Comments
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CLI have lived in Sydney for 18 months now. I have seen this movie before elsewhere. (House prices / affordability). I have however come to the realization that saying the emperor is naked here causes problems.
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TSGrant is more bearish than Minack!
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GCOpposition Labor party will reform negative gearing and the capital gains tax discount to reduce attractiveness of investment, there is a significant probability they will gain power.
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SVery good chat. Pity everyone is only talking about the big banks & not A-Reits
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RSRe interest only loans - nearly all investors are interest only for negative gearing and other tax reasons. My own PPOR mortgage, I'm interest only and putting cash in offset for tax & acct. purposes
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RSWhat are the leading employment indicators to watch out for? I agree, unemployment will lead to mortgage stress - but the RBA will cut rates to in response.
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mcNote well Aussie home loans are full recourse, no handing back the keys to bank and waltzing off. Aussie's will die in the ditch to keep servicing the loan. Will still crash but slower I reckon.
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PS1 in 4 Owner Occupier mortgages and 2 out of 3 investor mortgage loans are on interest only payment structure. It isn't going to take too much of a shock with debt at record levels to income/GDP.
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NHGreat interview. Would be nice to get an opinion on how negative gearing has propped up the Aussie housing market. No mention of this here or from Tepper's interview.
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NSGreat discussion. I'd be interested in an in-depth analysis of how the Australian govt prevents the Aussie banks going under if/when the housing market falls. The "big 4" are enormous relatively.
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CCThank you for pointing out and defining the nuance Grant.
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GCGerard is of the opinion, like other Australian commentators, that there needs to be a shock such as rising unemployment for a housing correction to start. This is at odds to people like J. Tepper.
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CMBloviate, bloviate, bloviate... Reminds me of the great know it all at the corner pub.