Ausprop,i don't have a opinion on that site, i just use it as any other free tool that's out there ,but i find it interesting that the price range of some of those comm-motels properties when compared to other property listing comm sites in this country that i watch,my only conclusions with the scale of money-and backup it takes to come into this country under the visa system-and as most go in blind on their first investment property agents like these would be sitting on a unlimited supply of 0-S investors,cash up and ready to start from day one,and the only statistics they see would be invisible..imho willair..
Anyone read this article yet????
- Thread starter VCDenton
- Start date
Can you expand on this?
My point is that if there is a housing shortage. Wouldn't that shortage (or excessive demand for housing) spill over to the rental market and raise rents much more than they have been over the last say, 10 years. People have to live somewhere. Buy or rent.
In my experince rents are mostly constrained by affordability. ie: wages.
Would someone more knowledgeable than myself care to reply to the initial 2 points in my post?
My point is that if there is a housing shortage. Wouldn't that shortage (or excessive demand for housing) spill over to the rental market and raise rents much more than they have been over the last say, 10 years. People have to live somewhere. Buy or rent.
In my experince rents are mostly constrained by affordability. ie: wages.
Would someone more knowledgeable than myself care to reply to the initial 2 points in my post?
interesting. businesses to order.
I'd say it has more to do with the sophistication of the market. i know property in the UK is an adhoc mess. still the more imperfect it is the more opportunity there is
I'll second that call.. I would say empty houses is a negligible factor. And before holiday homes are mentioned - these are typically way above median values in non-industrial towns... you may as well count boats if that argument is raised
it's always hard to argue someone elses perception, as that is your personal experience. From my POV yields as a % have held up. Do you have any data? (yeh I know it's a drag)
yes, that is probably why spain has a number of posts bigger then Italy and germany together.
about the empty home, it make a huge difference if the empty home is worth 100k $ or 1 mil$, and if the potential rental income is 500$ a month or 2000$ a month.
Ausprop the whole demand side data they are using are assumptions.
And imo they a wrongly based assumptions.
Sure people have to live somewhere, and the trend lately has been towards less people per household, but if people don't have any money and no job, will the trend continue?
Who will rent if they can't afford to pay the rent?
Who will buy if they can't afford to buy?
If those cashed up keep buying, then they will have to lower their rents in order to rent to those same people.
Of course we have the government who thinks they can step in and "stimulate" the economy, but all they are stimulating is themselves, as it will all come back as an inflationary boomerang.
Which means less people can afford to by and or rent.
And imo they a wrongly based assumptions.
Sure people have to live somewhere, and the trend lately has been towards less people per household, but if people don't have any money and no job, will the trend continue?
Who will rent if they can't afford to pay the rent?
Who will buy if they can't afford to buy?
If those cashed up keep buying, then they will have to lower their rents in order to rent to those same people.
Of course we have the government who thinks they can step in and "stimulate" the economy, but all they are stimulating is themselves, as it will all come back as an inflationary boomerang.
Which means less people can afford to by and or rent.
It might be my perception, true. But to me its common sense, no?
On both my points the silence is deafening.
No data, it just seems obvious to me.
On both my points the silence is deafening.
No data, it just seems obvious to me.
I reckon Rudd will step in soon enough and put a ceiling on annual rent rises.
Will win him more votes than it will lose him.
(I think I heard State authorities were hardening up on 'unreasonable' rent rises. Tis a grim reminder that you want to keep your rent rises coming regularly, rather than getting behind then trying to lift them in one go.)
OK - so you are sayign % yields now are lower than they use to be?
Only for certain types of property WW where the Govt perceives the Tenant needs protecting.
The other boring stuff will probably be left to straight negotiation as it has always been.
Only for certain types of property WW where the Govt perceives the Tenant needs protecting.
The other boring stuff will probably be left to straight negotiation as it has always been.
