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The dud Kangaroo bounce thread


sancho panza

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Well, what are the chances?

2 days into the new PM's term and suddenly we have seized an illegal immigrant boat!

https://www.smh.com.au/politics/federal/asylum-seeker-vessel-runs-aground-in-north-queensland-20180826-p4zzwm.html

Complete coincidence that the PM is the man who single handedly "stopped the boats" some years back and therefore saved Australia. 

 

There havent been any reports of boatloads of illegals for quite a while at least not reported ones

So which is it Either this is a strategic move by the new leader to remind us all how much we need him to 'save' us all (again) Or is there a more powerful force at play, ie someone is setting off a warning to the new PM not to fuck up or the country will magically get invaded with wave after wave of boats...

 

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Chewing Grass

Was stumbling around the net and was surprised to find out that Australia’s population is 25 Million whilst the UK is rocketing up towards 75 Million.

5 Million or 1/5th of them live in Sydney, another 4.8 Million live in Melbourne, 2.4 Million in Brisbane and 2.2 Million in Perth.

The rest are smeared around the edges.

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sancho panza
12 hours ago, Sugarlips said:

Wheels are seriously coming off here in Oz:

https://www.macrobusiness.com.au/2018/08/mortgage-rejections-skyrocket-1347-credit-crunches/

The 'major banks reduction in borrowing power' table says it all, but the comments are worth a giggle as well..

Cross posting from the deflation thread for reference purposes.

'

Mortgage rejections skyrocket 1347% as credit crunches

By Houses and Holes in Australian banks, Australian Property

at 12:19 am on August 27, 2018 | 100 comments

 

Via Martin North:

DFA research was featured in a number of the weekend papers, discussing the rising number of mortgage loan applications which are being rejected by lenders due to tighter lending standards, meaning that many households are unable to access the low refinance rates currently on offer.

Weeklt-Times-1.jpgNEARLY half of all homeowners are now shackled to their mortgage, with refinance rejections up significantly cent in less than a year as banks rattled by the royal commission drastically tighten borrowing rules.

 

Loan sizes are being slashed by 30 per cent, trapping many financially stressed customers including some who have been slugged with “out of cycle” interest rate rises. House hunters are also being hit by the credit crunch, with dramatic implications for property markets. The crunch stems from two big shifts in the way banks judge borrowers.

Expense estimates have been raised substantially — the minimum outgoings for an average household are now assumed to be a third higher, according to bank analysts UBS.

On top of this, granular cost breakdowns must be provided. After the royal commission revealed in March that expense checks were so lax as to be borderline illegal, new tests have been imposed requiring in some cases detail of weekly, fortnightly, monthly, quarterly and annual spending in as many as 37 categories from alcohol and haircare to shoes and pets, as well as doctor visits.

As a result, we think that now four in 10 households would now have difficulty refinancing.  That means you are basically a prisoner in the loan you’ve currently got. This is based on our 52,000 household surveys plus data from a range of official sources. We estimate that 31,000 households’ refinance applications were rejected in July versus 2,300 in August last year.

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https://wolfstreet.com/2018/09/03/house-price-condo-bubble-sydney-melbourne-australia-new-construction-supply/

Housing Bubble Pops in Sydney & Melbourne, Australia

by Wolf Richter • Sep 3, 2018 • 12 Comments

And with impeccable timing, an immense flood of new construction.

In Sydney, breeding ground for one of the world’s biggest housing bubbles, prices of single-family houses dropped 7.3% in August, compared to a year earlier. Prices of “units” — condos in US lingo — fell 2.2% year-over-year. Price declines were the sharpest at the high end, with prices down 8.1% in the most expensive quarter of home sales. Prices of all types of homes combined fell 5.6%, according to CoreLogic’s Daily Home Value Index. The index is down 5.8% from its peak last September:

Australia-home-prices-Sydney-2018-08-31.

