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 Post subject: Re: Ominous signs in Australia
PostPosted: Fri Oct 13, 2017 1:59 am 
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Some news I posted a while back that shocked me at the time but was widely unreported.
Making news today:

Quote:
Let's start with Westpac chief executive officer Brian Hartzer.

First, he confirmed the little-known but startling fact that half of his $400 billion home loan book consists of interest-only mortgages.

Yep, half. Of $400 billion. At one bank. Oh, and ANZ, CBA and NAB are all nearly at 40 per cent interest-only.

Mr Hartzer went on to make the banal statement: "We don't lend to people who can't pay it back. It doesn't make sense for us to do so."


Quote:
ANZ chief executive officer Shayne Elliot repeated Nr Hartzer's mantra, saying: "It's not in our interest to lend money to people who can't afford to repay."

Recall, this is the man who on ABC's Four Corners said that home loans weren't risky because they were all uncorrelated risks (the chances that one loan defaults does not affect the chances of others defaulting).

That is a comment that is either staggeringly stupid or completely disingenuous.

Messers Harzter and Elliot must take us all for suckers.



Quote:
To put it in context, there appears to be in the neighbourhood of $1 trillion of interest-only loans on the books of Australian banks.

I say "appears to be", because reporting requirements are so lax it's hard to know for sure, except when CEOs cough up the ball, like this week.


http://www.abc.net.au/news/2017-10-13/p ... ng/9046362

A typical interest only period is 5 years, where will interest rates be in 5 years when they go onto paying the interest and capital?


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 Post subject: Re: Ominous signs in Australia
PostPosted: Fri Oct 13, 2017 2:45 am 
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Quote:
NAB has cut its Sydney house price growth expectations this year, saying the market is slowing faster than it expected at its last forecast three months ago.
Sydney's median house price fell 1.9 per cent in the three months to September


1:35pm
http://www.smh.com.au/business/markets- ... z03fa.html


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 Post subject: Re: Ominous signs in Australia
PostPosted: Wed Oct 18, 2017 10:21 pm 
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Quote:
Entry-level jobs are disappearing from the Australian labour market, and five entry-level workers are now competing for each advertised job, a report has found.

https://www.theguardian.com/business/20 ... ket-report

Quote:
•For every entry-level job, there are 4.8 applicants, Anglicare report reveals
•Job-seekers report going months without getting interviews
•1.1 million people are underemployed, an increase of 225,000 from last year


Quote:
Last month, 54,000 full-time jobs were added, and the Australian Bureau of Statistics projects the unemployment will drop from 5.6 per cent.

There has been a consistent drop in the number of available entry-level jobs over the past five years.

In 2012, there were regularly more than 60,000 level five entry-level jobs available per month across the country.

This year, that number has plummeted by more than 10,000 per month.

In that time, Australia's population has increased by nearly 2 million people.



http://mobile.abc.net.au/news/2017-10-1 ... ys/9062620


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 Post subject: Re: Ominous signs in Australia
PostPosted: Thu Oct 19, 2017 5:46 pm 
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It either UP

Quote:
Sydney market to grow by up to 8 per cent, Melbourne 12 per cent in 2018: SQM Research

https://www.domain.com.au/news/sydney-m ... 19-gz1r18/


or DOWN

Quote:
Slump in Sydney housing market to last until mid-2018: SQM research

http://www.news.com.au/finance/real-est ... 6040507658

Seems to me you cant predict the headlines or the property prices

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 Post subject: Re: Ominous signs in Australia
PostPosted: Fri Oct 20, 2017 4:42 am 
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http://www.abc.net.au/news/2017-10-20/h ... ay/9061854
Quote:
The Holden production line in northern Adelaide has shut down for the last time, ending 69 years of Australian-made car manufacturing.