I remember my father cursing and cussing about govt interference in the rental market back in the early 70s, when he had half a dozen houses and two blocks of flats. Even then, the Qld rental tenancy authority kept stacking things against landlords.....and I have more stories than I care to remember about evicting tenants from hell.
It took my mother a while after my father's death, but she finally woke up to how much less hassle there is with shares.....and flicked the resi. My younger brother seemed to learn the lesson as well.....and has always favoured shares over resi.
My parents never made the transition to comm though. They had too many Italian and Greek friends who fueled them with stories of not being able to get a tenant for their industrial sheds for months at a time.
Indeed.....fueling stories of a myth is a dying art. Helps keep the competition down though. I've learnt alot from the wily ol' Italians and Greeks. They are shrewd Landlords in general. Only met one cloth ears, and he was the younger variety with the typical gold chains and lowered undone buttons on the shirt. Didn't have a clue, but his old man surely did.
the other risk of commercial in their days was the galahs in state and local govt..... You could think you were onto a good thing with the town plan limiting commercial competition.....only to find 2-3 years down the track the town plan gets amended.
Qld state polie Russ Hinze was good at this stuff. One of his kick backs went like this:
- Mr Developer needs the town plan changed to accommodate his vision for a new shopping centre or sub division.
- Mr. Hinze has the power to change the town plan, so suggest Mr Developer buy one of his properties for fair market value.....(one that he doesn't really want to sell.
- Mr Developer says ok and puts it under contract with a big fat deposit and long terms.....
- Once Russ gets the town plan changed and Mr. Developer gets his unconditional DA, Mr Developer cries that he can't get finance to settle the terms of the contract on Russ's property.
- Gee guess what. Russ gets to legally keep the big fat deposit.
I think you'll find that before this thread was hijacked it was regarding an article that clearly is trying to tell us the "supply/demand" scenario that drives property markets is a pile of crap (interesting read though). In response, while there are houses out there not lived in (as per the article), it is not the sole indicator that there is no demand. Does that explain it???
it was regarding an article that clearly is trying to tell us the "supply/demand" scenario that drives property markets is a pile of crap (interesting read though). In response, while there are houses out there not lived in (as per the article), it is not the sole indicator that there is no demand. Does that explain it???
the other risk of commercial in their days was the galahs in state and local govt..... You could think you were onto a good thing with the town plan limiting commercial competition.....only to find 2-3 years down the track the town plan gets amended.
Qld state polie Russ Hinze was good at this stuff. One of his kick backs went like this:
- Mr Developer needs the town plan changed to accommodate his vision for a new shopping centre or sub division.
- Mr. Hinze has the power to change the town plan, so suggest Mr Developer buy one of his properties for fair market value.....(one that he doesn't really want to sell.
- Mr Developer says ok and puts it under contract with a big fat deposit and long terms.....
- Once Russ gets the town plan changed and Mr. Developer gets his unconditional DA, Mr Developer cries that he can't get finance to settle the terms of the contract on Russ's property.
- Gee guess what. Russ gets to legally keep the big fat deposit.
What a sweet deal- Russ was the only one of that crew with a brain me thinks.
One story doing rounds:
Russ is pulled over by Police speeding.
Russ: Son, do you know who I am?
Copper: No
Russ (pulls out map of Queensland) : Now where do you want to be transferred to next week? (whilst pointing to Mt Isa)
No different from today at least you had a idea of the "Man" with RussQld state polie Russ Hinze was good at this stuff. One of his kick backs went like this:
- Mr Developer needs the town plan changed to accommodate his vision for a new shopping centre or sub division.
- Mr. Hinze has the power to change the town plan, so suggest Mr Developer buy one of his properties for fair market value.....(one that he doesn't really want to sell.
-.
Hinze,when you look at Labor and the games they play with developers
i knew several people that worked for him,and there is one thing he always paided on time,unlike today..willair..
I can imagine, as a polie, not plssing off your small business creditors would be wise.
