Australia housing bubble

[Citroënbender]

Originally Posted by John 13

WA government effectively bailing out large over committed "builders" in order to get homes completed. Appears that some MAY have used a pyramid scheme; over committing, tying up customers with contracts and then using new customers deposits to fund jobs in hand.

Who’da thunk it? Builders front-loading contracts to finish prior jobs.

I’m not sure if it’s technically a pyramid scheme but quite likely trading insolvent.

[fordomatic]

Originally Posted by Syndrome

Increasing interest rates are causing cash flow issues. Yet house prices continue to rise. Auction of a local property on the weekend makes me shake my head in dismay.

Crazy isn't it, when does it end............

[b0son]

The HIA contract needs to be set in stone. No alterations. Ours had so many standard clauses crossed out and alternatives put in that were entirely in the builders favour. Went through a solicitor, but they didnt pick up on the implications, so clearly they're not worth their money. If the contracts were 'reasonable', you wouldnt need a solicitor in the first place IMO. The payment schedule was massively front-loaded, and even though the bank looked it over, they didnt pick this up. Useless. It's all obvious once you've been through the process, but hindsight is pointless. The contracts need to be rewritten with this knowledge going in. Preferably by someone other than the HIA who have a vested interest.

[Sprintey]

Originally Posted by fordomatic

Crazy isn't it, when does it end............

Used to think that things like endings happened, or reversions to means or whatever you want to call that, but now realise they will let everything else end before letting housing end. It's the dumbest thing to punt an economy on, it's not productive but rather restricts economic activity in productive sectors as land and rent rise. But here we are.

[Citroënbender]

It will “end” when a balance is reached between peoples’ notion of property ownership and their tolerance of lifetime debt.

Which I personally consider a big part of our pig-headed “race to the bottom” but if it’s what people think they want, they’ll only be unhappy if denied it.