4 ms·

> Australia’s obsession with property is firmly entrenched in the nation’s economy and psyche.. The article's quote seems to be accurate from my anecdote. I v

> Australia’s obsession with property is firmly entrenched in the nation’s economy and psyche.. The article's quote seems to be accurate from my anecdote. I visited Sydney recently, and the tour guide taking me to the blue mountains started his trip by driving through neighborhoods to point out the ridiculous home prices. I thought it was strange, but then everyone I met was eager to discuss the home prices, or asked me the price of my home (in the US). It seemed the housing market is on everyone's minds.

chris_wot 9y ago
Yep. I bought in a newer area, quite a distance from the city. I paid about $760,000 for it. It's not huge, and apparently after 2 years it's close to $840,000. That's insane.
- cletus 9y ago
  That's an annualized growth rate of 5.13%. How exactly is that insane? If you assume inflation is 2-3% the real rate of return is ~2.5%. The YTD return for the S&P 500 is 18.6%. Now that's insane.
  - conanbatt 9y ago
    The last year for S&P has been tremendous. I truly wonder in this age of high asset prices, which assets are relatively best. Stocks won the last couple of years but after that
  - ganeshkrishnan 9y ago
    You are discounting the leverage of home loans. With 100k down payment you get 5% of 1 million dollars returns which is 50k a year or 50% growth of your investment
teddyh 9y ago
— When the market is on everyone’s mind, it’s time to sell. Joseph P. Kennedy, 1929 (paraphrased)
- conanbatt 9y ago
  I want to say that in argentina, housing prices doubled in a few years up to 2009. Argentina housing was not hit by the Great Recession because we had no debt associated with housing. Housing prices didnt drop at all, and they were still very high by people's income. I predicted that prices would drop, the same way people predict now that housing prices will drop. 8 years in, and prices grew organically from that point. It is exceedingly difficult to lower housing prices without a direct hit.

chris_wot 9y ago

Yep. I bought in a newer area, quite a distance from the city. I paid about $760,000 for it. It's not huge, and apparently after 2 years it's close to $840,000. That's insane.

cletus 9y ago
That's an annualized growth rate of 5.13%. How exactly is that insane? If you assume inflation is 2-3% the real rate of return is ~2.5%. The YTD return for the S&P 500 is 18.6%. Now that's insane.
- conanbatt 9y ago
  The last year for S&P has been tremendous. I truly wonder in this age of high asset prices, which assets are relatively best. Stocks won the last couple of years but after that
- ganeshkrishnan 9y ago
  You are discounting the leverage of home loans. With 100k down payment you get 5% of 1 million dollars returns which is 50k a year or 50% growth of your investment

teddyh 9y ago

— When the market is on everyone’s mind, it’s time to sell. Joseph P. Kennedy, 1929 (paraphrased)

conanbatt 9y ago
I want to say that in argentina, housing prices doubled in a few years up to 2009. Argentina housing was not hit by the Great Recession because we had no debt associated with housing. Housing prices didnt drop at all, and they were still very high by people's income. I predicted that prices would drop, the same way people predict now that housing prices will drop. 8 years in, and prices grew organically from that point. It is exceedingly difficult to lower housing prices without a direct hit.