Following on from the HC thread on the
'money value of time', I thought I would share this because I think it is important to use historical/real data when talking about house prices.
The firms '
Clarke McEwan' and '
Stanford Brown' did an analysis of AUS house price movements over 120-ish years (This is important because you need to use long term data to truly understand the housing market).
The main conclusions were in their commentary as below:
* "We have had five periods since 1900 when real house prices have not risen for a decade or more."
* "There are regular price falls of 10% to 15% or so but no major broad-based collapses like in the US and many other countries."
* "We easily forget that as recently as the seven years from 2004 to 2011, there was no real growth in house prices following a surge from 1996 to 2004."
As the historical data shows, owning property/real-estate in Australia is definitely
no guarantee of "Financial Security". In fact (as you will see in the graph), if you were an Aus property investor between 1929 to 1950, you would most likely have been
sitting underwater with your property investment
for 21 years.
And I thought I would begin this discussion with the other thread on the '
money value of time' to highlight the fact that if the value of real estate/property is going sideways over time, then the owner is
effectively losing money.[]
