Sydney investor led housing bubble irrefutable

October 13, 2014 admin Australian Housing, Sydney Housing Bubble 84

New lending finance data released by the Australian Bureau of Statistics (ABS) today show the Sydney property bubble is now undeniable as it continues its dangerous acceleration – unchecked.

Investors are starting to feel the strain as they fight each other for tenants in an oversupplied marketplace. With August figures showing 60 percent of all new home loans in NSW is for the purchase of an investment property, the highest ever, rents are starting to fall. According to the Domain Group, apartment rents have dropped below $500 a week to $495. Rents for houses remain static at $510 a week.

Rents are also falling in Perth and Canberra, while rents remain static in all other states – failing to keep up with inflation.

» Change in the wind for Sydney’s rental market – The Domain, 10th October 2014.




84 Comments

  1. @ Admin

    Any chance you could rejig that graph so it’s got a logarithmic scale on the Y axis: That will show how severe the mortgage commitments are. It will show that the $25million pilled on by NSW in the two years between 2012-2014, took 10 years to occur between 1992 and 2002.

    This chart clearly shows Melbourne and Sydney are out of control, while Qld and WA are playing the game, and SA is flatlining:

    I’m surprised about SA, flat finance commitments, but rising prices, that can only mean falling volume… Oh, hang on, we’ve had a couple of agents go under recently….& rental managers failing to pay their bills on time and under pressure….and the construction industry keeps loosing major players…..etc. etc. Watch for SA to hit reverse harder at first than the other states as reality sets in.

    Again, when this hits reverse it is going to be spectacular.

  2. Let the bubble burst so I can buy a dirt cheap house from an investor who is denying me from buying an affordable home. Now its the buyers turn.

  3. This is just the start.

    Imagine how house prices will react when Glenn hits the QE ‘print’ button – only a matter of time – and the property-invested political class allows punters to leverage against their superannuation accounts when buying property.

    Set the controls for the heart of the sun! We’re going vertical!

  4. The off-track housing market could make politicians and speculators happy for a limited time in the ‘lucky’ country. But the painful correction would soon be felt by everybody, including the innocent ones to this Ponzi game.

  5. Salaries going down, dollar going down, tax revenue plummeting, but house prices are still rising. Just wait until we drop interest rates even further to ‘stimulate’ things.

  6. I am hoping this damn thing bust. Its needs to get going to correct. So many people in Australia are going to hurt from this big time. I want to feel sorry from them but then I just cant because you cant just borrow borrow borrow and not know that it could end up in disaster. Hopefully the bust will happen this time unless the govt pulls something out. They do have a vested interest in it not busting.

  7. @5

    Yep, you got it. And our mining industry is headed for a train wreck:
    http://www.marketwatch.com/story/china-steel-now-as-cheap-as-cabbage-weighing-on-global-price-2014-10-13

    I read years ago, China has stockpiled literally tonnes of commodities. Like over two years worth of copper, something like 5 years of cotton, etc. etc. (Not to mention the London exchange, and the thousands of warehouses in Detroit that are full of commodities: Cheapest warehouse space in the USA).

    It’s been an amazing ride, and I personally never got on the mining boom band wagon (far too conservative), but I know a few folk who are, and practically none of them have anything of value. Sure, SUV’s, boats, TV’s etc. But no real assets.

    We are yet to see the worst of the employment story in Australia.

  8. Little wonder overseas investors have been selling down our banks.

    Just got an email from RaboDirect. Rabobank Nederland plans to cut Rabobank Australia Limited loose, ending it’s guarantee on the 30th April 2015. Wonder if the parent sees something coming?

  10. The Australian economy is massively distorted. Tax and housing reform should have introduced well over a decade ago. They (the politicians, banks, builders, etc) will keep the game going as long as they can. At some point the economy will crap itself. More likely through an external shock. What remains of the ‘real’ and productive economy will not support what is a massive mountain debt.

    The economy is being ‘managed’ by Joe ‘Bungle’ Hockey an economic illiterate.

  11. Over three years ago report was produced (Forbes I think) that stated that the Australian banks had exposed loan books. At the time they had the profile of the US banks just prior to the property collapse in the US. We are now three years on. Don’t worry as the banks have a agreement in place whereby the stupid politicians will bail them out. Come the crisis I would nationalise them all.

    It is sobering to think that well over 50% of Australian economic ‘activity’ is now attributable to the finance sector. A sector that produces nothing of value. Australia is a ‘rentier’ economy.

    Personally I think we have been living an illusion as GDP traps all transactions, including those of the finance sector. These transactions have created an illusion of growth. The hollowing out of the economy has been masked by the mining boom and access to cheap credit (debt).

