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.
However, the business is still under pressure after suffering from the financial crisis which occurred earlier this month. Despite their growth, Mirvac’s earnings ratio has been dipping since 2007.
Is Aussie property really in a price bubble? Well, yes and no. I say yes and no because property has some unique characteristics that make it hard to compare to stock or cryptocurrency bubbles. Let’s have a look at a few of them now.
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.
JB Hi-Fi Limited shares have gained 4.89% today. At time of writing, shares are trading at $28.11 up from $26.80 yesterday. What caused the share price increase?
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.
Is the Aussie property market ready for a fall? The experts seem to think so. One thing to remember in all this is that the experts have been predicting an Aussie property crash every year now since 2011.
You may have heard of the ‘prisoner’s dilemma’. It’s a standard example in a branch of economics called game theory. Well nowadays, the classical models of economics taught in universities have proven to be poor models of reality. Which brings us to the investor’s dilemma today.
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.