't buy if they had NO money. So instead of pouring cheap money into real economy that creates something (manufacturing, agriculture, science, infrastructure) the money is floating into residential real estate section which creates NOTHING except some profit for greedy property investors. We will see what will happen to them when rates will start to rise. O, I forgot we are already seeing this in some mining towns, where prices collapsed some 50-70% and at some extent Perth, where vacancy rates is up to 6% and rents fell 30-40%. Now that is starting to hurt. And this is just the start.
I'm a property investor myself for more than 25 years. But I'm against cheap credit, because I don't use it. I only buy in cash, and the latest surge in property prices is slowly shaking me out of Australian real estate. Well, I'll sell here and buy in the States and already doing that. I wonder which economy will win.
So Bush can be a moron, but he knew how to keep the real estate prices down and the local guys like Stevens - don't.
  • #98,774
  • Aug 25, 2016 8:00am Aug 25, 2016 8:00am
Quoting Ill-b-back
{quote} May we we are on different pages but I really don't follow you here. This more or less is my memory of what happened http://www.canstar.com.au/home-loans...ancial-crisis/
This gentleman lowered the rates and then relatively sharply raised them. That crashed the economy, he should have raised them slower, like they are doing it now(or not doing it now) - because they are afraid (Yellen) to repeat mistakes made by that old hag.
  • #98,775
  • Edited 9:13am Aug 25, 2016 8:53am | Edited 9:13am
Quoting cold chisel
{quote} I don't care about Sydney house prices, because I never lived there and not planning to. The bubbles in real estate are fueled by cheap mortgage rates and nothing else. If there was no CHEAP credit there wouldn't be a bubble. People wouldn't buy if they had NO money. So instead of pouring cheap money into real economy that creates something (manufacturing, agriculture, science, infrastructure) the money is floating into residential real estate section which creates NOTHING except some profit for greedy property investors. We will see what...
I have no idea why you are posting this to me. I agree pretty much with everything you say and I think my posts relate that. Of course cheap credit creates bubbles, I've said that numerous times just on this thread page. I've also pointed out that over borrowing at cheap rates leaves a home loan recipient vulnerable when rates rise. (using my own experience if we had decided to take the $740,000 loan).
With regards to housing bubbles in the US, I was a bit confused when you said they don't experience bubbles when the sub prime property market produced just such a bubble that imploded when rates rose sharply as you pointed out above. The roughly 18 year property cycle in the states is what I was referring to when I said they have plenty of bubbles (my bad on incorrect interpretation there).
I stated with good reason in one of my earlier posts that due diligence is required for successful property investment. If your research points to a nearby down turn in mining then don't invest in mining towns. If your research tells you Sydney prices are peaking and are going to drop, then wait or look elsewhere as you are doing... this would be common sense. YOUR due diligence has you looking elsewhere to invest. That's GREAT and is just the type of diligence I was talking about earlier to be a successful investor. I've already said prices in Sydney are sky high and new home owners will need parents help and Stevens IR policy is not helping. I have no favouritism between here or the US and don't know what gave you the idea I did. However, I never liked Bush, I think he was the perfect candidate to be manipulated. My point was, property investing if done with diligence can be a very good investment (whether in Sydney, Melbourne, US or Shanghai, it doesn't matter), primarily due to it's leveraged nature of only putting down 10% but getting the full upside at the point of sale. My only reference to Sydney was my own home as an example of one that has grown in value nicely.
Come with me if you want to live....
  • #98,776
  • Aug 25, 2016 9:21am Aug 25, 2016 9:21am
Quoting cold chisel
{quote} This gentleman lowered the rates and then relatively sharply raised them. That crashed the economy, he should have raised them slower, like they are doing it now(or not doing it now) - because they are afraid (Yellen) to repeat mistakes made by that old hag.
Ok, I was a bit confused but now I understand our disagreement on this point. When I said the housing bubble crashed the economy, I meant when the bubble burst (as a result of interest rate rise you pointed out). I incorrectly presumed people would make the link. Both the info and video I attached earlier relate to this.
Come with me if you want to live....
  • #98,777
  • Aug 25, 2016 6:28pm Aug 25, 2016 6:28pm
[quote=Ill-b-back;9101933]{quote} I have no idea why you are posting this to me.

Because you say that property investing is one of the best investments around. I say it is NOT, at least here in Australia.
The situation in Perth helps to see the future of real estate.
  • #98,778
  • Aug 25, 2016 7:42pm Aug 25, 2016 7:42pm
In the mean time we have a significant change in the short term downtrend on the 4HR chart. The last two lows have been higher lows. If the current little run extends above 76.4, we will also have a higher high.
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  • #98,779
  • Aug 25, 2016 7:49pm Aug 25, 2016 7:49pm
Quoting Blackopal
In the mean time we have a significant change in the short term downtrend on the 4HR chart. The last two lows have been higher lows. If the current little run extends above 76.4, we will also have a higher high. {image}
Needs to fall through 200ma
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20 Pips a day keeps centerlink away
  • #98,780
  • Aug 25, 2016 7:50pm Aug 25, 2016 7:50pm
Quoting Blackopal
In the mean time we have a significant change in the short term downtrend on the 4HR chart. The last two lows have been higher lows. If the current little run extends above 76.4, we will also have a higher high. {image}
The current upward movement coincides with a short term dip on USD Basket as shown on 1HR chart, and a slight rise so far today on iron ore. Both possibly short lived, Yellen's speech later the near term determinate factor to PA.
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