  12. @Matty this is why I’m a happy renter and i own everything I have with no credit cards 🙂

  14. Knowing someone in accounts for a large mining services company (ASX listed) he has gone from being flat out to avoiding payment emails and doing everything else but pay the bills.
    It would not surprise me that a lot of companies are doing the same thing and waiting for the dominos to fall. (This is WA by the way)

  15. The problem is with the govt allowing all these foreigners in to buy property the bubble may never burst. So sad as these Chinese are going to make the property market untouchable for so many families.

  18. No where near enough signatures on that petition. What will chage in china on December 1st 2014?

  19. @LBS
    I hope this thing reaches epic proportions! The echo boomers can use their super, let’s drop interest rates, no macro prudential, build as many dogboxes for asian infestors as possible.
    Let’s do it as fast as we can to get it done in the next year as unemployment (and under employment ) rises.
    When the choice of external shock comes (pick one) I will have the popcorn and no debt!

  20. The New South Wales line looks like it is approaching a vertical asymptote. Of course it won’t.

    The plan (from the big end of town) is to pile as many people in to keep things going. But with the number of people living in poverty accelerating and jobs disappearing you can bet this won’t end well.

    When I walk to work of a morning and around town at lunch time the number of destitute people begging on the streets, the number of buskers and the number of people selling The Big Issue, seems to be growing.

    The chuggers are also getting desperate. They will almost tackle you in an attempt to drain your bank account on a monthly basis. Of course like most things these days it is a scam. 90% of the first years pledge will go to the chugger not the charity.

  22. @LBS “The problem is with the govt allowing all these foreigners in to buy property the bubble may never burst.”

    This is what bothers me the most, too. And yes, JJ, I’ve signed the petition but given that our government has recently introduced the $15 million fast-track visa for foreigners, they have shown that rather than slow down foreign investment here, they want to ramp it up even more. Whether the money is legit or corrupt doesn’t matter to our vested interests, the only thing that matters is that our bubble keeps growing and everything will be done to enable the bubble to grow, even it means Australians are locked out of the housing market.

    @Steve, you say to grow the bubble to epic proportions so that it will then pop, but who who says it has to pop at all? Rising unemployment and debt levels are no longer relevant. With billions of dollars from corrupt sources overseas being parked in Australian real estate, there is no limit to the extent of this bubble. And with both sides of government committed to ensuring the bubble grows even bigger, what hope does the ordinary Australian have?

  23. the ordinary people of Australia will be faced with streets of empty houses and as the unemployment continues to rise further there will be more existing Australian owned homes up for auction only to be taken by Chinese. At some point their will be low economic productive society. This will be the turning point long before we all become homeless squatters many will protest and cause massive riots throughout the cities of Australian.

  24. TC, by then, most of the damage will be done. You can’t take properties away from Chinese investors, so they will continue to own more and more. And our government, whoever is in power at the time, will be faced with the enormous job of providing public housing for Australians who can’t afford to buy or rent. But the government will be powerless. The type of housing available then will be all the tiny dogboxes being built now – the slums of the future. Families will have to squash into these ridiculously small cupboards as they will be the only forms of housing they can afford without, and which will be close to infrastructure.

    Of course, there will also be a large bunch of Australians who inherit property portfolios, bought when property was a fraction of what it is now.

    There will be riots and protests but it will be too little, too late. The time to do something is now. But instead, we’re letting foreigners buy up the country and letting in hordes of immigrants just to keep the Ponzi going and to keep prices going up.

  27. I hope that we have more influx of immigrants from everywhere, because Australia is an empty country (except, of course, Sydney and Melbourne, and may be Brisbane, now). Then there will not be a housing bubble and economy will be better. Imagine all people going in the rural villages and towns! That will be great idea. The government needs to think about local manufacturing and economy boost.

  30. Its called the white ant effect, Australia is being eating out from the inside. just look at New Zealands biggest city Auckland where this has been going on for a decade at least

  31. Various governments of Aust sold out to the international central banking cartel long ago, with a variety of short sighted “deals” such as the GST , compulsary superannuation . FIrst home buyers, High immigration,” free” trade! And most recently the AL gore wealth tax.
    All these cute deals were cooked up by ivory tower social scientists in the so called “economics profession” who use models to come up with “solutions” . The models themselves are based on Keynesianism and fiat currency, which we are told means that more circulating money = more GDP= A better economy.
    If this were truly the case simply printing money would be the solution to all the worlds poverty problems and no one would ever have to work.
    Keynesianism is simply a crude intellectual cover that the parasitical Central Bankers need to convert every productive asset and home into a ” bank asset” . Unless central banking itself is made illegal and sound money is restored then eventually the banks will simply own everything! and you will work for them, ( if you dont already).
    Enjoy the road to serfdom.

