re: massive property dha (defence)
You know, the psychology of these discussions is always interesting too.
If you look at HC posters they will buy some shares and talk it up. It's going to rise because of this and this and that.
If they missed out on a big riser then they hang it on the share. It's badly managed, there's no substance to this, it's unsustainable, this is going to dive yaddah yaddah yaddah.
Pete (christopheskase) took a punt a few years ago. He was pretty certain that the rises in property were unsustainable and there absolutley had to be a fall on the horizon.
So he sold the family home and he was wrong. Boy was he wrong. After the agency fees, the price rises and the stamp duties (to get back in) he just couldn't afford to buy his own house so he rents.
Now what to do? Admit his mistake? No of course not, you can't do that. Better to go on and on and on about how we will see a 50% fall in property rises.
Never mind that it would be unprecented after hundreds and hundreds of years, never mind the fact that 70% of homes are owner-occupied, never mind that it is not a fluid investment like shares (you can't sell the back steps, you sell it all or nothing). Never mind all that, according to this giant of the investment world it's just around the corner, you just wait and see.
Now all the others are jumping on board. How much do you want a bet that amongst these posts there are sour grapes, wishful thinking and good old fashioned down ramping (for what good it does in HC).
The fact is that we are in a flat period that is likely to last a number of years. After that we will see healthy rises just as we always have done.
Pete mentioned Melbourne because he hopes like hell that Frankston will dive so he can buy back in. Let me tell you about Melbourne.
For the first time ever Melbourne is getting the lion's share of immigration, coupled with that is the Urban Growth Boundary (read this as restriction of supply). You have rising demand with limiting of supply, which way will this go ... duhhh.
The move up North is happening as is the move to Vic and NSW coastal areas. This is a factor but what % of Melbourne's population is this? Not much.
So if you want to wait for those 50% falls you just go ahead and wait.
Me, I'll keep an eye on the vacancy rates and when the ROI is competitive once again I'll go ahead a pick up some well placed rentals. My guess is late 2006, early 2007 in anticipation of healthy rises starting late in 2007 going through to 2010.
There's only shares, cash and property. All investments fit under one of these three categories. Why would you exclude any of them from your bag of tricks?
