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Thread: Black Friday!

  1. #1
    Join Date
    Aug 2003
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    7,759

    Default Black Friday!

    Best not to listen to the news or read newspapers from now on in....it's all doom and gloom for the markets, property values etc.

    Even the article by Mike Pero - is a spin on gloom re. investing in Kiwi Saver may prevent your ability to secure a mortgage here's the article

    Cheers,

    Donna
    PropertyTalk Blog - property articles - About PropertyTalk

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  2. #2

    Default

    Tomorrows is Friday in the US so it'll be interesing to see what happens.

    The Dow has already dropped 387 points today - the second worst this year.

  3. #3
    Join Date
    Sep 2003
    Location
    High up above and deep down under
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    10,915

    Default

    DOW Jones down 31 points for the day to 13,239

    52 week range 11,044.72-14,021.95
    "There's one way to find out if a man is honest-ask him. If he says 'yes,' you know he is a crook." Groucho Marx

  4. #4
    Join Date
    Jul 2003
    Location
    Kapiti in New Zealand
    Posts
    4,032

    Default

    On CNN they had a news item on what is the cause of the down turn and it points back to the USA's version of "low doc" or "no doc" loans.

    People who cannot afford "normal" mortgages are going for the loans where the ability to prove that you can repay the mortgage repayments is not a big deal. Thus many are defaulting on repayments and filing for bankruptcy thus taking down the lenders as well. Which in turn affects the share market.

    All of this is mentioned in the "Maxed Out" book and from what the experts in the book talk about this is just the tip of the iceberg.

    Its the greedy lenders giving loans to people that should have a better idea on how much they can afford that is causing this issue.

    Cheers

    Marc
    Free business resources - www.BusinessBlogsHub.com

  5. #5
    Join Date
    Apr 2005
    Posts
    787

    Default

    People who cannot afford "normal" mortgages are going for the loans where the ability to prove that you can repay the mortgage repayments is not a big deal.
    Sounds like New Zealand?
    Its the greedy lenders giving loans to people that should have a better idea on how much they can afford that is causing this issue.
    The trouble starts when the lenders get stung and then change the rules for a new game where they decide who the players will be....full disclosure!

  6. #6
    Join Date
    Jun 2005
    Location
    Auckland
    Posts
    3,936

    Default

    News this morning has reported.
    In NZ there is now an increasing level of bankruptcy's and inability to pay mortgages.

    I wonder if this is the tip of the iceberg? It will take a little while for stats to flow thorugh into market place however.

  7. #7
    Join Date
    Jul 2003
    Location
    Kapiti in New Zealand
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    4,032

    Default

    Quote Originally Posted by whitt View Post
    News this morning has reported.
    In NZ there is now an increasing level of bankruptcy's and inability to pay mortgages.

    I wonder if this is the tip of the iceberg? It will take a little while for stats to flow thorugh into market place however.
    I think its coming - just take a look at all the flash new housing developments around the country with a flash brand new car out the front.

    Then check out "Harvey Norman" stores in the weekend with people buying the latest TV's, computers and other useless gadgets - I bet 99% of those purchases are done on credit. So they have a high mortgage and credit debit to deal with every month.

    Cheers

    amrc
    Free business resources - www.BusinessBlogsHub.com

  8. #8
    Join Date
    Jun 2005
    Location
    Auckland
    Posts
    3,936

    Default

    Cheers

    amrc
    Whos he?

    Maybe a new member to PT.

  9. #9
    Join Date
    Jun 2005
    Location
    Nelson NZ
    Posts
    3,864

    Default

    I have just read todays article on downsizing to pay the mortgage. That property owner had to sell because of an increase of $150 per week increase in payments. Well I put the figures through my calculator and I think that person would have had a mortgage of $600.000. What sort of fool has a mortgage of that size on the house he lives in and apparently no other investments. Even at Aucklands prices they had a real nice house way in excess of most peoples ability. I guess their house would have been worth say $800,000. Now really for a young couple with no kids to have a house of that value.
    They deserve to get what they have sown. Nuts.
    What ever happened to saving and going without.
    Sure investors can have these sorts of mortgages but then they should also have some equity.
    I wonder how much drop in values / rate increases there will be before I can go in for the kill and buy up some under valued properties.

    Do we have some ideas out there forumites.

    What will be the peak interest rate this round.

    What will be the average drop in values before the old guys start buying up.

  10. #10
    Join Date
    May 2004
    Location
    Bay Of Plenty, NZ
    Posts
    3,604

    Default The coming tidal wave

    It's been interesting reading this thread.

    I am continually looking for properties to buy. Yes, I am particular but the properties that are cashflow positive are out there.

    All this hu-haa about the US sub-prime market - really, did they expect that NOT to happen??!! Giving loans to people who don't generally qualify for "normal" loans, low start-up interest rates and credit cards to utilise - what did the banking nutters expect.

    It's all very well the Banks using lo-docs turning them into Bonds, selling the Bonds to private equity companies etc etc etc when at the end of the day, if the mortgagors default on the loan, it just means there's less money in circulation.

    It doesn't take a rocket scientists to work out there is a "credit crunch" happening.

    It was created by Banks/investment companies with their "innovative" banking systems.

    It serves the Banks right to get into this problem.

    There will only be a period short of time (if it hasn't happened already) before the "credit crunch" leaks into main street America. When that happens, there is going to be HUGE problems for everyone.

    Stand by to wait.
    Patience is a virtue.


 

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