  33. @Poppy, if you haven’t already noticed, nearly all our immigrants move to the big cities. Melbourne and Sydney are set to double in population in the next few years. Australia is largely an empty country but we are also one of, if not the most urbanised country in the world. And the many vested interests like it that way because we feed the giant Ponzi scheme that is our real estate bubble.

    Which leads me to the next point – you say, “then there will not be a housing bubble”. Too late for that. Our housing bubble is one of the biggest in the world. Sure, there is plenty of room for our country towns to grow but the jobs are in the cities. We have killed off manufacturing and it’s not likely to start up again when we are so uncompetitive on a global scale. You can’t go back 50 years into the past – you have to look at the situation as it stands now.

  34. Poppy, yes wouldn’t it be great if the whole world turned into over-populated concrete urban sprawl with grey smoggy sky and no wilderness. That’d be great for the economy, hey.

  35. @31 Swaggie

    You’ve got it. But, more than illegal, central banks are in fact unconstitutional in most countries! True fact.

    It’s got me beat, how Qantas (who is operating in a kinda free market, but struggling) gets fined for market collusion: But the Big Four CEO’s meet with our federal treasurer and the RBA governor, right under everyone’s nose and no one complains: It’s incredible.

    This is truly a disaster of epic proportions in the making.

    What’s that line about the white trash of asia?…..

  36. @Matty, who’s going to complain? Both sides of government have colluded to create and grow this housing bubble. It’s not an official collusion, but it’s fairly obvious that both sides regard our housing bubble as sacred, that is, nothing must be ever done that might cause prices to fall.

  37. I came across few comments with some “Chinese” derogatory terms.

    I am not supporting arguments based on racism remark but I just want to point out few things:
    1) Why don’t just use “Asian” instead of “Chinese”? Because how do you actually differentiate between Chinese, Korean, Japanese etc except that one is familiar with the language or socio-cultural background of the person of interest?

    2) I do know many so called “Chinese” that are not rich in Australia. Many are just living like many other ordinary Australian trying to meet end meet.

    3) “Chinese” is a very broad term. There are “Chinese” from Mainland China, or even Taiwan (try to tell people from Taiwan that they are not “Chinese” or they belong to China, you will see some interesting response). There are Australian-born Chinese. There are Chinese from South East Asia. There are American Chinese. There are also HK Chinese. Likewise, there are many Japanese and Korean overseas that “look” like “Chinese”. Are they not rich? Some of them are. Many of them are not.

    So let us not get to senseless argument about material wealth and race. Some Jews are rich. In fact, I read somewhere American has the highest proportion of richest people in the world. They can invest in property in Australia easily too. Are they too … “Chinese”?

    You get the point ….

    If you suppose to be the “enlightened” one and:
    1) still bickering about who is rich “Chinese” and who is not.
    2) still blaming all of your misfortune to someone else, not taking responsibility for your own life (even after you have been given information contrary to your initial belief)
    3) still fighting over nothing instead of finding a solution to each one of your own problems (even after been given many other alternatives).

    Then shame on you …. No wonder you linger on this site …. complaining and complaining …. Not even grateful that some brave writers have provided such information to the public.

    Society in other countries has moved on fast. Personally, I have to paddle with twice of speed for not being left behind …. If you don’t, you have yourself to blame.

    An interesting article to ponder …. Maybe he is a “Chinese”?

    http://www.news.com.au/lifestyle/parenting/are-aussie-kids-becoming-poor-white-trash/story-fnet08ui-1226606663083

    Hope this help. Good luck!

  40. Yusef, thanks for turning this into a racial issue when it is not. It is actually a FIRB issue.

    Kind of ironic how you are complaining about people ‘complaining and complaining’ … dude it’s a blog, people complain – get over it.

  41. @37 Thanks Yusuf, I agree with you. It’s one of the reasons I’ve pulled back from commenting on this site and indeed why I’m becoming more and more bewildered at the underlying prejudice of quite a few commentators on sites like this and also in the media. Remember we are ALL immigrants to this beautiful country.

    Mark Latham is right, and I will add that it is the ‘white trash’ sense of entitlement and the sheer laziness and apathy of many Australians that is destroying this country, NOT hard-working immigrants.

    I despise the current financial situation as much as the next man, but to continually blame immigrants for all our woes is disgusting. We’re better than that – aren’t we?

  42. Yusuf, I don’t think it’s derogatory to state that the vast majority of funds coming in via foreign investment in real estate is from Chinese in mainland China. That’s not to say that there isn’t also foreign investment from other countries, both Asian and from other areas. But most of the money is from China.

