澳洲Australia property What if Aust prop went the US way? | Sydn


在澳大利亚 I need some advice regarding a property purchase. Property - semi-detached house Bedrooms - 2 Condition - average needs internal reno to modernise Street - one of the best in suburb Location - excellent Close to schools - yes Transport - 50m The pool at of an IP needs to be resurfaced (or so the pool doctor says), the cost was estimated to be $10K ($10,000), after recoverying from my impresssion of a cat coughing up a fur ball, it just seems far too much. Its just a standard poo


What would all you investors do if Aust prop prices went the US way. A number of articles seem to suggest that we should be prepared for a big fall.


What would happen to your portfolio?  

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sorry I forgot to say I am new here but totally addicted to the forum. Great ideas from all you investors.  

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Ginger said: ↑
What would all you investors do if Aust prop prices went the US way. A number of articles seem to suggest that we should be prepared for a big fall.


What would happen to your portfolio?Click to expand...
A number of articles. Really? OMG - How many? HOW MANY???  

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It depends when it happens. If it happens after I settle on my next property (which is due for completion in September/October) then I'd just continue to hold until values recover. If it happens before then I'm screwed!  

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move to thailand - live like a king!  

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Ginger said: ↑
What would all you investors do if Aust prop prices went the US way. A number of articles seem to suggest that we should be prepared for a big fall.


What would happen to your portfolio?Click to expand...
What would you do if your job went the American way, down the drain and unemployed?  

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I'd just hold the portfolio. It pays for itself anyway.  

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Well I wouldn't be happy for starters. I will not pretend that all is just supa dupa.
I will however survive and survive quite well due to minimum cash-flow issues.
I will just sit on my properties and be thankful that I have 30 plus years of working life in me to recover.
Oh and I would continue to enjoy life as I do now. Fishing,camping,bikes,cars, kids.
Plenty to keep busy until things recovered.  

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Ginger said: ↑
What would happen to your portfolio?Click to expand...
It would grow from 0 to several properties :D  

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hobo-jo said: ↑
It would grow from 0 to several properties :DClick to expand...
I am willing to bet if that happened you'd be one of the first to say 'don't buy it's going to fall even further'.  

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Ginger said: ↑
What would all you investors do if Aust prop prices went the US way. A number of articles seem to suggest that we should be prepared for a big fall.


What would happen to your portfolio?Click to expand...
I wouldn't be happy but I'll be OK.  

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Aaron_C said: ↑
I am willing to bet if that happened you'd be one of the first to say 'don't buy it's going to fall even further'.Click to expand...
A 35% drop in nominal terms is pretty significant (Case-Shiller Home Price Indices fall). I don't think we'll get a chance to test your theory as I'm not expecting nominal prices in Australia to fall that far... I think I'll be buying before a fall of that magnitude. Guess we'll see :)  

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Ginger said: ↑
What would all you investors do if Aust prop prices went the US way. A number of articles seem to suggest that we should be prepared for a bigClick to expand...
what if...they didnt  

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Ginger said: ↑
What would all you investors do if Aust prop prices went the US way. A number of articles seem to suggest that we should be prepared for a big fall.


What would happen to your portfolio?Click to expand...

Which US states and suburbs? The places with 60% drops, or the ones with 10% drops.

We've already had big drops here in a few places, while others have had small drops, if any, but it's highly possible we will see some futher dropping in prices.

I have low LVR, secure employment, reasonable sized available funds, super that can be accessed as a lump sum in the not so distant future, so not overly concerned personally.

Have hedged a little with some gold and silver just in case as well :p.

I'd be more concerned with high unemployment and bankrupcies (business and personal), and mass foreclosures. A dropping market without those can bounce back much quicker, imo.  

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I'd agree with Weg that any housing crash is likely to be accompanied by a major recession. There would be knock on effects, such as banks being put under serious strain, a wrecking ball taken to (some) households' finances, negatively geared investors being wiped out (rents could fall along with prices), and the government's budget deficit rocketing.

The US, Ireland, Britain (also in the '90s) and Japan are all examples of housing markets dropping. None of them are or were fun places to be.

The other thing is that high prices make people feel wealthy. If the masses suddenly feel distinctly poorer then that's going to reduce discretionary spending somewhat.  

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Ginger said: ↑
What would all you investors do if Aust prop prices went the US way. A number of articles seem to suggest that we should be prepared for a big fall.


What would happen to your portfolio?Click to expand...
Ginger, let me be the first to welcome you to SS! ;)

Your question is a very contentious issue around here & you will quickly realize that it tends to be a polarizing subject. Rather than debate whether or not it will/can happen in Australia (which I note is not your question anyway...), perhaps a few comments assuming this scenario unfolds.

Firstly, leverage would be a big concern for those that are highly geared. Good cashflow would be a savior in these circumstances & it highlights the potential risk of high leverage and poor cashflow; something I have always considered and mitigated against anyway.

Secondly, I would see it as a potential purchasing window of opportunity. One man's downfall is another man's rise... unfortunate but often true. Depending on the lending environment, I would be seeking out "undervalued" properties that offer good cashflow as they should see reasonable longterm CG heading into the next cycle.

Lastly, investing is all about risk management of financial assets. We all have a different risk tolerance and you may infer through many OPs sarcasm, what their's is..... some of us can actually be civil in our first communication to new comers. ;) Welcome!  

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The housing market in the US is so different to here. I dont think its likely that Australia would down the same path. We have a lot more protections in place.

I think you have to be careful not to believe every article you read.... today you read doom and gloom... tomorrow, you'll read that the market is ready to head into a boom. Keep an eye on whats happening and make your own predictions.  

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Remember the interest has to drop as well.
For an interest rate of 2.5% .....wouldn't be that bad  

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We would probably all have to find another forum to while away our time on. This one would go pretty quiet. There would just be a couple of bears saying, 'Hah! I told you so. Guys? Hey, is anybody there? See, I was right. Hellooooo... Can anybody hear me?'  

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I wish the price of motor vehicles in Australia went the way of the USA  

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