It's the Saturday Open thread. Here We Go Stormers!
7 comments:
Anonymous
said...
In our road in Milnerton there are now 3 families defaulting for their third month in a row on their bond repayments. School fees and rates/water accounts are behind by at least 5 months in all 3 cases.
And in all 3 cases retrenchment was'nt the cause. Even though they still have a job,it seems that some people are just not paying - full stop. What's happening to this society ?
In my apartment complex we have 3 units not paying levy, for years now. The managing agent as placed these units on auction after a lengthy legal process. By law the body corporate can actually sell the property off to recover the levies. Approx 85% of the people living here are tenants, and come AGM time, you need a certain percentage of the owners to rock up just to legally have the meeting. It's difficult and you have to nag people each time just to sit there once a year. It seems that the recent boom has restulted in specuvestors and the like seeing property as just another income stream. Gone are the days of caring landlords and the search for respectable tenants.
Extract "The survey has also shown a significant increase in the average time homes spend on the market prior to sale. This has gone from a previous 15 weeks and six days to 19 weeks and one day, in the first quarter of this year. " taken from RealEstateWeb's article "More owners selling their homes for less" ... need I say more
It's like the party's over, some people drank too much, forgot what they did and now they don't care and just want to go home and sleep it off. Problem is the baby is on its way...
Landlords are scared, and worse still inexperienced. Books like "Rich Dad Poor Dad" created an entire army of these "specuvestors" you refer to, who were keen to make money but were never passionate about property itself and now they are left with the baby...
Its going to be interesting to see how this effects the approach to property of Generation Y (born 1985 to 2010) as they start to mature into home buyers...
So I see the interest rates have been left unchanged for now, but is expected to start to rise by the end of the year.
Rising rates, coupled with little hope of price gains, will start to squeeze many more owners. Lots of people are living on credit to finance the gap between income and budget. Rising rates will hurt bad forcing many to sell. Or try to sell.
The supply of sellers will go up and demand down. You know what that means.
Ah but Jules, it's no secret that the items most people own is directly proportional to how much they can loan from the bank. The biggest contributor to the dead property market is not the price, but rather the bank's tight lending criteria. People don't care how much they pay, most have no clue and couldn't care less about the value, as long as they can get what they want. It shows serious flaws in the average Westerner's financial discipline, manipulated by the government and the Fed for financial gain. Sure, interest rates will rise a little and a few more will foreclose. The banks however will cater for that by lowering their lending criteria to rope in some more stable bonds to counter the odd loss through insolvency. There is a huge group of buyers out there just waiting for the banks to give them that bond.
They [Gen Y] will do exactly the same thing as all their type of generations did before them. Nomad generations [Gen X] always pay too much for property courtesy of the Idealist generation [baby boomers]. This cycle has been going on a lot longer than you think :). Property will be valued fairly by the time Gen Y starts buying [After Gen X has sorted out the disasters wrought by the boomers and their parents]
Spring is far away well into the 2020's, now its winter with economies crashing, revolutions, wars long predicted. Expect a low point in 2017 with most likely an expanded ME war. Expect a rewrite of the worlds monetary system a la Bretton Woods with gold a major part [we going back to harder money sonny].
Sit in commodities and PM's until the credibility of property to give a return has vanished, CJ is bullish and you have seen how the impact of the Greater Depression will affect politics and policy here. If you bought in the last years of the bubble consider it an expensive education in cycles and fiat currency, if you didnt then no worries as notional value is wiped out; its still a home.
Your classic bubble graph has illuminated the trajectory and emotions of our housing bubble to perfection. Who says this time is different as we exit the bull cr@p, sorry bull trap. What other black swan awaits and then in the immortal words of GW Bush "This sucker's going down".
7 comments:
In our road in Milnerton there are now 3 families defaulting for their third month in a row on their bond repayments.
School fees and rates/water accounts are behind by at least 5 months in all 3 cases.
And in all 3 cases retrenchment was'nt the cause.
Even though they still have a job,it seems that some people are just not paying - full stop.
What's happening to this society ?
In my apartment complex we have 3 units not paying levy, for years now. The managing agent as placed these units on auction after a lengthy legal process. By law the body corporate can actually sell the property off to recover the levies. Approx 85% of the people living here are tenants, and come AGM time, you need a certain percentage of the owners to rock up just to legally have the meeting. It's difficult and you have to nag people each time just to sit there once a year. It seems that the recent boom has restulted in specuvestors and the like seeing property as just another income stream. Gone are the days of caring landlords and the search for respectable tenants.
Extract "The survey has also shown a significant increase in the average time homes spend on the market prior to sale. This has gone from a previous 15 weeks and six days to 19 weeks and one day, in the first quarter of this year. " taken from RealEstateWeb's article "More owners selling their homes for less" ... need I say more
Good point "Anon number 2"!
It's like the party's over, some people drank too much, forgot what they did and now they don't care and just want to go home and sleep it off. Problem is the baby is on its way...
Landlords are scared, and worse still inexperienced. Books like "Rich Dad Poor Dad" created an entire army of these "specuvestors" you refer to, who were keen to make money but were never passionate about property itself and now they are left with the baby...
Its going to be interesting to see how this effects the approach to property of Generation Y (born 1985 to 2010) as they start to mature into home buyers...
So I see the interest rates have been left unchanged for now, but is expected to start to rise by the end of the year.
Rising rates, coupled with little hope of price gains, will start to squeeze many more owners. Lots of people are living on credit to finance the gap between income and budget. Rising rates will hurt bad forcing many to sell. Or try to sell.
The supply of sellers will go up and demand down. You know what that means.
Ah but Jules, it's no secret that the items most people own is directly proportional to how much they can loan from the bank. The biggest contributor to the dead property market is not the price, but rather the bank's tight lending criteria. People don't care how much they pay, most have no clue and couldn't care less about the value, as long as they can get what they want. It shows serious flaws in the average Westerner's financial discipline, manipulated by the government and the Fed for financial gain. Sure, interest rates will rise a little and a few more will foreclose. The banks however will cater for that by lowering their lending criteria to rope in some more stable bonds to counter the odd loss through insolvency. There is a huge group of buyers out there just waiting for the banks to give them that bond.
@HPSA
They [Gen Y] will do exactly the same thing as all their type of generations did before them. Nomad generations [Gen X] always pay too much for property courtesy of the Idealist generation [baby boomers]. This cycle has been going on a lot longer than you think :). Property will be valued fairly by the time Gen Y starts buying [After Gen X has sorted out the disasters wrought by the boomers and their parents]
Spring is far away well into the 2020's, now its winter with economies crashing, revolutions, wars long predicted. Expect a low point in 2017 with most likely an expanded ME war. Expect a rewrite of the worlds monetary system a la Bretton Woods with gold a major part [we going back to harder money sonny].
Sit in commodities and PM's until the credibility of property to give a return has vanished, CJ is bullish and you have seen how the impact of the Greater Depression will affect politics and policy here. If you bought in the last years of the bubble consider it an expensive education in cycles and fiat currency, if you didnt then no worries as notional value is wiped out; its still a home.
Your classic bubble graph has illuminated the trajectory and emotions of our housing bubble to perfection. Who says this time is different as we exit the bull cr@p, sorry bull trap. What other black swan awaits and then in the immortal words of GW Bush "This sucker's going down".
I love all the drama of financial folly.
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