    And the reason this is such an issue is that China has an enormous population, and now a growing wealthy and middle class. In addition, being a communist country, there is a lot of corruption going on, and understandably, those who have made a lot of money, either legally or not, want to get their funds out of the reaches of their government. So naturally, they are parking it in Australian real estate and real estate in other countries. It’s far more noticeable in Australia because firstly, we have a relatively small population, and secondly because a large proportion of our population lives in urban areas. The Chinese, in particular have deep pockets and can easily outbid Australians for real estate, and it has to be said that some or a lot of the money they use to outbid Australians is from questionable sources. They are going for certain suburbs, and pushing up prices by two and three times what they would be ordinarily. They know it is safe to launder money here because we have a completely useless FIRB and there is nobody to monitor or police any of the laws.

    Of course there are other rich groups of people from all over the world, including Australia. That’s the way of the world. But we’re talking about the unfair advantage given to those who are using corrupt money and squeezing Australians out of home-ownership and like it or not, in most cases it’s those residing in mainland China. It’s not the only factor contributing to our housing bubble – there are many others. But it’s a big and obvious factor, and one where there are rules that are being broken every day, and FIRB just turns a blind eye. In fact, the FIRB doesn’t even know about a lot of it, and they don’t want to know, and don’t give a damn. They get paid handsomely regardless.

    We’re not talking about Chinese Australians or others who look Chinese, however, there unfortunately for these people, they are going to be lumped in with the foreign nationals because of their looks. It’s not their fault, but it’s one of the consequences of our government’s Selling Off Australia policy. Our government (both Labor and Liberal) are completely to blame for unaffordable housing, but the scapegoats will be the Chinese.

  43. @Yusuf, most of the reactions on this site are based on an actual phenomenon, not on racism. The real estate industry and government are enabling/encouraging foreign investment (a large proportion of which is investment by rich Chinese) to supplement the falling demand for real estate, in order to continue to keep the massively inflated house prices out of the reach of ordinary working Australians (whose median salary is a measly $50,000, less than a tenth of the median house price). I find most of the people who comment here are not complainers, but people who see things as they really are, and who are not brainwashed into believing that the ridiculously distorted, mainstream view perpetuated by the media, the real estate industry, and government is normal, acceptable, or ethical.

  45. Ignorance…. is why we are in this mess if everyone in this country stepped up and voiced their opinions of the corrupted chinese money years ago tbis would have been corrected by now. The problem is people like this Yusuf character who is supporting the corruption by using the racist card. Then many Australians get shy and there are only whispers to be herd of the house next door which sold to rich chinese for three times the reserved price never to be lived in with high grass and a over grown garden.

  46. Yes, we do in fact live in times of historically-unprecedented ignorance (mostly ignorance of the law).

    I just want to (kindly and sincerely) caution people NOT to resort to overly-simplistic issues such as whether or not our (would-be and once were) servants our operating under the name Commonwealth of Australia or the corporation Australia (established in 1973 which is why we needed a new anthem for the “corporation” etc).

    The true issues stem so far back that issues such as that mentioned above are merely a symptom rather than the cause of our coming very soon (very) difficult times.

    Put plainly and simply it all boils down to whether or not we as a people in this or any other country have decided to take up our responsibilities in order to preserve our rights (which is a per-requisite for either maintaining or gaining more freedoms and rights).

    Of all of those responsibilities, the greatest and most damaging is the manner in which we decided/decide to take care of the (truly deserving) needy and poor of our society.

    To take up your responsibility (in order to preserve your own and everyone else’s rights and freedoms) this task is carried out through free will offerings/voluntary givings to someone or indeed many hundreds who are provingly and well-trusted individuals to administer the help to the (genuinely) deserving and poor. This is how it was done until around 1936 and is also why we actually had more freedoms back then than we do now.

    People took up their responsibilities to take care of their neighbours etc through free will offerings via trusted people (true ministers who are servants and not rulers as we have today).

    The VERY MOMENT we gave up those responsibilities and handed over the task of taking care of the needy (deserving or NOT) we lost our right to have full title to property, heck, even our right to be the true legal parent of our children (I can legally prove and demonstrate this one).

    Anyway I guess what I am saying is be careful who you blame (for our current predicaments) and what you ask for, because we ourselves are largely responsible through becoming irreponsible throughout the past 100 years or so.

    To turn things back around again and regain freedoms and full legal rights to property that would require a re-uptake of those responsibilities mentioned herein.

    I feel that there would hardly be a one in ten who have the backbone to undertake such as task that was merely taken for granted just some 100 years ago.

    Yes this will NOT end well anyway, but the real final problem will be that most people will not now how to survive the (forced) freedom that would arise out of the (virtually guaranteed) collapse of the financial system as we know it today.

    I am just putting this out there very early in the piece in the hope that one or two out of a million might think about it and research it and also find out what it was that kept our ancestors actually free and will rights to property fully intact.

    It all comes down to what type or kind of welfare system a country or community is operating under.

    It is a system of free will offerings or forced offerings through taxation etc?

