lots of good comments here from the usual conservative types, with a good understanding of investing......... and the media today........fairfax newspapers............House prices head south, north and east........eg of Bondi,,,,,,,,,,,,only up 12.6% over past 4 years, now down 1.6%.........so its still up 11%.............more expensive Palm Beach is down 5.6%, but up 62% past 4 years, = net up 56%........... of course there are lots of props in western suburbs way down, probably 50% to their highs............most were housing commission or similar low level type.........were worth only 120,000-150,000 at the height of the boom............but were selling for that magical 300,000 figure (magical because some say thats what first home buyers can afford) I know of a few people who bought prop at the height of the boom, only because they thought they should, and everyone else was doing it,,,,,,,most sold within a year, because they could not handle the emotions and responsibility that went with prop investment, they were then happy to leave money in the bank on deposits. And I have had 3 agents recently give me 3 very different valuations on one property........from 230000, 270000, 300000..........and all 3 suggest the rental value is either 230. 270, 300 pw..........friends and associates who are into real estate suggest the prop was worth 330,000 last year.......all 3 agents still use the magical 300,000 figure for first home buyers....but the house is in inner city (big regional city) only 4 years old, calafornia bungalow style, huge entertaining/living areas, 9 ft ceilings , polished boards, airco, etc and short walk to entertainment, main street, cafes etc ..........the entertainment area, main street, is the main hub in a 200klm radius of the area.............. anyway I will not be selling...........like a very big property developer, who bought up a lot of schools the kennett govt was selling in the 1990, he got them all very cheap to do resi develpment on...........just took it all off the market, it was not for sale at a low price,,,,,,,,,,,,,he used figures like buy for 500,000 and sell for 5 million within 10 years............ like the stock market, realestate will have problems, just like any other investment...........banks which provide most of the financing, will be cutting their own throats, by withholding credit, and charging very high interest rates,,,,,,,,,,,,thats where they make their money.........so we can expect them to lose money now......... maybe we need some 'harbinger types' for the property market.....ie they lent twiggy forrest 50 million for POS, 3 years interest free, then 3 years at 5% !!!! PS when the market recovers and property gains a modest 10% pa, that little house will be worth over 430,000..... in the meantime I will twiddle my thumbs, give the bank more money to reduce the interest expense, and wait it out cheers
