Baby boomers continue to squeeze out first-timers

Posted to The Age (14/1/2014) on 14/1/2014 at 2:25 PM
Commenting on "Baby boomers continue to squeeze out first-timers"
http://theage.domain.com.au/real-estate-news/baby-boomers-continue-to-squeeze-out-firsttimers-20140113-30qx1.html?rand=6343785

Investors in property or stock market have one and one thing in mind - how to get maximum return for their investments.

With a bundle of cash, and very low bank interest for deposit and no capital growth, even a primary student will understand that it is better to invest in something which might achieve either one or both growth criteria.

There are property investment gurus around giving advice on wealth creation. Some gurus have very doggy past, and a number will ask the audience to sign up at the end of their seminars to invest in development somewhere close to the universe boundary.

Many dreams turn to nightmare where their investment properties become vacant. Investing when the property market is hot spells doom for many, because when the market cools, the net capital gain is no better than having money dashed under the pillow.

Do first time home buyers just want a shelter? Unfortunately, many have high expectations of staying close to workplace, train station, bus stop, school, church, supermarket, etc. They can't sacrifice their sleep, the cafés or their previous fun life-style.

Life is a compromise, and we cannot have the cake and eat it too. Although one has to live for today, because no one knows what tomorrow will bring, one has to realise that the average life span is around 75. Few years of waking up early to get to work, toiling in the garden to landscape it or grow vegetable supplies, learn to cook and stay home for dinner, watch DVD instead of sitting in a cinema, etc will definitely make the difference to the mortgage repayment.

The day will come - it is indescribable joy when the bank manager rings to inform that the title is fully discharged.

Where is the housing market headed? (Post 4 of 5)

Posted to The Age (13/12/2011) on 15/12/2011 at 5:00 AM
Commenting on "Where is the housing market headed?"
http://theage.domain.com.au/blogs/talking-property/where-is-the-housing-market-headed-20111213-1osf0.html

I seek opportunity by predicting dooms. There is nothing to worry about if everything is hunky-dory, until things get over-heated. Buying during good times give low to negative returns; one may even lose the initial capital if the property is disposed early. If one is greedy and does not understand that property is a very long term investment, he is no wiser than those who invest in the shiniest, fastest and latest car.

When there is shortage of food, we grow food. When there is insufficient housing, we build more houses or multi-storey buildings. However, growing food and building dwellings need one crucial thing, namely land. When land becomes scarce, we cannot grow land! Scarcity pushes price up!

Many baby boomers had the opportunity to work two or three jobs during their younger days, and have experienced at least two recessions prior. They are not spendthrift like the younger generations, and have tucked away a fair amount of money. Some baby boomers who are ready to hang up their boots may not want to invest in real estate directly, but give away their money to their offspring as deposits or partial payments towards their first homes. Invariably, this provides an impetus for stimulating the next buying upswing.

As long as external influences do not have direct impact on an Australian citizen’s financial position, he will continue to live his life style and invest in property. However, if the impact is negatively drastic, real estate industry will slide to the point until cash-up opportunists come along to grab a good deal!