    I will give you two guesses for working out which type of system eventually and completely collapsed EVERY TIME is was used in the past.

    We are not operating anything new here but something that was tried, practiced and failed every time it was used in the past.

    The problem has become education itself too, which conveniently leaves out these critical historical details which everyone should know.

    Anyway just putting it out there to stop people attacking the wrong issues. It really has nothing to do with whether or not a country is a corporation etc (these are just symptoms of already having done the wrong thing long ago), but what fundamental government system one is running particularly when it comes to how the (genuinely deserving) needy are taken care off.

    Everything else is a symptom e.g. Housing Bubbles, Wars, Good being bad and bad becoming Good etc etc

  47. @ Yusuf

    Sorry, but I disagree with you mostly there. The reason the Chinese are mention specifically is due to their behaviour. The Japanese, Thailanese etc are not here out-bidding/over-paying for ‘assets’. So by asking us to group the entire region as one, you are in-fact, the one being stereotypical…. Something to ponder maybe? (it makes me furious that those who exclaim ‘racism’ have the weakest arguments that collapse under their own weight).

    I’m simply flabbergasted at the need to be cared for by the government by Australians. We learned nearly 12 months ago that Holden is to officially shut it’s doors, but I’m yet to meet anyone who is actively preparing for the loss of their job at Holden or it’s supporting industries. Only last night a guy on talk-back radio is sooking that Holden wont pay for him get trained so he can ‘do what I want to do, which is gardening’. What a self entitled view, ask all the low paid retail workers, warehouse workers if ‘they’re doing what they want to do’. Most hate their job, but it puts food on their table.

    The Holden debacle will be Mitsubishi all over again, millions of dollars spent on ‘retraining’ so the workers get jobs. What actually happens is ‘jobs for the boys’ who provide the training and a sobering statistic of 85% of these workers will never again be employed. These workers are highly unionized, their ethic is shot and their sense of entitlement high, what small business in it’s right mind will employ that, when the phone and email inbox is already full of eager/driven people looking for work off their own back?

    Back on topic: The US FED is now far and away the largest property holder in the USA. Their little plans working out ok for them isn’t it.

  48. I cannot comprehend the logic in allowing anyone who is not either a citizen or has residence status in Austalia free and unfettered access to Australia real estate.
    We don’t even have the benefit of knowing via the ABS the real reality of the true stats referrable to this “investment phenomena”!
    The ABS was stripped of 100M in funding by Labour and recently by 280M by the current dolts in Canberra!!
    All sobering stuff and the implications are really disturbing even to “blind freedy”!!!
    Which leads one to the elephant in the living room – how come I cannot purchase real estate in the majority of those Asian countries whose citizens are so blessed to have free and unfettered access to our real estate?
    Something very strange and disturbing is afoot!

  50. Claudem777, you present core libertarian ideas in a polarised mental model: Private vs government (with the preconceived solution of private being better than government and the whole story being somehow dependent on ‘property rights’. This is unfortunate because your mental model excludes the interesting problem, namely: What are suitable boundaries between private and government economic activities now and in the near future.

    I suggest to you, most of the comments on this thread deal exactly with an example of the interesting problem.

  51. @ Matty,

    You don’t have to agree with me. I am not rallying a support for me, for you or for anyone either. You can hate me too.

    Someone mention that I am “corrupt” for stating that it is not that simple for “bubble” to be caused by one group of people – whoever that is. Very interesting.

    If you are sensitive with the words “Chinese” than that is too bad. It can be “anyone”. Use some common sense. I have facts, anyone can disagree with the fact (you can say the source is unreliable).

    If you attack my character for stating an opinion of the fact from quite a reputable source (in my view) than doesn’t that say something about the person? Where is your fact?

    Someone can even disagree with the use of the word “bubble” and have been fighting all over it in the media all of these few years …. You know better than me I suppose …. I don’t care.

  52. I am 73 years old and so have already bought my house ,but I cannot fathom why this government seems so hell bent on selling of our country to foreign interests, along with our car industry our shipping industry our renewable energy industry etc etc etc ,while the young people of this country cannot afford to buy their own home ,its like a fire sale ,lets get rid of everything to foreign interests ,screw the poor ,the young the old the sick ,did I forget anyone .who the hell are these people ,don’t seem to be Australian .

  53. The ease with which money can be created out thin air by the RBA, gives any Australian government carte-Blanche to promise whatever handouts are necessary to any and all organised groups of voters. Taxes are really not even necessary for .GOV at this point. Except as a tool to force Australians to keep using the AUD, while .GOV and the RBA stealthily inflate away it’s value.
    .GOV and the RBA know that they must do whatever it takes to keep the all consuming property bubble growing larger and larger. Financialisation and Globalization has gutted our economy of much of its productive industry, leaving a large part of the population heavily indebted to the banks for overpriced homes and working in service industries dependent on consumption fuelled by HELOCs, credit cards, personal loans, and generally greater personal indebtedness! When the property bubble eventually bursts, all illusion of wealth created by the borrowed money goes with it, and only the very very personal debt will then remain.

