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Mechanics of the process are simple. Say yesterday rate cut was like a bucket of petrol poured into Sydney's market. 10% and 14% over the last two years correspondingly, plus minimum 20% over the next 12 months.
That would put Sydney property out of reach for the investors. Both in the term of price (borrowing capacity) and rental returns. Where returns fall below 3%, investors stop buying.
Adelaide at the moment has highest rental returns in the country. Where would investors come?
Wait for the train. It is funny to watch it. Cavalcades of Mercedeces and Porches stopping at every real estate sign on the waterfront, and getting out their mobile phones. This is the phase one.
Phase two - they stopping at every house on the Esplanade and door knock. Mailbox gets the leaflets with the offers almost daily.
All you have got to do - is pat yourself on the shoulder and say to yourself - "Mate, you are real intelligent!".
Couple of more quotations about the directions of interest rates and property market. If you say that these projections are made by a person who is more responsible than myself and not that extremist, I would agree.
But unfortunately you do not know that since 1980 I always wanted to make a mistake in economic prognosis, but for some obscure reason I was always right.
May be little bit off with timing.
"I am also upgrading my forecast for median residential property price gains to 10 per cent from 5 per cent in 2015"
Read more: http://www.smh.com.au/business/marke...#ixzz3RQYaX5X8
My prognosis - Adelaide may be 10%. Sydney - between 20 and 30%.
"However, against a global backdrop of deflationary forces and competitive currency devaluations, I think there is very real possibility of the cash rate with a '1' handle at some stage over the next 12-18 months,"
Read more: http://www.smh.com.au/business/marke...#ixzz3RQw1Oyx9
I would agree with that. While we MUST have 0% RIGHT NOW to dodge the deflation, I personally know couple of chaps on RBA board. I would not trust them even to clean my toilet.
I personally know couple of chaps on RBA board. I would not trust them even to clean my toilet.
You crack me up!
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What does your property portfolio contain @notpom???
It must be very healthy.
Mine is a mix of long term investment, short term letters and commercial, interstate interests and some interests in the UK.
For that reason, only Torrens Title, only established, only under the median, only if I can develop or improve and when I am sure it will grow.
The last bit is hard to explain. It is just a gut feeling, but never fails. On my list I have got a few properties that doubled in price within a year after I bought.
The absolute record - few that quadrupled in value within a month. When boom starts - you sometimes get very funny things.
Long term fixed rates mean only one thing.
Banks offer fixed rates to make more money off your fears, not to make losses.
10 year fixed means they know that for the next 10 years rates will be LOW.
So where do you mention your portfolio??
I am very keen to learn from an obvious master .
I know you mention a "List" but is that actually a Portfolio you can show me, I am keen to learn. I can quite happily, but perhaps privately show you the portfolio I have built up over 35 years.
Some from the "time" investment theorem and others from the "Wants and Needs " theorem.
As an astute master investor I am sure you are very familiar with the above theorems.
A lot of posters in here will vouch for my astuteness in property but it seems I am speaking to an actual guru.
Last edited by Guest75; 12-02-2015 at 12:28 PM. Reason: Pants wettingly excited and made a shpeeling mishtak.
I actually thought my portfolio of property was a very mixed and balanced one - from Commercial ( good returns but fairly poor capital gains to higher risk in the Northern Territories).
I also would only buy Torrens, but I do own outright most of my properties - banks scream to lend money to me but I resist.