Note by Greg Canavan What’s the outlook for the Australian property market after this COVID crisis? Are we going to see a major house price crash in response to reduced economic activity? A mere ‘softening’ in prices? Or will values hold up until the lockdown ends and auctions can resume? This is such an important discussion — for all our readers — that we’re taking over the plum spot in The Rum Rebellion each day until next Wednesday to consider all the possibilities. We’ve asked two of the country’s biggest real estate experts, Catherine Cashmore and Callum Newman — from Fat Tail Media’s Cycles, Trends & Forecasts — to weigh in with their thoughts in a series of property-focused guest essays. Now you’d think that with the country on lockdown...auctions banned...and viewings restricted to online only...the property market would be bound to topple over this year. Not so, say Catherine and Callum. So far, in this guest essay series, they’ve moved to reassure homeowners and real estate investors that we’re unlikely to see a major real estate crash this year...more of a slowdown. More interestingly, they say that this market slowdown was expected...and in fact they’ve been predicting it for years. This is thanks to a wider idea...about economic cycles...that we’ll get into on Wednesday of next week. It’s fascinating stuff... But let’s get back to today In today’s guest essay, you’ll get the chance to hear a conversation Cal and Catherine recorded a week or so ago with cycle-guru, renowned author and real estate investment legend Fred Harrison (he joins on the phone from the UK). They talk more about this idea of a ‘mid-cycle slowdown’ in the housing market...and go on to discuss where their analysis shows property is headed in the short-to-medium term...when they believe the big real estate crash is finally likely to happen...why governments are ‘uncivilised’...and the future of real estate as we know it... Read on below... ********** Which Way Will the Housing Market Go from Here SPECIAL REPORT by Callum Newman
Dear Reader, Imagine there was a kind of ‘silent rhythm’ that guides all asset price movement... ...a predictable pattern that can help you forecast stock and property market booms and busts well ahead of time. What kind of advantage could knowledge of that rhythm give you? Well, someone who understands this advantage better than most is UK cycles guru, Fred Harrison. | Source: creative-conscience.org.uk |
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Fred, pictured right, predicted the financial crash of 2008 in 1997... 11 years before it happened! He also predicted the recession of 1991 — back in 1983. He made these remarkable forecasts using his knowledge of the 18-year cycle. I first interviewed Fred back in 2015. And when he explained it to me — the relationship between bank credit and land values...how it waxes and wanes in a logical pattern — it just made perfect sense. --------------------THIS COMING WEDNESDAY-------------------- STARTLING NEW VIDEO: Australian Real Estate Expert Catherine Cashmore Reveals COVID-19 House Price Prediction: ‘Aussie property is about to get as cheap as you’re potentially going to see it in your lifetime…’ But the downturn will be swift, she claims, and there is an enormous property boom on the other side of it... COMING TO THE RUM REBELLION: 6.5.20 --------------------------------------------------------------------------------- It helped solidify everything I’d learned up to that point. Fred’s template — 14 years of generally rising prices, with a mid-cycle slowdown, followed by four years of falling prices — quickly formed the basis of my own investing strategy... ...and it’s this same strategy Catherine Cashmore and I share with readers of our newsletter, Cycles, Trends & Forecasts. Anyway, with all the chaos and uncertainty of recent weeks fresh in the mind, I wanted to talk to Fred again. I wanted to get his take on how the coronavirus crisis is affecting the 18-year cycle...and whether it reveals where property prices are headed from here. You can listen into our conversation here. (Catherine joins us part way through, as well.) Fred is an intellectual powerhouse. But he speaks so plainly and eloquently, it really is a joy to talk to him. Please take this rare opportunity to listen to him in full flow. You’ll learn... Why Fred believes the 18-year cycle will continue — after this mid-cycle slowdown — to push house prices up to our expected peak in 2026…How governments are preventing a much bigger, nastier downturn now and the effect this will have on land values…The reason politicians never address the dangerous and systematic issues in the economic system that cause these crashes in the first place…The distraction and foolishness of Modern Monetary Theory…And more! It’s a fascinating insight into a theory that explains a lot about why markets move the way they do...and how you can use this knowledge to predict what’s likely to come next. Listen to our interview with the Grandfather of the 18-year real estate cycle here Sincerely, | Callum Newman For The Rum Rebellion |
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