Hilton Hotel SplurgeArticle by "Leading Light" 27 Mar 2013Job Loss and Your Mortgage

Hi – I’ve just banged in 3 articles from today’s press (wide acknowledgement of printed paper)…please, have a quick read, if you haven’t already, take your rose tinted glasses off and face the reality.

As I’ve said in past articles, “any fool can sell a dollar for sixty cents” and that’s exactly what’s happened with the Hilton Residences, and is happening everywhere else especially here on the Gold Coast.  I’m told, first hand or if second hand, easily checkable, of disaster after nightmare after “Oh My God, you lost how much?”

I’m sticking pins in myself trying to figure out why anyone in their right mind would buy ten x 2 bedroom apartments in that building.  Is real estate not all about Location, Location and dare I repeat myself for emphasis, Location?  The horror stories from guests and owners who sadly bought off the plan of the noise, the constant noise, drunks and other malcontents in the elevators, the shenanigans in the pool not to forget walking out into pools of vomit and girls pulling each other’s hair out in the middle of our so-called Night Club District.  You’ve got to be kidding me?  A wise investment at $700,000.00 each for a 2 bedroom apartment.  Must have been a very glossy brochure!

Anyway, read the article and come to your own conclusion – mine is, of course, the contrarian view, and those apartments will be like a slum and un-saleable in a few years…you read it here first and I stand by that.  Its just not a nice place to have an apartment.

Then there’s Andrew Bell – now I haven’t gone head-to-head with anyone on this blog before but I really have to question what he is on about.  He, and others like him, keep banging on about high clearance rates at auctions.  Sure, there are, or may be high clearance rates but at what cost to the Sellers – Ray White naturally get their commission no matter the sale price but many, many sellers are heart broken.  There’s the odd ‘miracle’ but I wonder just what the Hell has gone on with some of those sales…as soon as I can dig up more information of some ‘miracles’ I’ve seen I’ll let you know.

There was one example I was involved in years ago that skewed the sale price.  The Buyer was from overseas.  I let buyer and seller negotiate the inclusion of all the furniture, fixtures and fittings, a boat, two cars (expensive) and other ‘toys’.  I told the Buyer that if he put all of that on the Contract there would be stamp duty implications and I made sure he consulted his lawyer, which he assured me he did.  The subsequently reported sale price skewed the market in that small area and had tongues wagging – made my job when listing new places a nightmare as I couldn’t tell people intimate details of the deal and that 30-35% of the reported sale had nothing to do with the house.

I have no idea where he gets a trebling of sales over the same period last year.  Where? Show me!  Please.

Commercial leasing the strongest in 6 years!  Fairyland – I’ve direct contacts in Commercial and its a basket case in most areas – I attend Commercial Auctions, many of which are conducted by his Offices – NO RESULT, the Auction Signs taken down and replaced with FOR SALE signs, which, like so many on the Coast, will weather to a dull grey over time…

“A resurging stock market” – I’ve been a day trader and this market is so dangerous one would be well advised to “stand aside” as it could go anywhere…just look at Commonwealth Bank at near (and wobbling) $70.00 for goodness sake – 40% rise since May last year – that’s just crazy stuff.

He goes on to talk about Sanctuary Cove, Hope Island and Coomera.  My goodness gracious – 3 areas designed to lose money – ask me and I’ll tell you!  I guess I’ll give you one to chew on – a certain type of waterfront land at Sanctuary Cove used to sell for $1m more than 20 years ago… Its price today – $1m.  STAR Performer!

The last article tells us what we already know – that mortgage stress is rising, NOT FALLING… people are really scared.  Another article from a reliable source told me that people are, on average with many of the Banks, up to 20 months AHEAD with their Mortgage payments as a hedge against job loss or a reduction in hours worked.

Anyway – enough doom, gloom and ripping those rose-tinted glasses off yer face!

Pray for the best, prepare for the worst!

til next time…

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