Posted to Herald Sun (9/10/2011) on 9/10/2011 at 11:59 AM, 12:15 PM
Commenting on “Home owners' $300m blow”
http://www.heraldsun.com.au/news/more-news/home-owners-300-blow/story-fn7x8me2-1226162101573
Real estate cycle is about 10 years, but the recent one has been distorted to about 12 years, by government policies enticing buyers to commit excessive loans, RBA's far-from-accurate interest rate modelling and banks' / financial institutions' greed to skin off extra from heavily debt burden borrowers.
Investing in high rise apartments even in the CBD always carry a lot more risks because Australia is not ready for it. For those with employment, they have enough being "imprisoned" at their workplaces few hours a day, and would rather spend the rest of non-working hours in more spacious dwellings.
Our population is still far too small to call for high rise apartments which look like one-finger salute. Despite all the bad publicity, properties near water will have their days of glory returned sooner than the other similar investments, say around 30 to 40 years away. Beware of owners' corporation fees, they are like daylight robbery – why spend money on pool or gym for other people’s enjoyment!
Prices are not just due to supply and demand, but the ultimate reason is scarcity of land. It may be cold comfort for some, but the upswing of the cycle is likely to be in March / April 2013.
Read additional comment by clicking here
Commenting on “Home owners' $300m blow”
http://www.heraldsun.com.au/news/more-news/home-owners-300-blow/story-fn7x8me2-1226162101573
Real estate cycle is about 10 years, but the recent one has been distorted to about 12 years, by government policies enticing buyers to commit excessive loans, RBA's far-from-accurate interest rate modelling and banks' / financial institutions' greed to skin off extra from heavily debt burden borrowers.
Investing in high rise apartments even in the CBD always carry a lot more risks because Australia is not ready for it. For those with employment, they have enough being "imprisoned" at their workplaces few hours a day, and would rather spend the rest of non-working hours in more spacious dwellings.
Our population is still far too small to call for high rise apartments which look like one-finger salute. Despite all the bad publicity, properties near water will have their days of glory returned sooner than the other similar investments, say around 30 to 40 years away. Beware of owners' corporation fees, they are like daylight robbery – why spend money on pool or gym for other people’s enjoyment!
Prices are not just due to supply and demand, but the ultimate reason is scarcity of land. It may be cold comfort for some, but the upswing of the cycle is likely to be in March / April 2013.
Read additional comment by clicking here