    So much for housing and immigration “creating wealth” , maybe for the banks it has at least..

    The aloof and unelected money changers in the worlds central banks. Have mastered the art of controlling western society. Partly by controlling our money, and partly by allowing the ludicrous spectacle of representative democracy to befuddle, amuse, distract, disgust, and entertain us.

    while all OUR wealth, quietly becomes THEIR wealth…

    Very very sad indeed.

  56. @Yusuf

    Mate I think it was you that was sensitive with the word Chinese. And I think your a little self-absorbed and surly because your stupid point has been trashed by a scope of opinion.

    Next time, stay on topic and remember it’s not all about you. Keep the “I’s” and “me’s” to a minimum. And present facts, don’t just claim to have them like a schoolboy.

  57. @Swaggie

    While kind of correct that the government doesn’t need a tax base to print money as it isn’t backed by gold/silver/oil etc. But it’s our labour and innovation that through the taxation system gives it ‘some’ value. The first dollar was ‘created’ by the RBA, the government borrowed it promising to pay it back with interest…..that’s in the form of another ‘created’ dollar, where does the income for the government come from? Our labour and innovation.

    So, if the government suddenly dropped the taxation system, you would see our currency collapse (for a variety of reasons) because the debt is very real, but the ‘created’ currency is literally nothing.

  58. It’s just an unfortunate, confusing common use of the word “Chinese” to refer to people from PRC and people of the ethnic group originated from ancient china. We all knew the buyers outbid everyone here were from PRC. And also it’s totally OK to address a group generally. There’s no need to explicitly states there is exceptions. Says U.S. people are fat, or Europeans are tall, doesn’t mean all of them are all fat or tall.

    No real meaningful need to argue about what “Chinese” means. Let’s stop the argue and get back to the discussion.

  60. @ Matty

    Interestingly when the € was first introduced, the first order of the day was to get as many governments as possible suckered into € loans. Thus creating a base demand for the currency as people scrambled for € to pay off their obligations.

    If everyone in Australia stopped paying down loans and stopped paying tax, then the AUD would quickly collapse. You are correct saying that it is people that help give these pieces of paper value as money, through our labour, brains and toil. We live in a world of fiat currency, where digits on a computer hard-drive can represent years worth of hard work or an entire country’s total debt obligations.

    Unlike sound money our present money is completely useless outside our present system, where we are forced to use it by virtue of legal tender laws.

  62. Lots of media coverage happing on a very close related subject. The Banks the Big 4 have been conning customers for years signing customers up for loans they cannot afford. Giving people on pensions loans on interest only over 30 years when the interest payments are more than the pension per month. When they cannot pay then the bank takes their homes. This is very wide spread across all states. How do they get away with it you say. Because like the situation you talk about with over sea people buying up our homes and top country farms . No one will listen. Denise Brailey is an advocate for the consumer on bank corruption and financial corruption she is leading the fight and getting the media to listen. You can google her she has a change petition going at the moment you might be interested in. Keep up the fight some one will have to listen before it is too late.

  63. @62 Maggie

    It is too late. No-one will be penalized. Not one individual in the USA was even tried regarding the GFC. Even with clear evidence of the theft and fraud on an epic scale.

    From my POV, I say ‘sorry, you’re screwed’ to those who were conned. Unfortunately, people are failing to take responsibility for their actions on a scale only the Roman’s could understand.

    What I want protection for is for our savings, assets and super funds that are wisely created/build/made. But, this is wishful thinking. As Cyprus has shown, your savings and belongs are actually property of the State.

  64. http://www.illawarramercury.com.au/story/2649475/who-will-qualify-for-83000-home-deposit-scheme/?cs=300#disqus_thread

    Good to see that the Building Better Regional Cities Program is being used to improve the livability of regional areas – here is Wollongong City Council getting into the housing grants caper.

    It is a “partnership” with a local bank (the IMB). Council provides a grant of up to $83,000 to a struggling home buyer who can’t muster a deposit, and the bank does the rest. The idea is that when the equity in the property has increased sufficiently, the amount of Council’s grant will be released back to Council so that it can be “recycled” for more grants.

    Not sure what the plan is if the market falls, but I’d imagine the bank will be protected somehow!

    There are obviously a raft of issues here. Even supporters of the scheme must be concerned that it appears to be exclusive to one financial institution, the IMB.