Melbourne, where the inflection point has been lagging a few months behind Sydney’s, is in the process of catching up. Over the three month-period, June-August, prices fell 2.0%, making Melbourne the weakest housing market among the capital cities. By segment, house prices fell 2.7% from a year ago while condo prices still inched up 1.5%. At the most expensive quarter of sales, prices fell 5.2% from a year ago. For all types of dwellings combined, prices declined 1.7% year-over-year, to the lowest level since early June 2017, according to CoreLogic. Prices are down 3.6% from their peak at the end of November 2017:

Australia-home-prices-Melbourne-2018-08-

Corelogic tracks the largest five of Australia’s eight capital cities in a separate index. Due to the size of their housing markets, Sydney and Melbourne weigh the most. In the remaining three of the five capital cities in the index, prices were mixed in August:

  • In Brisbane, home prices inched up 0.9% year-over-year.
  • In Adelaide, home prices ticked up 1.0%.
  • In Perth, home prices fell 2.0%, with houses down 1.5% and condos down 4.4%. Prices have been skidding since late 2014, when Western Australia mining boom turned into a mining bust.

The aggregate five capital cities index fell 3.1% in August year-over-year. The index has declined month-to-month for 11 months in a row and is down 3.5% from its peak in October 2017:

Australia-home-prices-5-capital-cities-2

With impeccable timing, there is a flood of new condos expected to be completed over the next two years, something avid crane-counters in Sydney and Melbourne have been swearing for a while. Here are some of these astounding numbers that CoreLogic estimates based on data it collected from the industry:

Greater Sydney: In 2019: 31,500 new condos are scheduled to be completed. In 2020, another 45,500 condos are expected to be completed. This brings the two-year total of new condos to 77,000 units, which will increase the total stock of condos by 9.3%!

Greater Melbourne: The oncoming flood of new condos is expected to reach 29,000 units in 2019 and nearly 50,000 units in 2020. Over the two years, this will increase the total stock of condos by nearly 79,000 units, or by 11.5%!

As it becomes harder to find buyers for these projects, developers may delay or cancel some of them. So not all of these units may be completed in the two-year period.

In some of the other cities, the stock of condos is expected to increase over the next two years in similar fashion:

  • Greater Brisbane by a whopping 18.4%
  • Greater Adelaide by 12.5%
  • Greater Perth by 5.7%
  • Greater Hobart by 3.8%
  • Greater Darwin by 9.9%

Nationally, 94,500 condos are estimated to be added in 2019 and 2020, which would increase the existing stock by 9.3%! And so CoreLogic explains:

Over the past five years there has been a significant increase in overall unit supply. At the same time, housing market conditions have deteriorated over the past year, particularly in Sydney and Melbourne, with dwelling values falling and rental growth slowing.

In the face of weakening housing market conditions, both of these cities still have a high volume of unit stock to be completed. As the new supply comes on line over the coming years, it is anticipated that this could lead to further softening of both dwelling values and rents in Sydney and Melbourne.

In its home value report, released today, CoreLogic has a somber outlook:

t’s likely the spring season will be a challenging one for the housing sector. Advertised stock levels are already 7.6% higher than the same time last year across the combined capitals, despite a 5.7% reduction in ‘fresh’ stock being added to the market. The rise in inventory is simply due to a lack of absorption; with fewer buyers, homes are taking longer to sell and clearance rates [of homes sold at auction] have trended into the mid to low 50% range.

 

One of the reasons for the downturn is the fairly sudden exit of investors and speculators, which for banks are among the riskiest elements. Starting in 2014, Australia’s banking regulator (APRA) and the Council of Financial Regulators introduced “macroprudential policies” (summary) that were designed to cut down speculation in the housing market. They initially produced no results. Speculation increased, and prices jumped. But as they were tightened, including the imposition of a 30% limit per bank on interest-only mortgages and higher interest rates on mortgages for investors, they suddenly began to bite.

