Capital Appreciation in 2006 ?

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What do ye reckon the level of Capital Appreciation for property will be in 2006 ? I reckon myself 6-7%
 
Is that on the proviso that interest rates go up by no more than 0.5% throughout the year?
 
don't forget the most important aspect of the guess - location, location, location!
 
Easier to talk about 2005 at this point :)

Should we consider 2005 the year that funds locked into Irish property were seriously left out of the global growth train ?

The latest from Permanent TSB/ESRI: "The index says that the overall value of house prices nationally rose by 8% in the first eleven months of the year"

Compare that 8% with
1. Natural resource funds( oil related) up 43% in 2005
2. Emerging market stock funds: up 30% in 2005
3. Japan Funds: up 24% in 2005
4. Diversified Pacific/Asia funds: up 23% in 2005
5. And (drum roll...) Latin American Funds: up 54% in 2005

(p.s. for property and other assets, past performance is not a predictor of future etc. etc.)
 
Coffee Brew not comparing like with like due to leveraging of returns in property portfolio. For example at 80%ltv getting 5 times the annual return provided rent covering expenses. For what it is worth I would say property will underperform equities on a pound for pound basis but as a leveraged play (as most property portfoios are) property will continue to outperform equities. The fun will only begin if property starts to go appreciably south in value as the leveraged investor will suffer much greater losses than the annual decrease published.
 
You can indeed leverage into stock and fund purchases. Many people do.

It's risky though because as with leveraging into property, losses can be amplified in a downturn.
 
And I am one that is leveraged into stocks but you need to have over 50k to do so in my experience. Also not many over 50% leverage. If you are leveraging using other vehicles like spread betting and options you can lose all monies. My point is that when people look at these figures at face value they feel it is no longer the time to be in property. Even if growth rates of inflation or less property is still a good investment.
I just hope people are not churned out of property in favour of equities by advisers based onthe figures quoted as leveraging in proeprty is not stressed enough in calculating returns in my humble opinion. I feel the vested interest of the banks etc do not want to stress this fact as there in general seems to be a better margin on equity products than property investments. Also as a mortgage reduces the bank make less but as an equity fund grows the bank's cut increases via management fees.
Interest rates are also historically low and inflation nearly pays the mortgage (but for how much longer)!
 
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