  65. TV coverage is happening might be worth watching Tracey Grimshaw on 9. They are talking about Home auctions and international investors this will be shown in Adelaide on Monday night. Might be different in your state. This could be the media support you people could be looking for. Some one that has been affected need to conduct 9.

    The media is starting to chase us for stories in SA from people who have been conned by the big 4 banks in SA.

  66. Don’t know if I trust Channel 9. Thursday night in Adelaide they were running a story that listings are up 14%, and trying to portray that as meaning the market is booming. Off course it came out the same day, the Domain group reported Adelaide house prices fell 1% for the month.

  67. @Yusuf, hear hear mate!
    Generalization and total ignorance the “order of the day” in this society!
    Unless you wrote your comment in “mandarin” I understood exactly what you alluded to! And it was merely correcting “generalizations”.

    Lets put things into perspective, if the Chinese government was allowing Australian citizens to go into China and buy up all their real estate, for pennies on the dollar, would Aussies be sitting there saying “no we better not because this will mean the average Chinese couldn’t afford a house?”

    Heck no! You wouldn’t give a rats backside!! You would buy, buy, buy!! Survival of the fittest.. Isn’t it?

    1. Today’s society, no matter what race – is all about Number one! No one cares about anyone!
    2. If you want to complain, then direct your complaints at the Government, that you elected.
    The foreign investors only get away with what they are allowed to get away with. Governments are all about lining their pockets at your expense. It’s by design… They rob you blind and then they sit back while society begin attacking and blaming each other.

    Lets do the universe a favor and practice some “CRITICAL” thinking people!
    Some of you lot need to stop drinking tap water because your comments reflect those with calcified pineal glands!

    The reality is.. If you’ve ever had a credit card, borrowed money from the bank, have a mortgage or owe money to any financial institute.. then you are just as much to blame than any foreign investor for the financial mess that this nation and every nation on this planet is in!

    Instead of finger pointing, why don’t you start asking our kids for forgiveness for screwing up their financial futures then begin to start educating them so they don’t repeat your mistakes!

  69. Henry Makow. “We are living in a fools paradise.Unfortunately people won’t wake up until they take away the goodies,and then it will be to late”.

  71. @ average_bloke
    Lol.. Yeah who owns that publication? It’s hardly an independent source!

    No one is saying that it doesn’t happen.. The question is.. Who allows it to happen??

  72. I might be no one of significance but the fellow below might know a thing or two, and this is what he reckons…

    “We can’t solve problems by using the same kind of thinking we used when we created them”
    Albert Einstein

  73. Realist, you ask who allows this level of Chinese corruption to happen? Our Australian government has made it very clear that “we are open for business” and the FIRB, by their method of doing nothing and rubber stamping every application, that is, if foreign investors even bother to apply, have shown that corrupt money is very welcome here.

    As the final paragraph says,”All this suggests that Chinese authorities could be frustrated by ­Australian courts for many years in their attempts to repatriate funds… But that is why many corrupt Chinese officials chose to hide their money in Australia in the first place.”

    Usually in Australia, white collar crime attracts some sort of punishment, even if the laws here are rather lax, yet this has been going on for years and our government (both sides) have chosen to do nothing. In fact, watch as our government continues to protect those who have laundered corrupt money through Australian real estate.

  74. Yes I would for the best part agree with both Yusuf and Realist on this one. There is a very real danger any time we decide to make gross generalizations – especially when we pin it on one particular race or ethnic group.

    I wonder, if the folk who visit this site had have bought and sold and bought and sold time and time again over the last 20 odd years – now sitting sweet with a big wad of money, still hold the same view on the housing issue?

    However, I would also agree with Matty. We in the lucky country are going to get hit hard, sooner than later. And housing may well be the least of our troubles.

    As for folk from O.S. buying up our properties, I would agree this may cause a lot of hurt. A bit like all the Aussies buying up properties in N.Y, France and Greece a while back. But when a correction occurs, it’s just a matter of waiting patiently:-)

    Shit, after all, when ya finally get the big fancy house, you realize there aren’t a great lot of real intrinsic pleasure to be gained from the whole thing.

  75. Chinese corrupted money is flowing into australia do not make this a race or generalized opinion this information is well known. I do not use the word fact because I do not have the statistics. However it is happening.. while many of us still cannot afford our first homes.

  77. That’s life folks. Life is hard – and then you die. Don’t blame immigrants and foreign investors, they are not breaking any laws, they are doing exactly what we would do if the situation was the reverse. Blame the law-makers.

    We only have ourselves to blame for not holding our elected representatives to account. We get the the government we deserve I’m afraid to say. If we took more of an interest in our country instead of being arrogant, complacent, over-entitled couch potatoes, things might be very different.

  78. @md
    My question re: who allows it to happen?
    Was actually a “rhetorical question” intended to make a point.

