How The Housing Crash Will Happen
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- Опубліковано 19 чер 2024
- Can the Australian Property Market keep going up forever?
🔮 In this episode we discuss the SEVEN WAYS the housing market could CRASH:
👉 War
👉 18.6 Year Cycle
👉 No Population Growth
👉 Global Recession
👉 Climate Change
👉 Asteroid
👉 Affordability Ceiling
It's good to hear both sides of each argument - tune in!
#housingcrash #recession #housingaffordability
Chapters:
00:00:00 - Reasons House Prices Could Crash
00:02:07 - Potential War Impacts on House Prices
00:04:14 - The 18.6 Year Cycle and House Prices
00:06:25 - Factors that Could Cause a 20% Crash in House Prices
00:08:33 - Global Recessions and the Housing Market
00:10:33 - Environmental Impact of Climate Change
00:12:40 - The Problem of Housing Affordability
00:14:54 - The concept of affordability and its impact on house prices
00:17:02 - Predictions for a 20% Crash in Property Prices
00:18:59 - Hanging out in the G Coast
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I've been a huge believer of the property market must crash soon but I've also felt the AUD will crash and unemployment would be huge if that happens.
But what I truly now believe is war is more likely with China because alot of global companies have left China and Russia causing alot of unemployment overseas so if all fails it's easily to send desperate hungry people to war.
But excusing war I think banks in Australia will encourage and force their customers on morgages on 30 year morages to be on 35-40 year Morgages which will allow people to just borrow more adding more fuel to the fire.
But if none of those things happen and employers don't pay more and interest rates don't drop then yes the housing market will stall and people with lots of debt will habe to continue to hike rental rates like everything else to the point that people have to sell everything they don't own like holiday homes,airbnb's, rentals and cars. But if it comes to this the cbd won't drop its the regional areas that will drop because everyone needs to live closer to their jobs
@@bign1667 thanks for sharing
To me it's very straightforward -- supply and demand imbalance. We have severe shortage in supply and ever increasing demand. Price just can't fall much! When it falls a bit, people will go in and snatch the houses!
The real reason why real estate in Australia will not crash is because many politicians have huge investments in properties 😂 ... If they made a limitation for the investment properties that a politician would be allowed to hold, then I would be concerned...
huge conflict of interest hey. I remember writing a report when I was doing my Undergrad and it was like 1/3 of politicians owning more than 1 property.
wow siick reply! wanna know how many cones i smoked today? or are you a politician?
@@Packacone420 I beg your pardon?
18.6 year cycle may beyond their control.
Politicians could not stop the crash of 2008 😂
Love your show PK. But the fact that you stated you have over 50,000 property investors in your group is exactly the reason why I have exited Realestate as an investment vehicle. I think it was buffet that stated “ when the shoeshine boy starts giving you investment advice” that realisation hit me a couple of years ago. For us property is done. And as an investment strategy, it has been done for quite awhile.
Property in Hong Kong has fallen more than 20%😢
Yes. Property can fall a lot. Especially when it's geared a lot.
PK, you teach me new words too hahaha!
"postulation".
Great video PK, no one mentioned AI, if AI takes off faster than we think many Aussies will loose there job/income possibly over 50% of working class will find they cant pay their Morgage any more after there savings are eaten away with the rising cost of living like it is now, with school leavers each year on top of immigration numbers wanting an income to pay for property something has to break.
Thanks for sharing!
AI increases corporate profits right? Which means the rich get richer? Which means they have more to spend on housing? Taking it even further away from the middle class?
@@AusPropertyMasteryWithPK So who is going to be living in all those houses they buy when no one can afford the rent?
@@dedebettaaquatics8710people who can afford the rent, just like in NYC or West Coast US. Same principle. As inequality rises the question is if the top 20% can afford them then the demand remains.
People there quite commonly pay 5-10k a month in rent.
Keep in mind only 30% of properties are rentals.
But like I said in the video - this is simply postulation - please share your views too
@@AusPropertyMasteryWithPK trailer Park trash
That was the term used in the USA 30 years ago
It's here now and growing
Thanks PK . There is a huge property crash in Canada .
where?
One overarching thing that could cause a crash and was not included is a change in government policy towards CGT and other associated taxes.
I doubt that will happen but hypothetically they decided to really get serious on housing affordability they could initiate policies that would enact a crash.
In reality too many of the pollies own investment properties for them to ever do that but it has the potential to cause a crash.
Thanks for sharing.. they removed negative gearing once before and it didn’t crash the market.. CGT is probably less impactful.. but depends on exactly the change..
Can’t see how climate change could cause a housing crash even if we see massive sea level rise. The climate changes so slowly, literally over decades or centuries. This means there can’t be a shock to the market as the market and society will adapt to the change. And even if some places do get flooded it just reduces supply and will push prices up in higher areas that can’t flood.
The affordability ceiling is the most likely reason for growth to stall.
My personal feeling is that housing is being priced for perfection these days. Close to it anyway.
Last point - class revolution: throughout history if the wealth gap between the haves and have nots becomes too large almost always what follows is a civil unrest (we are already seeing a bit of unrest today and this has been observed throughout history in almost all civilizations) if nothing is done and the trend continues, capitalist systems and ideology will be under threat, and the most vulnerable asset class in Australia to be targeted first is real estate
Thanks for sharing.. how do you see this playing out in Australia?
to generalise asteroid - any catastrophe leading to a sharp sudden population decline - that must lead to the demand decline. So live now while you can - don’t invest (half-joking). Amazing Video PK !
