First homebuyers screwed, in one year Plus turning shrewd
My examples are for first homebuyers...
other market participants will not fit into this category.... EG, traders, fixed interest rate holders, buffs, long term holders, renovators, big cats developers, long term investors, developers, king pins in operation, multi home owner_______ etc etc etc....
(mack-a-dad-unk-)... this means you.... you big fish in a small pond......
Ok... Today I went out for lunch with my great mate... Last year near the peak he was on the brink of buying... 'I forced him out'... today he told me he bought... at first ise outraged... rampaging... lost for words... not happy... the story he told started to unfold much better than what it was even 6 months ago (when he wanted to buy)...
his circumstances were not all about money etc... family etc...
Ok... house- went for auction at 300k, 3 accepting bidders... all fell through on finance... after that, then went through on market at 270k on open home...My buddy put bid in at 230k... came back at 240k...then 233k... "sell".... I went around and seen the house and saw what potential this house held...
not good area in Christchurch... shirley.... surrounded by state owned... best house in two blocks... 3 bedroom, two double rooms... garden, newish kitchen... 300 per week for 30 years (to pay house off in that time (including interest).... rent (otherwise) half that plus two rooms rent... so perhaps my buddy scored...
Im convinced he will go floating on my advice... I will free carry him if im wrong, its just not possible (with one more rate cut this year)...
....
So, from one year onwards, first homebuyers (in particular) will become screwed turning shrewd as predicted because the market topped out, and in some circumstances houses are being sold on a forward basis of slashed prices of 10% already being factored in... ie... the sellers save the wait, while reinvesting their money at the current deposit rate and making money while market is in limbo... so factoring in further cuts in housing prices as a given with a shot of making money back through reinvestment.... (smart move)... My dad made the same tough call... valued 610k... sold 500k flat... thats almost 50k (b4 tax) next year while market likely continues to fall, or at major major major best market goes sideways....
My buddy will be worse off in the near term... much better off in the long term, perhaps indifferent if all the dots can fall into place... IE renting both rooms, interest rates continue to fall, suburb already sold down and factoring in further slashes (not like that of guns and roses) ....
I hope he is still prepared for prices to fall much further...
In general I have been learning much about shocks in the market impacting on interest rates, output of the economy, LM, and IS curves (its a given bar nothing) I will bet on it if a buff is prepared to take it up.....
EG, sell it to the grandma (off current info) type stuff...
info does change... so if you are that sure (buff) lock it in now...
next year (with further rate cuts, which are a given), it will be a great time to buy...
Minimoke reckons Im A talker... reckons I will stand by and watch the rebound... reckons all sorts............... you watch buddy...
first home, looking for 3.... and those that cant do teach, right?
With a name like that you should become maximoke...
haha... all in good notion.... good luck to all, no matter how trigger happy you are... bang bang... when are you first homebuyers going to pull the trigger????
I hope not for at least another year...!
Re-address the situation in 6 months, perhaps things will change then...?
hummm.....
bang bang...
when?
:cool:
.^sc