Monthly Archives: November 2012

THE MARKET – OTHER INDICATORS – UPDATE 16 NOVEMBER 2012

I want to address some questions I’ve had asking where the market really is in its “cycle” and why I keep saying it’s scary. Other than the arguments I’ve already put forward, I’ll address other factors that I study (daily) and why I remain convinced the entire residential market is fragile and will remain so for a while yet.

Continue reading

Tagged , , , , , , , ,

NOT REAL ESTATE – MILITARY POST

Whilst this is primarily a real estate website, I will, from time-to-time, put articles here that relate to my time as a commissioned officer in the Royal Australian Air Force, especially where military and former military personnel are being treated with contempt.  This is one of those articles.  It was written by Gordon Wright on Monday 27 June 2011…

Continue reading

Tagged , , , , ,

HOMES AREN’T BANKS

As property values soared out of control after 2001, many people used the increased equity to fund an outrageous lifestyle or consolidated their massive credit card debts at 21% into long term debt at under 10%.  Many folk in business used the equity to fund business expansion, or as a buffer if their business had seasonal cash flow problems.

The fallout from record insolvencies is flowing into the housing market, and not just at the top end of town where we’ve seen houses sold for half or less of their pre GFC highs.

Company insolvencies were thought to have reached an absolute high in 2011 when just shy of 10,500 fell over but that sad statistic has, it seems, been surpassed already with 2012 set to be even worse.

This activity results in many “distressed assets” coming on to the market.  These assets are mainly industrial/commercial in nature, but can often involve a business’s investment or owner occupied residential real estate. Whether these distressed assets are worth buying is another thing. I’ve said elsewhere that this market has a long, slow and painful correction to come, is still overpriced and unaffordable for many.  Be wary of Mortgagee In Possession and Receivership sales.  You may think you’re getting a bargain but do lots of homework before you raise your hand to bid, or, pen in hand you sign, pressing hard on those three copies!

In speaking with more people “in-the-know” today already there are stories of residential sales made only 6 months ago, put back on the market, not under any sort of stress, just don’t like the street for instance, where owners have suffered substantial losses.  One was bought after Easter for $565,000 and sold again, 6 months later for $535,000. The apparent loss was $30,000, bad enough, but when you add the cost of purchase, stamp duty, legal fees, inspections etc and the cost of selling such as necessary repairs and maintenance, legal and agency fees,  the loss on sale ended up at no change out of $80,000.  After only 6 months, that’s a nasty outcome.

Tagged , , , , , , ,

DESPERATE AND DATELESS

Desperate investors hoping to recoup losses made here in Australia are looking at the sometimes miraculous returns being achieved in the depressed real estate markets of the United States of America.

I’ve been fortunate to have lived and travelled right across the US of A and whilst it’s an amazing country with great people it’s not a place for out-of-towners to buy real estate just at the moment.

Scammers are working out of the United Kingdom, all over Europe, South America and right here in Australia, successfully liberating millions of dollars from unsuspecting punters who believe their intricate web of lies.

Continue reading

Tagged , , , , ,

THE MARKET – CASE STUDY – 13 NOVEMBER 2012

Following discussions with a friend this morning  I agreed to produce a Comparative Market Analysis (CMA) to help him decide his next step. Keep. Sell, Rent.

There were so few sales in recent times within a 500 metre radius of his home that I had to increase the radius to a mile (1.6 kms) to gather sufficient evidence to produce a worthwhile CMA.

One house in the area struck me as a PRIME EXAMPLE of what is really going on in the market.

Continue reading

Tagged , , ,

BEACH AND POOL COLLIDE

You normally walk from the end of this street straight out onto a glorious, wide sandy beach. Council built this so you don’t have to bring your mountain climbing gear to go for a surf!

The only thing between the huge swimming pools (just behind the glass fences) and the ocean is a rock wall that may or may not survive the next Cyclone…

 

Tagged , , , ,

FOR SALE $5,000,000.00 (Land Optional)

Severe erosion along the world famous Mermaid Beach Millionaires Row here on the Gold Coast has exposed the last bastion, a 5 metre rock wall.  We’re just entering cyclone (read Hurricane) season Down Under so things aren’t looking good.

Adds a whole new meaning to the descriptor “absolute beachfront”. Walk out your back door and fall 15 feet ONTO the beach!

 

 

Tagged , , , ,

WILD WEST SYNDROME

I’ve been warning people for years about Mining Towns and, in some areas, they’re starting to listen.  I made a few phone calls today to see what’s happening at the coal face (oh dear, pardon the pun).

It’s as I predicted.  Rents are falling as mines bow under pressure to build Fly In Fly Out camps because workers, especially young ones earning big money, don’t want to live in the middle of nowhere.  What’s a young fella or lass to do?  Young guys especially have all the toys.  Jet skis, V8 Ute, Harley Davidson, and a dog named Butch on a very fancy leather lead.  You can’t parade the toys around a town of 1.500 people so they all head off to the Gold Coast or other Big Smoke to “splash their cash”.

Continue reading

Tagged , , , , , , ,

THE MARKET

I hope you’ve read the painfully honest research report in my Post “Research – Finally – The Truth”.

I’m still reading piles of rubbish telling us the market is sound with not a chance of falling any further and that there are “sparks” of a turnaround.

It’s not rocket science folks.  In capital city and regional newspapers today, except for mining towns (more on those in a minute) there are countless advertisements for properties for sale under the order of Receivers and Mortgagees-In-Possession.  When the market is healthy you just don’t see very many of these ads.

Continue reading

Tagged , , ,

ACE #4

Aspect, Contour and elevation continues.  I also used to an ACE in the Air Force!  Seriously.  Airspace Coordinating Element. A part of my role as a military air traffic controller was to ensure that Navy, Army, Air Force, “other” forces and units didn’t bomb, strafe or shoot each other, or civilians, out of the sky.  That’s about all I can say about that… Now, back to real estate, and again, in no particular order…

When considering a purchase there are hundreds of things to keep in mind, and I’ve mentioned quite a few already.  The list continues…

Poo.  Or more particularly, things to do with poo.  On your walk, cycle and/or drive around the area you’re thinking about buying in, look for sewerage pumping plant, breather pipes and other sewer infrastructure.  The local Council will also tell you where these things are.  Some of this plant can emit terrible smells either very occasionally, on a regular basis or 24/7.

Continue reading

Tagged , , , , , , , , , , , , , , , ,
%d bloggers like this: