It's the Stormers Vs Bulls Saturday edition of the Open Thread!
9 comments:
Bean Counter
said...
Is this the calm before the storm? We bears have gone a bit quiet, waiting for bad news. But it seems the bulls are also a bit thin on bull-dust (or whatever they snort to get high): according to Alexa.com (stats tracking site), Realestateweb's traffic is down 30% over the last three months. Property porn losing its appeal?
This seems to back up my opinion that bulls and bears are trying to wait each other out. Bulls refuse to "give them away", and cling to a delusions that "things will return to normal". Bears wonder when the home-ownerists will allow rates to start rising and squeeze the hot air out of the specuvestors.
I know which side is going to crack first. Ain't no bull.
I think the next 12 months will provide a clear indication on where the cape property market is heading. If, a year after the SWC, the market is still hanging on then the bears might need to take the plunge into the market, i.e. no lower prices.
But if a slide sets in then all bets are off on how low it can go.
Personally, I think there will be some post SWC foreign buyers and that will help the market. Overall: flat prices against mild overall inflation for the next few years.
@Jules - which foreigners? Less than 10% are coming down to CT.
@BC - realestateweb is a joke. If I paid for advertising there I could put up an article about the size of my balls and they would not bat an eyelid.
Personal prediction: More bank auctions at the "correct market price", with sellers continuing to ask their high prices without getting them. Lots of "subject to sales" at inflated prices, only to fall through when the "subject to" buyers cannot get their price on their property.
All bets are off if the SARB raises the interest rate after the world cup.
JoelW, I love how they describe the biggest national bubble in the biggest international bubble since the Depression as good news.
Lookout on the Titanic: "Captain! An iceberg!"
Captain: "Hooray! We were just starting to run low on ice cubes in the First Class lounge!"
I must agree with you that Jules' auslanders are not going to buy anything. Those who do come are going to find a cold, wet, windy city, no mountain, no allowance made for pedestrians in wet weather, insane drivers and quite possibly power cuts. It's just not going to happen, Jules.
Still no more shopping basket in the weekend argus this week - 3 weeks in a row it has been pulled now. Looks like inflation is back and someone doesn't want us to know.
So higher bond rates on the way.
According to this guy the UK and Oz house markets have still further to fall - I suspect the SA market wasn't on his radar but if it was he would see similar bubble patterns still unresolved as in those 2 markets.
As he says, their research shows that each of the last 30 bubbles over history follows the same collapse to at least the long term trend - SA is still far from that.
So there is still more downward pressure to come - if inflation is back then that will certainly help the real price to drop faster, but the subsequent bond rate increases will obviously hurt the over extended borrowers so nominal price falls will also be inevitable
Hello All, One point that needs to be considered regarding foreign possible buyers is that the idea of having homes scattered all over the world is not as vogue as it was 5 years ago. I live in Europe and observe my fellow citizens and their habits that are becoming more and more conservative. The idea of spending many hundreds of thousands of Euro's or in some cases over a million Euro's, and the rest - in a developing market on the other side of the world, as a second home is now an unusual habit. Property on show, far from home bases, in Uraguay, Thailand, various ocean islands ect, are not getting a deep look into from Europeans as property value skeptisism is rife and there are no financial institutions that back such activity anymore. I speak here for the Europeans as i think they could be South Africa's target, rather than American's or Asians. So i suggest you all enjoy the world cup as a football tournament and not a property exposition. People will come and visit for the football and even if they could buy a home on the beach for 500' 000 Euro on the other side of the world - they would be hard pressed to do it as they would need that kind of money in cash as their local banks won't lend it to them. All in all, i can see a "South African who made it big in Europe, with some spare cash", buying a piece of nostalgia in CT, but anyone else - i am not convinced. So i would say that the usual steady flow of JHB people moving to the Cape and buying a home with a hard earned JHB saving cach'e will continue although at a slower pace than before otherwise it's the Capetonian property sect buying and selling to one another, as they always have - and we know what the final result of that will be. Congratulations to the bull's for stalling your correction for so long. I am sure that a lending rates increase, a depreciation of the rand by circa 20% and some seller fatigue will make property prices in Cape town a little more sensible to the observer. However to make the prices more sensible to the CT citizen - i would say hyper inflation effects on salary adjustments may help. Good luck!
In the UK market notice there was a nice bear trap on the way up and it appears we are now at the end of the bull trap on the way down - a classic crash scenario unfolding in the usual way.
9 comments:
Is this the calm before the storm? We bears have gone a bit quiet, waiting for bad news. But it seems the bulls are also a bit thin on bull-dust (or whatever they snort to get high): according to Alexa.com (stats tracking site), Realestateweb's traffic is down 30% over the last three months. Property porn losing its appeal?