After publicized scandals, shenanigans, and the findings by the Royal Commission investigation into the banks, lending standards have been tightened on the margins for potential homebuyers as well, some of whom are now being sidelined by the new focus on sustainable debt-to-income ratios and the crackdown on mortgage fraud, particularly in the most overpriced markets, Sydney and Melbourne.

As prices are declining and rental yields are historically low, investors and speculators will be further discouraged because now, the quick and easy gains have moved out of view.

All this is happening even as mortgage rates remain at historic lows. But mortgage rates too are expected to tick up as funding costs for the banks have risen – and will likely continue to rise. Smaller banks have already lifted mortgage rates, and now Westpac has become the first of the big four banks to increase its rate for variable rate mortgages. The other banks will follow. And according to CoreLogic, this “is likely to send a chill through the housing market.”

Real estate is local and prices tend to move slowly over many years, on the way up as well as on the way down. But the housing markets of Sydney and Melbourne, ranked globally in the top housing bubbles, have passed a clearly visible inflection point late last year, when price moves changed direction and have formed well-defined U-turn.

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https://moneymaven.io/mishtalk/economics/housing-wipe-out-no-bids-or-even-bidders-at-numerous-australia-housing-auctions-l01MgvjMF0-RdXRBjO7gfA/

'

The numbers of potential bidders in recent housing auction in Australia dropped to less than one. Most did not bid.

It's a Housing Wipe-Out in Australia.

  • Bidders per auction: 0.7 – a very negative stat for the start of the Spring market.
  • 10 auctions in Bayside: 3 bidders in total.
  • 13 auctions in Stonnington and if you take out the 2 volcanoes (4 or more bidders) there were 5 bidders at the other 11 auctions.
  • In Boroondara there were 12 auctions and 9 of them had no bidders at all.

No Bidders

The dramatic change in the Sydney property market was obvious at two auctions on Saturday that achieved an outcome unheard of just months ago: no bidders turned up.

At the sale of a brand-new four-bedroom penthouse Lidcombe, in Sydney's almost-inner west, The Australian Financial Review was the only attendee.

"Are you here to bid?" the agents asked. Upon hearing I was a journalist, they told me they had interested buyers who didn't turn up.

There were also no bidders at a three-bedroom unrenovated home in Guildford while a two-bedroom unit at Baywater Drive in Wentworth Point was passed it. That unit had been on the market for nearly a year and its asking price has fallen about 12 per cent in that time.

Public records show the vendor was asking for $730,000 in October, and $675,000 on Saturday. It passed in at $645,000 from one registered bidder.

In Melbourne, buyer's agent Morrell and Koren's Emma Bloom said agents were moving to a "less transparent" private treaty sale process to "protect values" of homes. "There are now either no bidders, or one bidder," she said.

Turn Out the Lights

Turn out the lights, the party is over.'

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  • 2 weeks later...

Oz falls for 11th month in a row

https://www.theguardian.com/australia-news/2018/sep/08/buyers-wait-for-bargains-as-australias-housing-market-hits-long-slide

Across Australia, prices have fallen for 11 months in a row. In Sydney, they are down 5.6% over the year, and in Melbourne, they are down 2% in the past three months – the worst drop since Christmas 2011. It wasn’t too long ago that prices surged 11% in one year nationally and 20% in Sydney.

And while it may not be a crash, it seems set to be a long slide. This week, Capital Economics predicted the coming fall would be the “longest and deepest” housing slump in Australia’s modern history.

According to analysts, the fall in house prices is the direct result of new stricter lending standards introduced by the financial regulator Apra in March, and the work of the banking royal commission in exposing the banks’ lax lending standards.

Apra placed a cap on mortgage lenders, limiting the number of risky interest-only loans to only 30% of new mortgages. By April, the value of housing loans fell by 1.6% across the country. Banks were also ordered to make much more rigorous checks of borrowers’ income and expenses to make sure they could afford the loans.

