Oh yes, and the UK property boom was considerably larger than ours to begin with...
Cheers,
Shadow.
Hi Shadow - great info. What's the source? Link?
Difference b/w Oz and UK property markets
- Thread starter Satanoperca
- Start date
Hi Shadow - great info. What's the source? Link?
Thanks, much appreciated.
That would be true in a rational world where people actually took notice of yield! My dream world!
It would seem that if unemployment was to rise significantly and people were forced to sell their property and choose to rent, then while the demand for rentals might increase so would the number of properties for sale increase, thus reducing overall prices. When there is uncertainty in job security and money is not abundant in workers pockets they will always be more frugil including what they are willing to pay for rent, business owners wish to keep money in the business just incase things get worse. When times are good, property prices are high it is often an easier option to spend more on rent and live it up a little - demand increases.
There alway will be a floor on property prices, people including myself always need a place to live, depending on the current economic situations, dictating how much I am willing to spend on either rent or a mortgage and investors waiting in the wings. I have studied the market in my area, prices have reduced but this is still largely based on the property at hand. Location, location, location still applies even when the market is down.
While I have not seen a great deal in list price changes from over a year ago, they have not gone up, I am seeing a marked difference to the start of 08 when you had to offer over the list price to purchase the property, know it would seem that you often have a good chance of securing property 10% below list price. While my sample of sales might be small it is identifable.
While in the process of selling my property I am actively looking for another property to purchase if the opportunity is there and it is only a matter of time. I do not see that I will get 20% of the peak but rather able to purchase property at prices of 3-4 years ago which seems fair given the current economic environment.
As a owner/occupier my reasoning for purchasing may be different to others. I am aware that other markets around the world are sliding and so is Australia, but for the pure investors it must be fun times to try and secure good property at bargain prices. The market may slide down further, but good property at a good price(?) is always fare and few between.
From what I have leant, as long as you can make the repayments and bid time the market will always return after a correction. Part of the equation is getting the property at the right price.
Regards
Benjamin
There alway will be a floor on property prices, people including myself always need a place to live, depending on the current economic situations, dictating how much I am willing to spend on either rent or a mortgage and investors waiting in the wings. I have studied the market in my area, prices have reduced but this is still largely based on the property at hand. Location, location, location still applies even when the market is down.
While I have not seen a great deal in list price changes from over a year ago, they have not gone up, I am seeing a marked difference to the start of 08 when you had to offer over the list price to purchase the property, know it would seem that you often have a good chance of securing property 10% below list price. While my sample of sales might be small it is identifable.
While in the process of selling my property I am actively looking for another property to purchase if the opportunity is there and it is only a matter of time. I do not see that I will get 20% of the peak but rather able to purchase property at prices of 3-4 years ago which seems fair given the current economic environment.
As a owner/occupier my reasoning for purchasing may be different to others. I am aware that other markets around the world are sliding and so is Australia, but for the pure investors it must be fun times to try and secure good property at bargain prices. The market may slide down further, but good property at a good price(?) is always fare and few between.
From what I have leant, as long as you can make the repayments and bid time the market will always return after a correction. Part of the equation is getting the property at the right price.
Regards
Benjamin
I think people in the UK simply reacted to what was happening in the US and Spain. The more interesting question is why people aren't reacting the same way in Australia.
Why arn't people reacting?
Because :
1) Property doesn't go down in Oz it only every goes up.
2) There is an undersupply
3) Rental market is extremely tight
4) the government can and will prevent property from sliding
5) the health of the economy does not effect property prices
6) this is an upward trend due to the influx of FHB.
When the general public start to change their views on the above, people will start reacting but by then it is to late for the majority.
Also if or more likely when and how quickly unemployment rises and people including myself are less reluctant to go into huge amounts of debt for housing peoples mindset to property will change.
I also find it incredible that people believe after the recent stock market crash that property market was not going to be affect. I now of several people who have upgraded there homes, increased demand due to the money they had made of the last seven years on the share market. They are no longer in a position to upgrade after their loses on the share market last year, but are rather trying to reduce their debts level, downgrade the value of their home.