    I am well aware of who allows it to happen, the point I endeavor to make is that while it may be true that “foreign investors” do as they do, they are pretty much given free reign to do so. However, instead of finger pointing, why don’t you question the bureaucratic mess they call “democracy” in this land?

    Contrary to what citizens may wish to believe..the elect’s best interests are not of those who reside in this land. Their interests are of those to whom they can profit from the most!

  79. @ Rupert

    Really? I don’t even know where to start with that little outburst.

    They are clearly breaking laws.

    Our politicians have built the system they desired, they are completely immune from what the public ask of them. In fact, the last two Prime Minister have clearly, and open, promised one thing and delivered another: Previously, politicians would dance around the detail, but now they have started a precedent which says the electorate will accept such folly.

    I don’t know what you do for a living (I’m guessing you’re in the FIRE or closely related sector now) and I can assure you that most Aussie are far from couch dwelling creatures.

    First you say they aren’t breaking laws, then we should blame the law makers: Are you sure you have a handle on the situation here?

    The issue is a corrupted sector (FIRE) has been hit hard by falling credit creation and have pulled every stunt you can think of to keep it going. Even building Australian owned and operated RE agents in China. Underneath this mess you’ll find a fractional reserve FIAT currency upon which Aussies are forced to save every week (I’m talking about superannuation) into, which means that never before have the bankers, fund managers and money men had so much money, so much power and so much influence that the thought of weak GDP can’t even be entertained.

    When this all hits reverse, the white shirt brigade aren’t going to know what’s hit them. The big wigs have built their firewalls and know they can ride it out, but the guys who earn their $150k, bragging about how great life is, how easy money is etc, will find themselves fighting for jobs paying $40k. There are fun times ahead indeed.

    Rupert, if life’s tough already as you say, there’s a whole world of unexpected pain to come.

  80. I agree with everything you say Matty. I guess my point is that we should be WAY more proactive in holding our politicians to account – but we’re not. The majority of ‘Australians’ I speak to (and believe me mate, I’m on your side) are totally and utterly oblivious and/or apathetic to what’s going on. It’s like the electorate of this country is sleepwalking into a world of shit, mainly because that have zero interest in anything beyond their own navels or what celebrities are wearing on reality TV shows.

    If this was France or Germany or Italy, or even the UK, there would be massive demonstrations and marches. Even the Chinese and the Hong Kongese take to the streets when they are happy. We in Australia, however, do NOTHING!!! That is my point. We get what we deserve – and I’m sticking by that opinion.

  82. @ Rupert

    Ah, I see. Yes, agreed. Spain/Greece raised the retirement age to 55 and they burnt government buildings and banks to the ground.

    Rudd raised retirement to 67 for my generation, and it barely even made the TV. Abbott bumped it again and we got a few moans.

    For democracy to work, the representatives need to be fearful of the electorate, but some how we got this back to front in Australia ATM and the electorate is fearful of the parliament.

    But this is all part of the seven stages of empire (courtesy of Mike Maloney). Massive government spending on health, education, sports, entertainment and the arts: Keep people borrowing and enjoying the now: Tomorrow is someone else’s problem as far as they are concerned.

    I’m not sure what others opinions are, but I can’t see Australian governments pulling out of the death spiral their budgets are in: LGA, state and federal are all in freefall, and I just can’t see it ever being balanced, let alone repaid!

    You all best, be feathering your own nests.

  83. With the unbacked fiat currency out of control, our ocean liner of property over consumption along with continuous bluster of fresh wind from every government since negative gearing was introduced in 1985. It is no wonder that the majority of citizens on this ship do not see the brake down of service for critical equipment down to the anchors as mandatory, with the never-ending unserviced punch bowl of fiat flows. The party will go on. While the approaching rugged shore line is destined to cause catastrophe a few got off at the last port, only a small number have put on life jackets and have started readying the ones that will listen on this citizenship to start doing the drills…

    prepper

  84. It is interesting but completely expected that rents are flatlining. Wages have flatlined and actually if you scratch beneath the surface, have not really risen a lot for the vast majority of workers. The economy has been running on averages that have been completely skewed by the mining boom for the past decade.

    Our fearless leaders chose not to account for the skew enough because the economy was going gangbusters, on average, and that’s good. Australia had, on average, entered a golden age. Unfortunately it was primarily driven by easy credit.

    But now that the boom is over, reality sets back in and it is suddenly realised that wages haven’t really risen that much to offset the huge bubble of debt that was run up over the same period. To add insult to injury, our income producing resources, manufacturing, is all packing up and heading off overseas.

    The truth will out very soon. But so long as those falling into mortgage stress can offload their massive debt burdens onto someone else when required, and still make a profit, all is well. Cue flooding the market with cashed-up foreign investors.

Comments are closed.