Is your prediction inflation adjusted?
the government not letting young immigrants' family get visas for their parents, effect funding for study as many parents pay for study and housing planning to live here, childcare as in the past the grandparents would do it but for immigrant but knowing places are hard to get many deter settlement.
Sir, I have reached a servicability cap according to banks but i know for sure i can service another property. How can I get a good investment property with good yield?
Net births are 300k per year in oz.....
It’s about 100k
housing crash very nice pk harry dent. great video
Cheers mate… hopefully harry comments! 😂
@@AusPropertyMasteryWithPK haha true bro your video content is top notch you never disappoint.
@@AusPropertyMasteryWithPK imo a few reason’s could occur Pk as home price’s down here in Byron has dropped 20% but a few things are coming into line
Logic
- Nickel and lithium price’s have falling off a cliff and mine’s are shutting. Other mineral’s may very well follow suit.
- Yes War may.
- unaffordable housing
- IMF last fortnight as you know advised Rba to raise rates an advised Government to adjust tax’s ? Government did the Tax amendments as your aware so rates maybe next ?.
- Unemployment is coming up as i am seeing a fair bit of retailers closing up across my travels.
- Government is slowing immigration before they get to much pressure, they would not of changed the Tax stage 3 if something is happening to inflation.
Guess a lot can occur what do you think about the mining slow down across major sectors.
There's only 1 thing that will cause a crash and that's a sudden die off in population
Price is value perception. Something is only worth as much as people are willing to pay for
And it's dictated by supply and demand. Once all the old people die off (we've got an aging population) And there becomes a huge supply of homes, then the price will also fall. But, it will happen in around 100 years, we don't have to worry about that in our generation. Ha
Climate change is as controversial as the Round earth topic is
You forgot about rising unemployment prediction for 2024
I covered off in a whole video. Immaterial
I'd be more worried if the rental market crashed, I'm not planning on selling but do plan to retire on the rental income one day.
1.2m rental homes built by National Cabinet Agreement with States will lower rents. It's more holding costs going up which affects yields:-
Strata Fees
Insurances
Emergency Services Levy
Climate change events a nd insurers not allowing rebuilds means land value only.
No one wants to sell lol😂everyone wants to build and expand and buy more.
Tax reform.
People wake up to the current tax system that transfers younger generations post tax income to asset owners who pay no or discounted capital gains tax via leverage
We are headed for a massive correction in everything and our standard of living will dramatically fall. It's already happening...
It's already underway in Victoria PK. I'm calling a massive East Coast crash, meanwhile the West will ride to new highs. Simple economics at play, plenty of people are going to be in serious financial stress.
Government scrap or significantly change negative gearing, CGT benefits 😉
Hey that doesn’t crash the market, it’s been revoked before
Yes, it has been revoked before but it was long back under very different financial circumstances. Negative Gearing can cause significant rent rise which creates a domino effect on affordability and house price. I am just suggesting this as a probable option of housing crash (>20% drop). OfCourse, I am nowhere as close to understanding Aus Property Market as you.
@@garvitdhoot5693 please see here:
ua-cam.com/video/5fJ2VTh5D7U/v-deo.htmlsi=bdox0dzERL1h5se7
It will crash 2026 and 2027, 2028 - 2030 start buying like crazy. 18.6 year property cycle
There's no room for poor people.
I follow you PK for information, but not to make any of my financial decision based on your data. By saying this I feel it very funny like people like you making videos about housing crash of 20%. Why? Crash means losing majority of your invested money, yeah. Since in housing there is 80-95% is leveraged money, and only losing 5-10% asset value you have lost your whole invested money. This crash of your invested money and properties can go 5-7% down, which means losing 60-70% of your invested money. What are your thoughts on?
Sorry I didn’t understand. Did you watch the video?
Yeah PK and I have listened most of your podcast too (not those for promotion of your so called property accelerator course), not just this video. And yeah property is not gonna crash 20%, but to lose money in highly leveraged asset only 5% drop is enough. Thats what I am trying to say - in few words.
@@pritpalsidhu185 why do you say “so called” Course?
Market went down over 5% in 2022. Then recovered by more than that in 2023. Didn’t seem to bother most people.
Hey mate. Your comment sounds kinda passive aggressive. The video is a summary of a brain storming post on Facebook on potential causes of a future house crash in Australia. You sure you understood it fully? I'm not PK's client by the way, just a follower like you. Cheers.
@@yunusemreerkan6064 hey mate, appreciate your comment. Firstly, I was not passively aggressive while writing that comment, I don’t know what made you to say that by solely just reading comment (without any expressions in it). I personally like PK and leant a lot from him. But, it doesn’t mean I have to agree with him all the time. I was positively criticising for him, where I feel it needed. I have listened to him so much that sometime he contradicts his own data and opinion. If I have to say those points it will be a long comment. I have every right to criticise him (obviously positively), while he put his opinion publicly.
About the war situation... If Australia follows America into war against China/Russia, and continue to provide access to the military bases on our shores, they become targets from those adversaries. You don't think house prices will fall if a nuclear bomb or other missiles hit our shores?
Good point, of course if nuclear, it’s like the asteroid
Fun for all the millionaire migrants coming here. meanwhile locals are left in the dust