Thought about buying a house recently? Or even selling? If you’ve been looking into the real estate market, or simply watching the news over the past decade, you’ll have noticed that housing prices have soared. It also would have been quite difficult for you to miss the housing crisis currently spreading throughout the country.
For quite some time now we’ve been told by economists and experts that the housing market will fall. When that’s supposed to happen? Nobody can say for sure. However, you have to consider that it may not happen at all.
The divide between the generations is real. And although starting off has never been easy — and it’s not meant to be easy — it’s still fair to say no generation has had to start off at such a disadvantage when it comes to buying a roof over your head.
Australians, individually and collectively, have bet everything on housing. And every year, we double down on that bet. There’s no certainty that 2018 will be the year our housing gamble goes bust. But it would be madness to be certain that it can’t. Aussie property investors in Australia could be in for a rough year.
In today’s article, Ryan looks at the age-old story of bubbles, and why humans keep repeating the same financial mistakes again and again. It was originally published on 21 November, but the warning it contains is just as relevant today.
The further away from ‘normal’ a prediction is, the less our brain is inclined to believe it. That anchoring mechanism is then backed up by a second survival trait. The tendency to stay in the safety of the herd. The result?
What’s a young person or couple to do, then? Buy into the most inflated asset of all time and hope interest rates stay low enough, long enough for a new generation to come along and keep the Ponzi scheme going? I think Australian society has to come together to start addressing this growing problem.
Real estate business Domain has officially listed today, opening at $3.80 per share. Giving it a market cap just shy $2.2 billion.
Bad debts are at historic lows, and it’s proving a big windfall for the big four. But you have to think, if house prices had gotten so high and had the consumer stretched to breaking point, you’d expect bad debts at the big four to be rising, not falling!
A daily commute from Sydney to Melbourne will be feasible. It’s just a small part of a technological revolution slowly creeping into modern life. And it could be game-changing. This new technology could have a very strange effect on future Australian property prices.