Car manufacturing ended in Victoria recently, now the last in Australia closed over in Adelaide.
The ASX hits highs not seen since the GFC, business conditions are improved though no wage growth in sight at all (in fact real/inflation adjusted wage decline), unemployment is down including full time jobs. Mining has recently started to increase expenditure but metal prices have been up and down. At the same time property value declines have spread from Perth to Darwin, Brisbane and Sydney in about that order of severity while people are hugely in debt and retail spending has collapsed. Property prices did decline circa 2013 but not by much and jumped back up crazier than ever.


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 Post subject: Re: Ominous signs in Australia
PostPosted: Fri Oct 20, 2017 8:54 am 
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Blindjustice BATONEFFECT wrote:
Property prices did decline circa 2013 but not by much and jumped back up crazier than ever.

It's more of a slow moving train wreck.

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 Post subject: Re: Ominous signs in Australia
PostPosted: Fri Oct 20, 2017 9:30 am 
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catbear wrote:
Blindjustice BATONEFFECT wrote:
Property prices did decline circa 2013 but not by much and jumped back up crazier than ever.

It's more of a slow moving train wreck.

more a rollercoster

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 Post subject: Re: Ominous signs in Australia
PostPosted: Mon Oct 23, 2017 10:57 am 
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Quote:
The latest release of data from the 2016 census shows that the gig economy, characterised by temporary jobs and part-time contracts, has taken hold in Australia.

“The gig economy is on the rise,” says demographers McCrindle in an analysis of the census data.

Today, one in three working Australians are employed part-time, up 3% since 2011.

A quarter of a century ago, just one in 10 were employed part-time.

One in five (22%) working men are tradesman or technicians with the three most popular male-dominated occupations being electricians, carpenters/joiners and truck drivers.

For women, the top occupations are registered nurses, general clerks and receptionists.

The biggest fall in employment by industry is manufacturing, which has seen the loss of 219,141 workers in the five years since the previous census.


https://www.businessinsider.com.au/cens ... ia-2017-10


Quote:
The fastest-growing careers in Australia

“There was a 27 per cent increase in fitness instructors, a 25 per cent rise in the number of beauty therapists and a 23 per cent increase in bar attendants and baristas,” Census program manager Bindi Kindermann said.

Overall more than 80 per cent of Australian workers were employed in the services industry including health care, education and retail. This is up slightly from 78 per cent in 2011.

The jobs with the highest percentage growth were sales support workers, domestic cleaners, early childhood teachers, enrolled and mothercraft nurses as well as ICT support and test engineers.


http://www.heraldsun.com.au/news/specia ... 96ec64f74c

If/When the bubble bursts .......


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 Post subject: Re: Ominous signs in Australia
PostPosted: Fri Oct 27, 2017 5:24 am 
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Quote:
If you take the median house price in 1980 and raise it by both the increase in disposable household incomes and the expanded borrowing capacity enabled by the reduction in mortgage rates to June 2017, you will find that today's house prices are only 3 per cent overvalued, writes AFR contributor Christopher Joye.

That's based on research by IFM chief economist Alex Joiner. But here's the rub: this analysis crucially assumes that today's all-time record lows in mortgage rates persist forever.

The Reserve Bank of Australia reckons its "neutral" cash rate is about 2 percentage points higher than the current 1.5 per cent rate.

If Dr Joiner then assumes that mortgage rates lift by 1 per cent to 2 per cent, his model implies that current home values are 11 per cent to 20 per cent overvalued, which happens to book-end our forecast range for the next eventual correction.


http://www.smh.com.au/business/markets- ... z993m.html

be interesting to know the average number of people in a household working or how many hours all workers in a household worked in 1980 versus today


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 Post subject: Re: Ominous signs in Australia
PostPosted: Fri Oct 27, 2017 2:58 pm 
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You can be damned sure Bruce and Sheila are working and commuting 1.5 to 2 times the number of hours they did in 1980


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 Post subject: Re: Ominous signs in Australia
PostPosted: Tue Oct 31, 2017 2:52 am 
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Quote:
Australian new home sales took a hit last month, sinking to near 4-year low
Australian new home sales tumbled in September, driven by a large decline in apartment purchases.


