Australian Real Estate: The Next Bubble ?

[Doodles]

Australian cruisers need to take notice:

Mish's Global Economic Trend Analysis: Global Housing Bubble - Based on Ratio of Price to Rent, Which Countries are the Bubbliest?

[Weyalan]

I scanned the article, and while there is truth to what he says, Australia's housing market is so diverse that I am not sure that it is possible to make such sweeping generalisations. Sure; there are areas of Australia where prices are ridiculously high (Sydney, in general, for example), but there are other areas where prices are still remamrkably low, as well.

[maxingout]

When we were on the Sunshine Coast of Australia in Mooloolaba, the market was segmented and volatile. Waterfront property shot up at an astonishing rate beyond the reach of most middle class people. Away from the waterfront, things were more reasonable, but prices were rising.

Most of the price rises seemed to be driven by speculation and big money coming from wealthy people purchasing/investing in homes along the Sunshine Coast.

[Doodles]

Originally Posted by maxingout

When we were on the Sunshine Coast of Australia in Mooloolaba, the market was segmented and volatile. Waterfront property shot up at an astonishing rate beyond the reach of most middle class people. Away from the waterfront, things were more reasonable, but prices were rising.

Most of the price rises seemed to be driven by speculation and big money coming from wealthy people purchasing/investing in homes along the Sunshine Coast.

Sounds like the typical scenario to me.

[shadow]

Yah, we lived in the Mooloolaba area as well as Noosa and then Sydney. They rated Sydney at one of the top if not THE top rated for most expensive in the world!!!! And I can actually vouch for that!! It is nuts and I've lived in London, New York and Paris and I couldn't believe the prices they were demanding for standard properties in Sydney...

All nuts if you ask me!!

[beau]

I am in Brisbane Australia and I have been predicting a major fall in property prices for years, but nothing has happened.

We have had an increase in prices since 1948, with a couple of small bumps along the way. However as most people were born after 1948 they think it will just go on forever.

Home prices throughout Australia are overpriced all over, not just in the big cities.
Homes are seen as an investment?
We are not independant of the real world any longer and I believe the bubble must burst, it is a matter of when.
A relative point is Australia has been excepting large quantities of immigrants for a long time.
Now the general public wants a serious debate on the subject of immigration.

[SimonV]

The trouble with the housing costs is demand. Now the Government in their wisdom has opened up the market to foreign investors the prises have gone through the roof in some choice areas. Forcing the well to do, local buyers who are forced out of their chosen suburbs to move into the next suburb and so it goes on like ripples on the pond.

[sarafina]

This is looking pretty off topic here guys...

now if we were talking about the cost of slips...?

[beau]

The topic was

Australian Real Estate: The Next Bubble ?

Boat prices follow real estate prices we all know that.

What is Off topic, Sarafini?

[Doodles]

Originally Posted by sarafina

This is looking pretty off topic here guys...

now if we were talking about the cost of slips...?

Real estate investment and rental is often mentioned as a way of funding a cruising life, and there have been several Australian cruisers advocating this so I thought it would be good information for discussion.

[MarkJ]

The dream is to have the solid, dependable income, long term, with small outgoings and steadily capital gain. It makes cruising much more funner

I doubt anyone holding real-estate for more than 5 years in Sydneys eastern Suburbs, walking distance to city, Melbourne city ring out to St Kilda, Toorak, Camberwell etc has ever, ever made a loss and I doubt they ever ever will. The only exception is units advertised on TV, home shows and billboards like Docklands etc and even those would be fine on the 10 year view.

As an investment for cruising there is none better imho, and houses far better than units (strat levies etc).

Other rules (imho): Only ever buy in Capital cities (excluding canberra), never buy where time share has been used at all. Adelaide is too slow, Darwin too far, Hobart too cold.

Non cap cities: Good: Mornington Peninsula, some Gold Coast, some Noosa but for renting out - none.

But for me, ever only Sydney houses in the East and inner west. 'Affordable' places to look at: innner city to Newtown, Ashfield, 5 dock/drummoyne, Leichhardt.
Or south eastern suburbs Maroubra, Kensington, Botany etc but get the flight paths map and plot them and avoid.

With good real estate is doesn't really matter if it goes down a bit now and again, cruisers need to look at the long term, both in rents and capital gains.

It sounds just so easy, but I know its damned difficult.


Mark

[VirtualVagabond]

Originally Posted by MarkJ

The dream is to have the solid, dependable income, long term, with small outgoings and steadily capital gain. It makes cruising much more funner


With good real estate is doesn't really matter if it goes down a bit now and again, cruisers need to look at the long term, both in rents and capital gains.

It sounds just so easy, but I know its damned difficult.


Mark

I agree with all of Mark's comments.... maybe with the exception of "funner"

That degree of knowledge I suspect comes from someone who has worked hard and used it to achieve their current lifestyle. Well done, I salute you
I couldn't afford to buy into the Sydney market, as much as I would have liked to. But even so, I managed to get some cheapies west of Newcastle (Kurri Kurri/East Maitland). Both areas service the coal mining areas. I went for small blocks of units. No strata fees, rents have doubled in under 10 years, capital appreciation has been quite good, and we plan to be sailing soon. (house is on the market now). Rents will continue to rise at least with the cpi, but mortgages don't, so income will get stronger provided Interest rates don't go mad.
I see it as the best sailing set up long term. Time will tell.

[sarafina]

Originally Posted by Doodles

Real estate investment and rental is often mentioned as a way of funding a cruising life, and there have been several Australian cruisers advocating this so I thought it would be good information for discussion.

Originally Posted by beau

The topic was
Boat prices follow real estate prices we all know that.

What is Off topic, Sarafini?

The topic of real estate investment, all over the globe not just in Oz, could be considered to be pertinent to anyone, including cruisers, but there are forums dedicated to real estate where the topic could be more appropriately and knowledgeably discussed.

This forum is about cruising, sailing and the people who do it.

And boat prices follow the price of everything so that does not make it particularly topical either.

I'm just sayin...

[jmo64]

A very interesting and topical subject important to all. Real estate now affects global monetary balance immensely and therefore savings, retirement and the ability to maintain a cruising lifestyle.

I can't think of a thread that would be more funner.

[Doodles]

Originally Posted by jmo64

A very interesting and topical subject important to all. Real estate now affects global monetary balance immensely and therefore savings, retirement and the ability to maintain a cruising lifestyle.

I can't think of a thread that would be more funner.

Exactly, we are all being effected as this global financial crisis is sweeping around the world. Where the next bubbles are is important to recognize and when they may burst. The article did not single out Australia but listed several (of which it was one) countries that warranted attention including Great Britain, Sweden and France, countries that have there share of cruisers.