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 Post subject: Re: Ominous signs in Australia
PostPosted: Thu Jul 19, 2018 12:42 am 
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https://amp.smh.com.au/business/the-economy/the-epicentre-of-the-downturn-sydney-housing-slump-to-last-until-at-least-2020-say-economists-20180719-p4zsa9.html

The 'epicentre of the downturn': Sydney housing slump to last until at least 2020, say economists
Quote:
The key takeaway from economists: the "fear of missing out" is now over. And while predictions are for a relatively soft landing, it's time for the market to adjust to a new normal.


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 Post subject: Re: Ominous signs in Australia
PostPosted: Mon Sep 17, 2018 4:35 am 
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https://www.afr.com/real-estate/residen ... 915-h15fq6

Quote:
Sydney house prices have fallen 7.1 per cent over the past 12 months with Melbourne down 2.7 per cent


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 Post subject: Re: Ominous signs in Australia
PostPosted: Tue Sep 18, 2018 7:57 pm 
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Bricks and slaughter: Part one - Exposing Australia's housing crisis | 60 Minutes Australia



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It’s no secret that Australia is experiencing a downturn in the property market. But for Aussies who own their own home or have a mortgage, there’s worse news. Many believe calling it a downturn is foolishly optimistic – the slump we are in is more like falling off a cliff.


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 Post subject: Re: Ominous signs in Australia
PostPosted: Tue Sep 18, 2018 10:43 pm 
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snaps wrote:
Bricks and slaughter: Part one - Exposing Australia's housing crisis | 60 Minutes Australia

Went onto the second part two, comments disabled. It's going to be a bloodbath.

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Every single frozen corpse in the Death Zone on Everest was once a highly motivated person.

Those who don't study history are doomed to repeat it. Those who do study history are doomed to watch everyone else repeating it.


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 Post subject: Re: Ominous signs in Australia
PostPosted: Tue Sep 18, 2018 11:25 pm 
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https://www.professionalplanner.com.au/ ... or-a-rout/

That is well worth a read

Quote:
question is whether the rapid accumulation of household debt – to record levels – will produce not only weaker economic growth (through a decline in construction activity, home sales, renovation demand and, consequently, consumer spending and sentiment) but also a more painful experience, such as a recession.



Quote:
over the last five years, the banks have written $650 billion in interest-only mortgages. That represents about 40 per cent of the total book of mortgages written. The value of interest-only loans maturing next year will be $133 billion. That figure will peak in 2020 at about $159 billion, with another $135 billion maturing in 2021 and $117 billion doing so in 2022. If 40 per cent of the total book is interest-only and the APRA-imposed cap is 30 per cent of all new loans written (assuming no system growth), that means about 10 per cent or $136 billion will migrate from interest-only to P&I between now and 2022.

ASIC states that the average size of an interest-only mortgage is $347,000, which means there are about 392,000 interest-only mortgagors migrating to P&I between 2019 and 2022. Keep in mind it is the marginal buyer and seller that will determine the price of everyone’s property. It is the behaviour of buyers and sellers next weekend that determines property prices for all of us.



Quote:
AGL Energy financial year 2017-18 result showing bad and doubtful debts jumped more than 20 per cent, to $94 million – equal to fully 13 per cent of the CBA’s bad and doubtful debt charge.



Quote:
Australia-wide, home-loan growth is going backwards at the rate of about 8.4 per cent as at June this year


Quote:
tidal wave of interest-only mortgages that would switch to principal and interest (P&I), and which would be accompanied by a rise in repayments of as much as 40 per cent. Clearly, this will have a dampening effect on discretionary spending.


Quote:
we haven’t even touched on the impact of a 65 per cent slump in applications to the Foreign Investor Review Board (FIRB) by foreign entities for investment in housing


Quote:
Moody’s data shows that the 90 days past due delinquency rate for mortgages that have converted to P&I from IO is 0.94 per cent, double that of IO loans that have not yet converted and 0.24 percentage points higher than all securitised mortgages.”


Quote:
owner-occupier loans for alterations and additions slumped about 20 per cent, year-on-year


again, worth a read


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 Post subject: Re: Ominous signs in Australia
PostPosted: Wed Sep 19, 2018 9:40 am 
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Excellent article


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 Post subject: Re: Ominous signs in Australia
PostPosted: Thu Sep 20, 2018 12:18 am 
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Quarterly Figures

Image

http://www.abs.gov.au/ausstats/abs@.nsf ... num=&view=

Quote:
Annually, residential property prices fell in Darwin (-6.1%), Sydney (-3.9%) and Perth (-0.9%), and rose in Hobart (+15.5%), Canberra (+3.0%), Melbourne (+2.3%), Adelaide (+2.1%) and Brisbane (+1.7%).

http://www.abs.gov.au/ausstats/abs@.nsf/mf/6416.0


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 Post subject: Re: Ominous signs in Australia
PostPosted: Thu Sep 20, 2018 4:34 am 
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Quote:
Overall, Australia's population grew by 380,700 people to reach 24.9 million in the year ending March 2018.

Net overseas migration added 236,800 people to the population, and accounted for 62 per cent of Australia's total population growth.


http://www.abs.gov.au/ausstats/abs@.nsf ... Mar%202018

Highly highly relevant as there are some reports of vacancy rates dropping and rents rising which would put a floor under price drops. The government very deliberately put the foot down on the accelerator of migration over the past few years.

It is labeled as skilled migration but thats only a tiny amount relative to the new 'temporary' visas that have been issued. Those 'temporary' visas are a route for large numbers of low skilled third world migrants who will cram in to Sydney and Melbourne (and they are as its far better than the slums they come from). The catch is a very real race to low standards of living.

Quote:
This faster-than-expected surge in population has been an important element in propping up the Australian economy and has supported the ‘27 years of continuous economic growth’ narrative. Indeed, it is possibly the only element, given that population increase contributed around two-thirds of total economic growth in Australia since the GFC.

The challenge is that, while Australia’s income continues to increase on the back of population growth, last year we saw a small decline in real income per capita. That is, while population growth is propping up our headline economic growth figures, the real standard of living has stagnated and fallen slightly (0.2%).


https://www.pwc.com.au/press-room/2018/ ... oming.html


The government doubled down on property quite a while ago. Remember they also guaranteed the banks in 2008 (which had the unintended consequence of relieving the banks of negative impacts of irresponsible lending) thereby throwing fuel on the fire.

Nevertheless at growth of 380,000 a year and an average household size of 2.6 it equates to a demand of 152,000 properties a year. The rate is currently over 200,000 being built a year


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 Post subject: Re: Ominous signs in Australia
PostPosted: Thu Sep 20, 2018 9:34 am 
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Spoke to a banker in Sydney. "Soft landing on the way, Sydney back 5-10%, with another 5-10% to come, Perth already bottomed out, Brisbane and Adelaide never had a boom."

Safe to say that panic hasn't set in just yet... :x

We all partied. XD BD


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 Post subject: Re: Ominous signs in Australia
PostPosted: Thu Sep 20, 2018 3:39 pm 
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Location: Hollywood
https://www.afr.com/real-estate/one-in- ... 920-h15mt1

https://rogermontgomery.com/how-well-do ... more-28335

Second link would leave you speechless or you might laugh out loud alot. It's subscription but free to, do it if you are Aussie based


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