re: rates up. but rates still too low. rabbitoh
There is currently a big meeting happening in canberra on housing affordability run by the government. Mortgage defaultees in melbourne alone have doubled in the last 12 months...today rate rise will cause more to default. The rate rise is not about bananas, its about rising oil price and the flow on effects being passed down. There has also been big problems with skilled shortages, one people demand more $$ to pay for higher mortgage repayments and fuel in car etc this will push inflation higher again. Inflation has also been rising in a number of other areas. If you beleive the oil price will fall then you may have a chance of rates falling. Our trade balance is getting worse and worse. I definately see another rate rise very soon, the bond market has had its rates at around 6.37...this means they expect a rate rise of 0.25 + half that again over the next 3 months.
It was the oil price spike of the early 70's and 80's that resulted in massive inflation and rate rises...today will be the same. Unfortuntaely inflation often chases its tail.
A recession will not be far off but by then my guess is rates will be quite higher and property prices substantially lower and unemployment higher aswell.
I would not like to be deep in property right now, the pain is yet to begin.
this boom is similar to that of Japans in the 80's...their property pric`es are still 30% below what they peaked at then...and japan had a good reason for booming property (land shortage). WA is using this excuse for rising property prices...you must be kidding
Buy property when nobody else wants to ...it is a contrarions commodity not a traders