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1 hour ago, darkmarket said:

Australian HPI data released overnight, pushing credibility:

House price index in Australia dropped by 0.7 percent quarter-on-quarter in the three months to June of 2018, the same pace as in the previous quarter but beating market consensus of a 7 percent decline.

https://tradingeconomics.com/australia/housing-index

As per the EA in teh show.He was one of the few who'd talk.We don't know how they measure their indices (mortgage approvals versus prices paid) however we do know that when prices are rising EA's are desperate to get on Homes Under the hammer.

Things must be bad if they're dodging the TV crews.

 

As Mish always says,once price deflation sets in,people just sit tight as each month gets their target cheaper by a couple of grand a time.So not only will we see a rise in listings,we'll see a shrinking of the buyer pool.

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3 minutes ago, sancho panza said:

As Mish always says,once price deflation sets in,people just sit tight as each month gets their target cheaper by a couple of grand a time.So not only will we see a rise in listings,we'll see a shrinking of the buyer pool.

Sentiment has most certainly flipped, I think they're a bit ahead of the UK and generally more extreme but it's all one global credit market.

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3 minutes ago, darkmarket said:

Sentiment has most certainly flipped, I think they're a bit ahead of the UK and generally more extreme but it's all one global credit market.

Are you Ozzie based if you don't mind me asking?

I'm always fascinated with posts from the coalface.The madness of crowds was powerful in Oz I believe.

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Hattip Eric Pebble ToS

Guy talking about shorting Ozzie banks.

At 8:30 starts talking about two thrids of Aus banking assets being in resi property-'we've never seen anything nearly that high before.'

No experience of bad loans/bad loan provisions nowhere near high enough.

'what's going to turn bubble over?'

1) rising rates

2) social issues for people who can't buy houses leading to speculators and foreigners buying houses.

=> transactions down 40% in places like Vancouver.

 

Credit mortgage restrictions-in Canada stress tests 200% basis points over mortgage rates.

Aus Royal Commision reporting large scale mortgage fraud-third of loans are 'liar loans'.

 

Aussie loan to deposit ratio 130% leading to overreliance on wholesale deposits

 

Interesting piece.

 

 

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@sancho panza Thanks for posting the video, very interesting. So even though CAN and AUS saw what happened within the US they've carried on full steam ahead and blown it up twice as big. Do the banks know/believe the government will step in and bail them out?

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7 hours ago, sancho panza said:

Are you Ozzie based if you don't mind me asking?

I'm always fascinated with posts from the coalface.The madness of crowds was powerful in Oz I believe.

Just have a few Australian friends and generally keeping an eye on all the bubbles, as much as each has its own features I do think they're all connected and are ending more or less at once. Interesting in terms of what they say about us as well, not good really.

I also like when you get someone who understands the bigger issues but lives at the coalface to tell you what's going on. Bit of a sense of that with the liquidator there, the estate agent just looked like he wanted to get famous enough to keep his Mercedes.

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6 hours ago, sancho panza said:

Hattip Eric Pebble ToS

Guy talking about shorting Ozzie banks.

Interesting that he chooses banks as the means of shorting. The liar loan figures really are beyond what could have gone unnoticed by government, there must be

datasets that contradict the banks' mortgage profiling.

4 hours ago, Admiral Pepe said:

Do the banks know/believe the government will step in and bail them out?

Bailouts and more QE could be difficult if there isn't the same international consensus as last time, may have unintended consequences. Won't stop them trying though.

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I know of someone who was walked through the liar loan process by their mortgage advisor, it was clear that this was common practice, everyone was at it. Strangely, in this instance, it was not about borrowing more than could be supported by salary (salaries); after being surprised that the subject didn't want a 6x joint salary mortgage (due to fear of unaffordability, borne of an IQ greater than single digits),  the advisor's attention attention turned to gaming the system to qualify (illegally) for the First Home Owner's Grant (free deposit from the government, plus stamp duty exemption) for an investment property (BTL). Ironically, if the subject had gone for the suggested 6x joint salary mortgage, they and their partner would have made, literally, millions (assuming they had had the nous to get out of the Sydney property market prior to 2018).

