property market next to crack, page-10

Damien83

I was involved in the last Oz property crash about 1989.
The market was screaming up but so were the interest rates and that's what killed it, when they hit about 17%.

WA, Scarborough all 1/4 acre with home, first 2 R40 zoning, last one R20.
Bought in 1986 for $60,000
Sold in 1987 for $90,000 and bought again down the road for $80,000
Sold shortly after for $90,000 and bought nearby corner block R20 for $90,000.
Subdivided into 2 green title 500sqm blocks and sold the front one in 1988 for $92,000 with the 1 bed home on it.
Rear block had street frontage was offered $90,000 by a passing agent[if only I had taken that!] but built a 4x2 2 story home instead.
Builder went broke[stock market peaking, brickies charging $1 a brick]
House almost finished in 1989 and valued at $230,000
Real estate goes very quiet and I follow the market down to sell after 3 months for $170,000 and pay back my family the money I borrowed to cover the 17% interest rates.
After that prices were stagnant for several years before slowly starting to rise again.

Hopefully that paints the picture.
The difference this time is that it hasn't tanked in WA, rather it's just gone very flat and that must be because the interest rates are not high enough to wipe the market out.
It has to be close to 2 years since the market hysteria stopped and it might just carry on this way unless interest rates go up. I doubt that will happen at this stage of the game.