Regards
Benjamin
Because :
1) Property doesn't go down in Oz it only every goes up.
2) There is an undersupply
3) Rental market is extremely tight
4) the government can and will prevent property from sliding
5) the health of the economy does not effect property prices
6) this is an upward trend due to the influx of FHB.
When the general public start to change their views on the above, people will start reacting but by then it is to late for the majority.
Also if or more likely when and how quickly unemployment rises and people including myself are less reluctant to go into huge amounts of debt for housing peoples mindset to property will change.
I also find it incredible that people believe after the recent stock market crash that property market was not going to be affect. I now of several people who have upgraded there homes, increased demand due to the money they had made of the last seven years on the share market. They are no longer in a position to upgrade after their loses on the share market last year, but are rather trying to reduce their debts level, downgrade the value of their home.
Regards
Benjamin
This dude talks about the difference.
http://www.macquariedigital.com.au/default.aspx?page=videodetails&videoid=5304
I sold out of London 1 year ago, just before Market turned in Feb 08. As someone said, it turned suddenly, not gradually. Failing banks, no credit and a sudden realisation that property prices were way above the long term normal growth path hit home.
There are a lot of negatives to buying/selling in the UK compared to Australia, it's a pain, but despite them I might buy back in if prices drop enough (like another 15% on top of last years 15% drop).
http://www.macquariedigital.com.au/default.aspx?page=videodetails&videoid=5304
I sold out of London 1 year ago, just before Market turned in Feb 08. As someone said, it turned suddenly, not gradually. Failing banks, no credit and a sudden realisation that property prices were way above the long term normal growth path hit home.
There are a lot of negatives to buying/selling in the UK compared to Australia, it's a pain, but despite them I might buy back in if prices drop enough (like another 15% on top of last years 15% drop).
I agree these are views held by Australians, just as they were widely held beliefs in the UK and US once too. My question was why did the British learn from America's example that these were myths, yet Australia hasn't.
I have explained this to Shadow before, yet he doesn't seem to take anything on board.
0.6% (the actual pop growth) of the UK population represents the same number of people as 1.7% of Australia's population. So both countries are adding approx. 350,000 people per annum..... considering the UK is a country the size of Victoria - well, you can imagine how Shadow's choice of words is somewhat misleading!
But most of the population of Australia don't want to live in 99% of Australia. 90% of the population want to live in a major city (and there's only about half a dozen of them). OTOH, the UK & US are much more homogeneous regarding desirability of location.
A recent Senate report contains the table below..... the US & UK have 17-18% of their population in the 2 largest cities, whereas Oz has 54%.
Hang on - 54% in our two largest cities? Sydney = ~4.5 million Melbourne = ~4 million (being generous and rounding up) = 8.5 million.
8.5 / 21 = 40%.
Meanwhile, using that table, New Zealand has 66% of people living in the two largest cities. This is not preventing a housing bust there.
8.5 / 21 = 40%.
Meanwhile, using that table, New Zealand has 66% of people living in the two largest cities. This is not preventing a housing bust there.
If you are going to look at population numbers in the two largest cities lets also look at the migration movement between the two countries. Maybe that could shed some light on why our prices are not busting like they did there. Anyone has the figures for how many aussies are moving to NZ and how many kiwis are moving here ?
A fast search gives this
http://theyworkforyou.co.nz/portfolios/prime_minister/2008/sep/09/nz_australia_migration#national_3
I'll try and find something better
Its on here as well
http://www.parliament.nz/mi-NZ/PB/D...3-New-Zealand-Australia-Migration-Economy.htm
Dave
http://theyworkforyou.co.nz/portfolios/prime_minister/2008/sep/09/nz_australia_migration#national_3
I'll try and find something better
Its on here as well
http://www.parliament.nz/mi-NZ/PB/D...3-New-Zealand-Australia-Migration-Economy.htm
Dave
lol, well, a couple of things:
Yes, the argument is flawed. it's actually 38%, not 54%. Doesn't exactly create much respect for this report does it?
also, we're using percentages again and this might support the argument presented by Keithj, but i could just as well argue that with the Uk having a population of 61,000,000, a population density of 12% represents a much higher figure (7,500,000) than 20% of 21,000,000 (4,300,000). So London is still squeezing in almost twice the amount of people into it's largest city than our largest City, yet their property prices are plummeting.
hang on, i thought it was supply and demand. Surely a growing 7,500,000 population would sustain property prices?
lol
Note - the 2 largest cities in the UK are London & Birmingham. London represents 12% of the total UK population and Birmingham only 7%.
