Can anyone say that capital gains of the past will likely be matched by gains in the next 5 years?
If "no" is the answer, is there any reason to invest in property?
Without likely capital gains at current prices, is it likely to make a profit after tax, maintenance, bank interest, opportunity cost, insurance, agent fees, rates, body corporate fees?
If "no" is the answer will prices fall?
End of Yes no answers.
Without capital gains, how much will prices have to fall before property investment is attractive?
In my opinion, if no is the answer to all the above, the only way I would invest in property in the current environment is if it fell low enough for me to get immediate positive gearing of some sort. It doesn't need to meet a bank deposit rate, but it I definitely won't invest if it will cost me an immediate and continuous loss of capital from the minute I sign on the dotted line for a decade or more.