This seems to back up my opinion that bulls and bears are trying to wait each other out. Bulls refuse to "give them away", and cling to a delusions that "things will return to normal". Bears wonder when the home-ownerists will allow rates to start rising and squeeze the hot air out of the specuvestors.
I know which side is going to crack first. Ain't no bull.
I think the next 12 months will provide a clear indication on where the cape property market is heading. If, a year after the SWC, the market is still hanging on then the bears might need to take the plunge into the market, i.e. no lower prices.
But if a slide sets in then all bets are off on how low it can go.
Personally, I think there will be some post SWC foreign buyers and that will help the market. Overall: flat prices against mild overall inflation for the next few years.
http://property.iafrica.com/propertynews/2422022.htm
not according to these guys.
@Jules - which foreigners? Less than 10% are coming down to CT.
@BC - realestateweb is a joke. If I paid for advertising there I could put up an article about the size of my balls and they would not bat an eyelid.
Personal prediction: More bank auctions at the "correct market price", with sellers continuing to ask their high prices without getting them. Lots of "subject to sales" at inflated prices, only to fall through when the "subject to" buyers cannot get their price on their property.
All bets are off if the SARB raises the interest rate after the world cup.
JoelW, I love how they describe the biggest national bubble in the biggest international bubble since the Depression as good news.
Lookout on the Titanic: "Captain! An iceberg!"
Captain: "Hooray! We were just starting to run low on ice cubes in the First Class lounge!"
I must agree with you that Jules' auslanders are not going to buy anything. Those who do come are going to find a cold, wet, windy city, no mountain, no allowance made for pedestrians in wet weather, insane drivers and quite possibly power cuts. It's just not going to happen, Jules.
Still no more shopping basket in the weekend argus this week - 3 weeks in a row it has been pulled now. Looks like inflation is back and someone doesn't want us to know.
So higher bond rates on the way.
According to this guy the UK and Oz house markets have still further to fall - I suspect the SA market wasn't on his radar but if it was he would see similar bubble patterns still unresolved as in those 2 markets.
http://video.ft.com/v/79128759001/Apr-19-Jeremy-Grantham-on-bubbles
As he says, their research shows that each of the last 30 bubbles over history follows the same collapse to at least the long term trend - SA is still far from that.
So there is still more downward pressure to come - if inflation is back then that will certainly help the real price to drop faster, but the subsequent bond rate increases will obviously hurt the over extended borrowers so nominal price falls will also be inevitable
Talking of bubbles:
http://www.marketoracle.co.uk/Article19562.html
Hello All,
One point that needs to be considered regarding foreign possible buyers is that the idea of having homes scattered all over the world is not as vogue as it was 5 years ago. I live in Europe and observe my fellow citizens and their habits that are becoming more and more conservative. The idea of spending many hundreds of thousands of Euro's or in some cases over a million Euro's, and the rest - in a developing market on the other side of the world, as a second home is now an unusual habit. Property on show, far from home bases, in Uraguay, Thailand, various ocean islands ect, are not getting a deep look into from Europeans as property value skeptisism is rife and there are no financial institutions that back such activity anymore. I speak here for the Europeans as i think they could be South Africa's target, rather than American's or Asians. So i suggest you all enjoy the world cup as a football tournament and not a property exposition. People will come and visit for the football and even if they could buy a home on the beach for 500' 000 Euro on the other side of the world - they would be hard pressed to do it as they would need that kind of money in cash as their local banks won't lend it to them. All in all, i can see a "South African who made it big in Europe, with some spare cash", buying a piece of nostalgia in CT, but anyone else - i am not convinced. So i would say that the usual steady flow of JHB people moving to the Cape and buying a home with a hard earned JHB saving cach'e will continue although at a slower pace than before otherwise it's the Capetonian property sect buying and selling to one another, as they always have - and we know what the final result of that will be. Congratulations to the bull's for stalling your correction for so long. I am sure that a lending rates increase, a depreciation of the rand by circa 20% and some seller fatigue will make property prices in Cape town a little more sensible to the observer. However to make the prices more sensible to the CT citizen - i would say hyper inflation effects on salary adjustments may help. Good luck!
In the UK market notice there was a nice bear trap on the way up and it appears we are now at the end of the bull trap on the way down - a classic crash scenario unfolding in the usual way.
http://www.housepricecrash.co.uk/indices-nationwide-national-inflation.php
Expect SA's bull trap blip to turn any day - maybe post World Cup might just do it when the penny drops that the cavalry aren't coming.
should be shit-stormers vs bulls open thread lol
Post a Comment