In Australia the two largest cities DO each contain a relatively high 18-20% of the population, though after Sydney and Melbourne this figure drops sharply down to 9% and below. But hey, it was a good use of figures for the argument presented by Keithj.
cheers
Sure.... different sources will give different statistics - they'll use different population areas. According to wiki - London has pop 7,172,091(12%), and Birmingham 970,892(1.5%) (total of 13.5% in top 2 cities).... and agrees with your figures of 3.8M for Melb & 4.3M for Syd (total of 38%).
If I wanted to pull out a statistic to prove a point, then how about 64% of Australians (src:ABS) live in a capital city (on v. limited & desirable land), but in the UK only 12% do.
I think you understand the point that there is v. little desirable land in Australia, and 64% of the population choose to live in a v. few v. small areas. This land is consequently expensive. The other 99% of Australia is far less desirable - even though as you correctly & irrelevantly point out the whole of the UK fits into Victoria
.OTOH in the UK, the land is a lot more homogeneous with the population spread around fairly evenly. There are 65 cities with poplns of > 100K (containing 34% of the popln). The rest (66%) live in v. roughly equally desirable land spread fairly evenly around the country.
I don't understand your point about 7,500,000 growing population ???????
No rogue, it's not that I 'don't take anything on board', it's just that I disagree with your flawed analysis. It's the percentage increase that matters, not the absolute increase. You do realise that are a lot more houses in the UK than there are in Australia, right? And that much of Australia is uninhabitable? And that Australia has less cities than the UK?
By your reckoning, a country with a population of one million people could just as easily absorb half a million new arrivals as could a country of 1 billion people.
Cheers,
Shadow.
To your argument it matters, but why does it matter overall?
Um. Duh? More people. More houses. They were also crying housing shortage before their recession too.
We have plenty of houses. I don't know any homeless people on account of not being able to find a house to buy or rent. Do you? In fact, the Govt is actually PAYING people to buy houses now. Amazing huh? Some capital cities experienced falls in house prices of up to 4% last quarter. Interesting considering we don't have enough houses.
Australia has plenty of habitable land. It might be a small amount compared to the size of the total country, but considering the massive size of our island - the UK has less habitable land than we do. Don't be fooled by this misconception. Also, don't be precious about your own idea of what constitues 'habitable'. Plenty of cities around the world are built in deserts (vegas, dubai etc).
This is simply not true Shadow. The largest city in the UK is London with 7.5m pop. The 2nd largest is Birmingham with 3.5m pop. The 3rd largest is Glasgow with 620,000. The list goes on, but all remaining 'cities' contain only a few hundred thousand or less people. Hardly 'cities'. More like 'towns', comparable to regional towns in Australia (mackay, rocky, bendigo etc). In fact, Australia has far more cities with populations over 1 million (7 i think).
They even manage to fit 7,500,000 into one city. No reason we can't do the same eventually.
I'm not sure exactly what you mean, but London population absorbs an extra 80,000 a year, compared to an average 40,000 for our biggest city Sydney. Now population of London is approx. double Sydney. Double the size, double the population growth. Makes sense to me. I don't know why it doesn't to you. ?????By your reckoning, a country with a population of one million people could just as easily absorb half a million new arrivals as could a country of 1 billion people.
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It is a bit pointless this discussion as it is like the husband arguing with his wife and of course they are both right. Canada probably is better comparison also because of commodity related economys. home prices there like Australia peaked much later at beginning of this year, probably Montreal and Ottawa even June-July. Now they are falling in every city, specially the more expensive Vancouver and Calgary.
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