I have close associates who are, on paper, millionaires a few times over but, in reality, are psychological wrecks, unable to cover their mortgages and "reno" costs (which are multiples of what any sane person would pay here in the UK). 

Australia's housing market is fucked x infinity. Don't even get me started on the arguments I have had with savvy property investors who are losing a fortune on negative rental yields, but are convinced she'll be right due to unrelenting capital appreciation. A nation of fuckwits.

All that glisters is not gold.

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6 hours ago, Admiral Pepe said:

@sancho panza Thanks for posting the video, very interesting. So even though CAN and AUS saw what happened within the US they've carried on full steam ahead and blown it up twice as big. Do the banks know/believe the government will step in and bail them out?

I think it's the unintended consequences of QE.I think the general plan was to fend off deflation and get enough wage inflation going so that earnings eventually caught up with HPI.The plan was meant to work but all it did was bail out the banks and blow another even bigger bubble.The USA has loads of regional bubbles too.

2 hours ago, darkmarket said:

Interesting that he chooses banks as the means of shorting. The liar loan figures really are beyond what could have gone unnoticed by government, there must be

datasets that contradict the banks' mortgage profiling.

Bailouts and more QE could be difficult if there isn't the same international consensus as last time, may have unintended consequences. Won't stop them trying though.

The banks are the liquid short .They tanked in 08 and have risen substantially since.I'm unsure what the policy response will be and whther without Powell on board,there'll be QE lift off worldwide.

image.png.67f6ac4281df44c1be5c66946b496b59.png

29 minutes ago, Ponty Mython said:

I know of someone who was walked through the liar loan process by their mortgage advisor, it was clear that this was common practice, everyone was at it. Strangely, in this instance, it was not about borrowing more than could be supported by salary (salaries); after being surprised that the subject didn't want a 6x joint salary mortgage (due to fear of unaffordability, borne of an IQ greater than single digits),  the advisor's attention attention turned to gaming the system to qualify (illegally) for the First Home Owner's Grant (free deposit from the government, plus stamp duty exemption) for an investment property (BTL). Ironically, if the subject had gone for the suggested 6x joint salary mortgage, they and their partner would have made, literally, millions (assuming they had had the nous to get out of the Sydney property market prior to 2018).

I have close associates who are, on paper, millionaires a few times over but, in reality, are psychological wrecks, unable to cover their mortgages and "reno" costs (which are multiples of what any sane person would pay here in the UK). 

Australia's housing market is fucked x infinity. Don't even get me started on the arguments I have had with savvy property investors who are losing a fortune on negative rental yields, but are convinced she'll be right due to unrelenting capital appreciation. A nation of fuckwits.

All that glisters is not gold.

Any chance you could give a few figures to give an idea of the scale of the problem.Were people massively over renovating places?

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Adelaide anecdote here. My wifes Uncle is a loaded Dentist and purchased a piece of land a few years back and built 4 luxury houses that he is now trying to sell for around $900K each. No buyers of course. He was advised to build a lot more smaller units which would at least have a better yield from a rent perspective. 

Will be interesting to see how this one goes. He is paying out at least $100K a year in interest and is loath to rent them out as they will then be second hand and not as attractive to his mythical Chinese investment buyers. 

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1 hour ago, Ponty Mython said:

I know of someone who was walked through the liar loan process by their mortgage advisor, it was clear that this was common practice, everyone was at it. Strangely, in this instance, it was not about borrowing more than could be supported by salary (salaries); after being surprised that the subject didn't want a 6x joint salary mortgage (due to fear of unaffordability, borne of an IQ greater than single digits),  the advisor's attention attention turned to gaming the system to qualify (illegally) for the First Home Owner's Grant (free deposit from the government, plus stamp duty exemption) for an investment property (BTL). Ironically, if the subject had gone for the suggested 6x joint salary mortgage, they and their partner would have made, literally, millions (assuming they had had the nous to get out of the Sydney property market prior to 2018).