If you mess with enough of the right ones, they are bound to bring you down, one way or another.
Some are saying Della Bosca was set up with forbidden fruit.
Hi Evan, I will try to answer. Rents have been rising, and rising strongly. Sydney rents were rising at 10-15% per annum over the past few years. This has now paused, temporarily, because of the low interest rate environment (rent vs buy cost gap has narrowed). Also, at the height of the GFC when properties were difficult to sell, many vendors put them up for rent instead, increasing supply. Many property analysts do expect rents to start increasing again from here. Also bear in mind that rents are partly subsidised by the government through negative gearing, so investors can afford to keep rents lower than would otherwise be the case.
I agree, there is no physical shortage of houses in Australia. But there is a shortage of available houses in convenient locations.
A frequent bear claim is that the critical housing shortage recognised by the RBA, media, major banks, government, HIA, real estate industry, and all property analysts and commentators is actually an illusion. They claim that Australia has a massive number of empty houses that will somehow flood the market at some point in the future when interest rates or unemployment levels get too high. This is incorrect – the percentage of empty houses in Australia has barely changed in 30 years as shown below.
Year Occupied Empty %Empty
1976 4162064 431200 9.4%
1981 4691425 469742 9.1%
1986 5285571 543539 9.3%
1991 5765021 597582 9.4%
1996 6496072 679165 9.5%
2001 7072202 717877 9.2%
2006 7596183 830376 9.9%
Some bears even go so far as to suggest that many property ‘speculators’ are hoarding empty houses while claiming negative gearing deductions. This would of course be completely illegal, and in any case does not make sense from a business perspective, since the investor would be losing rental income while risking severe penalties if caught by the ATO.
Australia has always had empty houses, and an excess of bedrooms in occupied houses, however these empty houses are not necessarily available for sale or rent. And they are not necessarily located in places where people want to live. A house is marked empty if it is unoccupied on census night. Many people are on holiday, out with friends, travelling etc. on census night, so their houses are counted as ‘empty’. This does not mean that the house will shortly become available for rent or sale.
Remote coastal towns always have a large number of empty holiday homes and high vacancy rates, but that doesn't help all the people who work and need to live in Sydney or Brisbane. On census night, there may have been plenty of empty villas in Thredbo and empty houseboats on the Hawkesbury, but again, not much use to the majority of the population who live and work in our cities.
As for the empty bedrooms... well, Australians want empty bedrooms in their houses. We're used to them, and we're not going to start inviting people to share our houses and bedrooms unless forced to by extremely adverse conditions.
High prices and low rental vacancy rates are a symptom of shortage. We see these symptoms across Australia.
Some bears will then respond by claiming there are very few homeless people in Australia, so how can there be a shortage? Where is everybody living then?
The number of persons per dwelling in Australia dropped from 2.97 in 1991 to 2.76 in 2001 and to 2.74 in 2006. So after falling considerably over a decade, this metric has basically flat-lined from 2001. Australians are now bunching up in existing dwellings rather than continuing the trend of forming new households. Why? Because we don't have enough houses to allow people to continue spreading out at the rate they desire.
The Australian population is growing at 1.9 per cent per annum. We can't just keep bunching up into the existing housing stock forever. The government is beginning to recognise this, hence their plan to build 100,000 new 'affordable' houses. But that is a drop in the ocean - we need many more. They will leave that up to the private sector to build (i.e. property investors and private developers).
Unless we develop new stock, we cannot possibly hope to appropriately house the growing population. So where are all these people who contribute to the pent up underlying demand actually living right now? They are:
- Bunched up in existing houses.
- Sleeping on friends sofas.
- Living in caravan parks and campsites (caravan parks in Australia are overflowing).
- Staying with parents for longer then they desire.
- Hotels, motels, backpacker hostels, guest houses.
- Crisis shelter, homeless centres and public housing.
- A small number of people are living on the streets.
Cheers,
Shadow.
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