SQM’s Louis Christopher and Kochie featured on Sunrise today to talk about the future of Real Estate in Australia. Louis Christopher explained how auction clearance rates are actually calculated, while Kochie talked viewers through the credit crunch and how Australia has the most expensive property in the world.
The video segment can be watched here.
Wow what a half baked message of deceitful statistics and false information.
In particular I cant believe Koshie lies about the US non recourse loans like that. His whole commentary was pretty amateur.
ah well I suppose it reassures the indebted. the other thing I don’t get is how they can suggest that the prices will stop falling at 25%. I’d suggest at 25% drop our economy is going to be a wreck. nothing to stop the fall after that, its still poor value for money.
check out tightening credit having an effect in china.. 63% drops in 3 months.
http://globaleconomicanalysis.blogspot.com/2011/11/home-prices-crash-625-since-september.html
good luck to holders 🙂
Ah yes…! The ol’ U.S. Non-Recourse Loans and its’ different here victory exclaimation! Well I’ve posted this here one or two times before, on many another blog (sorry admin, I do have others), and I’m going to copy and paste it here again, and claim I am better researched and smarter than Koshie…
Non-Recourse States
Koschie said our prices are the most expensive in the world but in the say sentence he did suggested we won’t see those significant drops in prices like other countries, that there is a major difference here that Aussies just can’t walk away like the US and UK.
Will that be enough to prevent significant falls of house prices here?
or will it just leave greater financial ruin to the individual when, if we do get those significant falls?
My direct manager, and whom I report to, is on a years to secondment to Australia from his native Detroit USA.
After having a friend at a late night debate on the housing use the we are different/’non-recourse’ loans approach, I decided to ask my Manager directly whom is also a home owner in Detroit.
The question was ‘If you cannot service your home loan in the USA, can you hand in the keys and walk away’ ???
His answer was a swift and emphatic NO ! Some states have differing laws, but all of them will result in your credit rating being trashed. He was adamant that you do not walk away lightly and will have lifetime consequences.
Yes, I’d have thought the fact we can’t walk away from an underwater mortage would mean the contraction here may take longer to eventuate but would be far more severe once it takes hold. If you can walk away then that would immediately free up discretionary spend however if you are in negative equity over here logic would suggest that every single discretionary cent would be diverted into paying down the mortgage at the expense of discretionary items, which would result in a more severe negative feedback loop once it kicks in.