I have close associates who are, on paper, millionaires a few times over but, in reality, are psychological wrecks, unable to cover their mortgages and "reno" costs (which are multiples of what any sane person would pay here in the UK). 

Australia's housing market is fucked x infinity. Don't even get me started on the arguments I have had with savvy property investors who are losing a fortune on negative rental yields, but are convinced she'll be right due to unrelenting capital appreciation. A nation of fuckwits.

All that glisters is not gold.

I

 

44 minutes ago, sancho panza said:

I think it's the unintended consequences of QE.I think the general plan was to fend off deflation and get enough wage inflation going so that earnings eventually caught up with HPI.The plan was meant to work but all it did was bail out the banks and blow another even bigger bubble.The USA has loads of regional bubbles too.

The banks are the liquid short .They tanked in 08 and have risen substantially since.I'm unsure what the policy response will be and whther without Powell on board,there'll be QE lift off worldwide.

image.png.67f6ac4281df44c1be5c66946b496b59.png

Any chance you could give a few figures to give an idea of the scale of the problem.Were people massively over renovating places?

A lot of people living it large - big time. A pikey cunt I knew in perth worked through the boom earning 350-400K a year. Come the slow down and he gets laid off he is behind on his mortgage within 3 months. 

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19 minutes ago, Kurt Barlow said:

I

 

A lot of people living it large - big time. A pikey cunt I knew in perth worked through the boom earning 350-400K a year. Come the slow down and he gets laid off he is behind on his mortgage within 3 months. 

That's pretty impressive by any standards.

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2 hours ago, Ponty Mython said:

I know of someone who was walked through the liar loan process by their mortgage advisor, it was clear that this was common practice, everyone was at it. Strangely, in this instance, it was not about borrowing more than could be supported by salary (salaries); after being surprised that the subject didn't want a 6x joint salary mortgage (due to fear of unaffordability, borne of an IQ greater than single digits),  the advisor's attention attention turned to gaming the system to qualify (illegally) for the First Home Owner's Grant (free deposit from the government, plus stamp duty exemption) for an investment property (BTL). Ironically, if the subject had gone for the suggested 6x joint salary mortgage, they and their partner would have made, literally, millions (assuming they had had the nous to get out of the Sydney property market prior to 2018).

I have close associates who are, on paper, millionaires a few times over but, in reality, are psychological wrecks, unable to cover their mortgages and "reno" costs (which are multiples of what any sane person would pay here in the UK). 

Australia's housing market is fucked x infinity. Don't even get me started on the arguments I have had with savvy property investors who are losing a fortune on negative rental yields, but are convinced she'll be right due to unrelenting capital appreciation. A nation of fuckwits.

All that glisters is not gold.

I had a big argument with a banker in 2010-11 ish after I had seen a big sample of mortgages and supporting documentation at one of the Big 4 banks.  Every time I used the net to do even a little research, it was obvious that the assets written down were inflated.  Example: factory on sheet, tin shed by the side of the road on googlemaps.  A tinny (small boat) valued at 50k when a new one could be have for 15k. etc etc.

 

I said the liar loans were just as bad as in the USA and the crash was therefore baked in.  They got very angry and said that Aussie banks don't do liar loans.  No doubt I'll have to phone them up in a couple of years to say TOLD YOU SO.

 

That said, I have a house in Melbourne (see previous postings) which is rented out at a small negative yield, but LTV is down to 30% by me overpaying the mortgage hard, and we will live in it when we move back.  Mortgage will be zero by then.  So, when the crash happens, we should be able to sit tight, and not be worrying about much. 

 

I hope.