Image
https://www.businessinsider.com.au/aust ... er-2017-10


Quote:
Australian auction clearance rates slide as a flood of properties go under the hammer
Read more at https://www.businessinsider.com.au/auct ... SA3kOMT.99

https://www.businessinsider.com.au/auct ... se-2017-10


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 Post subject: Re: Ominous signs in Australia
PostPosted: Tue Oct 31, 2017 1:21 pm 
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Is this narrative about the problem being confined to apartments supported by the facts? I'm sure we saw similar stories being peddled in Ireland pre-collapse.


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 Post subject: Re: Ominous signs in Australia
PostPosted: Wed Nov 01, 2017 7:08 am 
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DSE3Br wrote:
Is this narrative about the problem being confined to apartments supported by the facts? I'm sure we saw similar stories being peddled in Ireland pre-collapse.


There has been more and more stories about the bubble bursting lately but almost as many against. No real consensus here. Something about these articles from today seems different though

Quote:
There is now a persistent and sharp slowdown unfolding", ending 55 years of unprecedented growth that has seen home values soar by more than 6500 per cent, UBS economists wrote in a note to clients on Thursday.

http://www.smh.com.au/business/property ... zclp4.html
Quote:
'Significant turn of events': Sydney property prices suffer quarterly fall

http://www.smh.com.au/business/property ... zccpv.html
Perth article stating that the price drops are continuing in Perth but 'spreading to Sydney'
http://www.perthnow.com.au/news/western ... a024bc5fc7
This article has a picture of a boxer knocked out lying down
https://www.businessinsider.com.au/aust ... bs-2017-11
This shows property being demolished
https://www.businessinsider.com.au/sydn ... ed-2017-11

Quote:
MELBOURNE’S housing market is “resilient”, but something just happened in Sydney which experts have described as “significant”

http://www.news.com.au/finance/economy/ ... d87ec18b51

Comments

How about this...the ASX has hit a high not seen since the GFC!!! http://www.smh.com.au/business/markets/ ... zcipg.html

Quote:
The big four banks also provided support, with ANZ, NAB and Westpac climbing in the vicinity of 0.6 per cent, while CBA edged 0.1 per cent higher. NAB releases annual profits tomorrow.


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 Post subject: Re: Ominous signs in Australia
PostPosted: Wed Nov 01, 2017 9:37 am 
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DSE3Br wrote:
conork wrote:
FT wrote:
Meriton’s Harry Triguboff on being Australia’s second-richest man

Over the past five years Meriton has benefited from Chinese buyers, who account for about half of all unit sales. Beijing is making it harder for people to take their money out of China by imposing tougher capital controls. This prompted Meriton to provide vendor financing loans to Chinese buyers, totalling about A$190m in April.


The big 4 banks also pulled back lending to Chinese due to risks they saw. This prompted Triguboff to set up "bank of Triguboff".

I wonder what kind of security he has? :shock:


Here is the latest from Harry

Quote:
A promise by the NSW government to protect renters' rights has the premier facing a potential showdown with the city's richest man who is threatening to stop constructing thousands of rental properties in a move that could drive up rents across Sydney.

Following a promise by the opposition to extend the default length of rental leases and limit the frequency of increases, the state government last week announced it had been developing its own renters' rights reforms to be brought into parliament early next year.

"I will sell all the rental properties, which I will vacate and I will not build any new ones," Mr Triguboff said to The Australian Business Review on Wednesday. "If I don't get the answers [about any policy impact on investors], I will not renew any lease."

http://www.smh.com.au/nsw/meriton-warns ... zcx3p.html


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 Post subject: Re: Ominous signs in Australia
PostPosted: Thu Nov 02, 2017 7:06 am 
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House sells for over 1 million at auction last month:
https://www.domain.com.au/18-20-alexand ... 2013894647

Now up for rent @ 420 a week:
https://www.domain.com.au/18-20-alexand ... 8-11747084

Over 30 years a mortgage of approx $360,000 will cost 420 a week.
https://www.anz.com.au/personal/home-lo ... epayments/

Now factor in all your costs.....................


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