Does anyone believe this?

This is what Marc Faber said in a recent interview:

And as a special tip, I think I would short the Australian dollar, because talking about a housing bubble, Australia has 10 times a bigger bubble than China. In Australia you have what you said we don’t really have in China, namely the low leverage that we have in China, we have the opposite in Australia, very high household leverage. … So I think a big downfall is about to happen."

Seems to have some conviction in what he's saying

Either :

1) he's right
2) he's wrong and doesn't know what he's talking about
3) stands to profit out of influencing others about a down turn.

I'm asking since i was seriously thinking of buying a place instead of renting, but now not so sure....not looking to stir up a hornets nest though.

petermac33 said...

house prices in aust esp sydney + perth, possibly highest in world.

if stockmarket drops as predicted by so many, so will house prices.

you can by a 4 bedroom nice house in liverpool u.k for 95000 pounds.

similar house in aust would cost around $400/450

my point, aust house prices are over-valued.

i would rent and put any spare money into gold or silver, esp silver.

the same advice as i've being saying for last 5 years.

Don't disagree with you, but those houses will still be bought, sold & rented to those that take your advice...so either way, economy & interest influence the prices.

It is all relative and it is all cyclic.

The investment or economic clock is based on history but it cannot predict the future. It can help one make a fairly educated guess at what the future will be.



Would anybody like to say what time it is??

I think it is about 6 o'clock. This would indicate a housing shortage and therefore higher rents. With more singles about than ever before, renting two or three rooms of your own house out can be more profitable than renting the whole house out. It does take a little more management though.

Income:House price ratio is higher than average.

Therefore Incomes are set to boom. Way overdue.

or

Income:House price ratio was under average for a long time. Now back to normal.

Who the hell would want to live in cold, dark, depressing, northern England Liverpool for any amount of pounds!!!! Compared to living in sunny, optimistic, future-looking, windy (sometimes!?) Australia!!!!

Australia's one of the best countries in the world to live in so you pay more to live in it. Everyone's more optimistic so the prices are higher.

(Just my personal opinion having left the UK ten years ago to come to live in Australia. And there's no way I'm going back!!! No matter what a house price comparison might be).

House prices aren't gonna drop unless there's a significant increase in unemployment. Housing is not a liquid market and housing buyer and sellers are not rational. If you can't get the price you want for your house, you don't sell it. Pricing is not as elastic as theory might suggest until you lose your job, the bank repossesses your house and there's a forced sale.

When's the best time to buy a house? 30 years ago.

When's the second best time to buy a house? Now.

Cambodge, either selling or just bought property?

that quote in the opening post just gave me a headache or something.

GalahOnTheBay said...

cisco said...

Clearly that clock is broken. It's missing "beer"

Fact is that clock would require 24 beers.
it's always time for beer

you'd have to pay me 95000 pounds to live under this.

at least Perth is not being chemtrailed......yet.

cisco said...

Real Estate is like Sex. You should get as much of it as you possibly can, while you are still young.

And hope like hell that interest rates don't go to 16% like they did for me.

In Sydney at least the residential rental market is very tight. There are very few empty properties and what seems to be more people trying to find somewhere to live.

To me its unlikely property prices can drop all that much here. If you have to pay $400 a week to rent a unit on the outskirts of Sydney then its unrealistic to say its value is much less than $350,000 or so.

To me housing bubbles occur when rents fail to keep up with price rises due to either lower demand or increased supply. When this is combined with high vacancy rates, then falls in prices are inevitable.

Sure if you hold the line that property prices will fall then one day you will be right. In the meantime those that went out and bought earlier have experienced rising values most of the time. So buying a place for $300K and then it going up to $450K and then dropping back to $400K isn't all that bad.

Personally I think high property prices is bad for the country but good for individuals. As a result politicians won't do anything meaningful to reduce property prices.

BadAltitude said...

Sailhack said...

petermac33 said...



you can by a 4 bedroom nice house in liverpool u.k for 95000 pounds.

similar house in aust would cost around $400/450

Yeah right !!!!
95k is starter home/first time buyer territory in the UK, not 4 bed.


fact remains Australia is head and shoulders above UK, so make room guys we are coming sooooooooooon

soon? half of freakin england is here in wa already!

watching Relocation Relocation a couple were shown a 4bdr house in Liverpool, price 95k that looked good.

95k in other parts of U.K would be a start up house.

Mobydisc said...
As long as people keep coming to Australia and they can get work, prices will not fall.

As long as people keep breeding and need shelter, houses will go up in value.

Have read recently about big increases coming, and the flip side, big decreases due to a bubble.

Demand seems to be higher than supply. This normally means upwards pressure on prices.

Housing in this country makes me laugh.

$450,000 for a small unit with no parking and not even enough space for a washing machine in St. Kilda... WTF?

It's not like Australia has a shortage of land!