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4 minutes ago, wherebee said:

I had a big argument with a banker in 2010-11 ish after I had seen a big sample of mortgages and supporting documentation at one of the Big 4 banks.  Every time I used the net to do even a little research, it was obvious that the assets written down were inflated.  Example: factory on sheet, tin shed by the side of the road on googlemaps.  A tinny (small boat) valued at 50k when a new one could be have for 15k. etc etc.

 

I said the liar loans were just as bad as in the USA and the crash was therefore baked in.  They got very angry and said that Aussie banks don't do liar loans.  No doubt I'll have to phone them up in a couple of years to say TOLD YOU SO.

 

That said, I have a house in Melbourne (see previous postings) which is rented out at a small negative yield, but LTV is down to 30% by me overpaying the mortgage hard, and we will live in it when we move back.  Mortgage will be zero by then.  So, when the crash happens, we should be able to sit tight, and not be worrying about much. 

 

I hope.

Sounds similar to my wifes 'investment' property in Adelaide which is a 1 bed unit and has lost about $45K in value in the last 7 years. Still can't lose on B&M;)

Fortunately her mortgage is only about 20K so at least its cash positive - she gets about $6000 a year after costs. 

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12 hours ago, sancho panza said:

 

Any chance you could give a few figures to give an idea of the scale of the problem.Were people massively over renovating places?

I don't have figures to the penny, as the bragging stopped as the renovation costs soared, but here goes:

Purchase price mid-2000s: $1.4m (good suburb, period property, in need of refreshing); I thought this was bubblicious at the time...

Renovation (impractical loft conversion and small extension to rear): est. $750k - I can't see that the work would have cost more than £100k here in the UK. On another thread, the $50k fridge is mentioned; no fridge this time, but a light fitting was quoted at $8k, something which could be had for a few hundred quid here.

Agent's recent valuation: $3m+ - in reality, I can't imagine anyone paying more than $2m today, which is still a mental amount of money for a 3 bedroom house.

Joint salary has gone from $300k+ to $100k - and the shortfall is not coming back. Natch, there is also a BTL in the background ($1m for a boggo 2 bed flat).

Until you spend a decent amount of time in Australia, it is difficult to comprehend the addiction to property, it is far worse than the UK. The weekend papers are at least 50% property (I think the big media companies own the equivalents of Rightmove, but can't be arsed to check) and chunky home sales routinely make the national evening news. Almost every home in any decent suburb has been extended and/or renovated to within an inch of its life (or within an inch of its neighbour, usually). Costs of both stuff and labour are eye-watering, no tradie will get out of bed for less than $100 an hour and the really skilled demand far more.

Compound the brain-washing with incredible amounts of financial engineering (see MacQuarie for details), lax lending standards with liar loans absolutely the norm (pushed through brokers to keep the banks' hands clean) and daft tax concessions on BTL and you arrive in Australia. A country that, even 20 years ago, maintained its larrikin charm - no more. In that time, the population has increased from 20m to 25m. OK, it's a big place, but everyone moves to one of the principal 4 cities, making them increasingly unliveable. Melbourne, even now, often tops the list of most desirable cities, but the population has increased massively, the majority of new entrants coming from China, changing the underlying dynamic from European to Asian - this may or may not be a good thing, depending on your taste. 

If Australia didn't have shit in the ground to dig up and sell, it would be a banana republic. I believe that the country will continue to sell entry visas to Asians, pumping the population to keep the wheels spinning. It is far too expensive a place to make anything and long has been (eg car manufacturing all gone). In theory, a high wage economy can be beneficial to the majority; in reality, of course, those high wages get hoovered up by the credit providers.

Despite being economically inactive here in the UK, I have turned down a lucrative offer in Australia (ironically, to work on building the infrastructure that the burgeoning population requires) as the juice is not worth the squeeze. The only place I would consider living now in the country is Hobart - and I haven't been there for years, so might well be disillusioned with today's Tasmania too.

It is all such a shame.

 

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