The video with this one is a cheerleader's special and has nothing to do with the article. Something odd about an Australian trying to speak extra clearly. Really has to open his mouth wide. (Just a random aside...) Maybe it's a spruiker thing?
Home owners face repayment disaster
Property analyst Mark Armstrong predicted appreciation would be slowest for home owners in outer suburbs, who could see negative to zero growth in values for as many as 20 years.It's not the slowing of credit after a bubble that leads to negative equity, it's building a cheap house on valuable land. That's a different viewpoint...
''It's the perfect storm of conspiring factors,'' the director of iProperty Plan said. ''The average plot of land in the outer suburbs is [worth] half what it is in the middle suburbs and it is the land that appreciates, albeit slowly on the fringe. The houses they are building actually depreciate.
''On top of that, the quality of construction is often cheap. So that's what's behind the negative equity.''
Bear with me a second, if the land holds all the value, and the building is a liability, wouldn't you want the cheapest building possible on the land in order to best maintain the total asset value over time?
Kevin Bailey, principal at Shadforth Financial Group, said his warnings three years ago of a ''homegrown subprime crisis'', created in part by inflationary first home buyer incentives, are now playing out. He said the schemes enticed mostly young people, without savings, to borrow heavily and pay a premium for low quality housing in poorly serviced locations.You sold your children's future to the bank. Feel good?
''Lots of baby boomer parents who have made money out of property gave sage advice to children to pour their money into bricks and mortar because prices double every seven to 10 years,'' he said.
''Young people who were sold that lie will find it very difficult to escape and it's a tragedy.''