Get out of Sydney for $7,000 - would you?

[Propertunity]

The new NSW government os offering 10,000 families $7,000 as a
"relocation grant" to sell-up in Sydney and relocate to regional NSW.

In government, the NSW Liberals & Nationals will introduce a $7000 Relocation Grant for people who sell their property in Sydney and relocate to regional NSW.
The program will be limited to 10,000 grants per annum.
To be eligible for the grant, a family must sell their house or unit in the Sydney region and buy a house or unit outside Sydney. The value of the purchased property must be less than $600,000 and must be the principal place of residence.

It is an interesting policy to come into effect 1/7/11 but it seems they have not yet defined what "regional NSW" really is yet

The NSW Liberals & Nationals will work in consultation with local government and the community to define the geographic boundaries of ‘Sydney’ and ‘Regional NSW’.

This will take some pressure off Sydney and also boost regional NSW if people actually do it. Would you?

 

[laurencei]

I think the problem is "To be eligible for the grant, a family must sell their house or unit in the Sydney region and buy a house or unit outside Sydney."

If you already own a place in Sydney - you wouldnt sell just for $7k.

But if you were LOOKING for a place to live, you might consider regional living for the $7k... maybe...

 

[Tin Tin]

If it was offered to me in brisbane i wouldnt do it, which would lead me to believe i would have the same response if living in sydney. 7k for the hassle? laurenci is probably right.

 

[Felixter]

Can't see a lot of people jumping at that. At most it will spur into action people who were already considering it.

- Move to the country where wages are much less than $7k. And that's just in 1 year

- Sell your Sydney property that will most likely grow by more than $7k per year that a regional property?

It just doesn't stack up financially. Why do Governements insist on making unworkable policy?

 

[charlieandkath]

Sounds like a good stamp duty revenue raiser. 10000 times 20k plus 10000 times 10k equals $300,000,000. Clever Mr O'Farrell. Forgot to minus the 10000 times 7k so still would raise $230,000,000.

 

[charlieandkath]

Would allow all the wealthy people in Sydney that were thinking of moving to the Southern Highlands (Bowral area) to move for free.

 

[twobobsworth]

Once you leave you can never come back.

 

[gottabespotless]

- Move to the country where wages are much less than $7k. And that's just in 1 year

Only if you work in private industry. And don't forget that it costs a lot more to live in Sydney than it does to live in, say, Port Macquarie or Armidale. I would guess that a $100 000 salary in Sydney would be the equivalent to a $60 000 salary in regional NSW? (or somewhere there abouts...) Think cheaper housing, no tolls, no parking meters, cheaper schools for kids, cheaper most things really.

I could see lots of nurses, ambulance officers, fire fighters, school teachers, Police, etc, who work for the NSW Govt taking up the offer. They are paid according to level, years of service, rank, etc and they get paid the same whether they are working in an expensive suburb of Sydney or a much cheaper regional town. Although they would already receive transfer costs, etc, I wonder if they would also be entitled to the $7000 sweetner. Methinks not.

 

[RumpledElf]

Once you leave you can never come back.

I moved out of Adelaide about 5 minutes before the boom hit. After years of house prices being mostly flat so I didn't even think it would happen.

It has effectively locked me out of the market.

 

[Sheryn]

Advantage to g'ment

I have family members in Sydney who would like to move back to the country.

The rent a house (they are the tenants) in Sydney and have had their PPOR in the country rented out for 10 years.

I don't think this will help them move.


Sheryn

 

[DaveM]

$7k wouldnt even come close to covering the selling agents fees on the sydney home, let alone stamp duty on the new home, or moving costs, or anything else.

What incentive is there financially for a meagre $7k?

If they wanted to get serious, they would have made it $24k and also waived stamp duty on the regional purchase as an extra incentive.

 

[tom32]

I hope this isn't O'Farrels answer to the infrastructure issues in Sydney. Bribe people to move away?

wow visionary stuff...

Most of the 10,000 who take this up will already be on the cusp of deciding anyway, which I am sure is his intention, no one would be expected to go, $7,000.00 I am packing my bags and putting the house on the market, let me get my chequebook to pay the RE agents commission...

As two bobs is hinting above the rules around it will likely be so prohibitive that to take it up means you must not reside again in Sydney for some ridiculous amount of time too.

 

[devo76]

I think the group most likely to take advantage of this would be the lower to middle wage earners that are struggling a bit. They might be on the fence as far as getting out of Sydney or staying goes.
Probably not a lot of savings so any move will be a financial burden.
This cash grant may be enough to convince them to move out and live a cheaper yet happier and less stressful life in the regionals.

Did I mention it was about 10 minutes from work to home this afternoon. Bliss

 

[Property Meister]

hell no, $7k is not a lot at all in the grand scheme of things, would $7k be worth your happiness? (assuming you accepted on monetary grounds only)

$30k, and then id just start to think about it

 

[cadence]

a financially illogical incentive from a financially incompetent government targed at financially illiterate people

 

[topcropper]

Once you leave you can never come back.

Not neccesarily.

Anyone who sold in Sydney in 2003, and then bought in Tamworth in 2003 saw their Tamworth house price double to 2006, whereas in Sydney it did nothing. And regional areas have probably still seen more percentage growth than Sydney since 2003 even though Sydney has seen more growth just recently.

Of course, if you sold in Sydney in 1997 and moved to Tamworth in 1997, it worked the other way, as Tamworth did very little from 1997 to 2003, and Sydney would have doubled or more. It depends a lot on the cycle and timing.

People who sell a house in Sydney might have enough money to buy acreage in a regional area, and if you want capital gains, acreage is one way to get it too. Lifestyle blocks and small farms around regional towns have been spectacular investments in the last decade.


See ya's.

 

[skater]

I think that if the only incentive they are willing to give is $7k, then they are targeting the wrong demographic. Unless you are already contemplating a move, a home owner would be mad to even think about it for the reward.

On the other hand, the $7k incentive might be attractive to a renter. It could cover their costs with a little spare. Even if they are thinking about moving, someone on a low income(centrelink payments) might find the costs or relocating to somewhere regional hard to manage. If they were to put teasers up in the centrelink offices for people to see how much the rent is in outlying areas, you might find some takers. This would help ease the pressure for rental properties.

 

[gottabespotless]

Not neccesarily.

Anyone who sold in Sydney in 2003, and then bought in Tamworth in 2003 saw their Tamworth house price double to 2006, whereas in Sydney it did nothing. And regional areas have probably still seen more percentage growth than Sydney since 2003 even though Sydney has seen more growth just recently.


See ya's.

I couldn't agree more with this. I have friends who owned a house in Byron Bay for many years that's value didn't change much during the 20 years they owned it (late 70s to late 90s). They sold it in 1998 and moved to Sydney (Drummoyne) where they took out a bigger mortgage to purchase an old semi that needed work (more expense). Well, when the property boom exploded on the north coast of NSW in 2002/2003 the value of their old Byron house skyrocketed and later sold in 2007 for over $2 000 000 (mostly for the land it was on). Yep - while their semi in Drummoyne has also increased in value considerably compared to what they paid in '98, they are the first to admit that the move to Sydney cost them heaps and it's their biggest regret - they could always move back to Byron but couldn't afford to buy in the same location or have the same size block or house that they had.

I guess that's the 'fun' of real estate!

 

[Aaron Sice]

My thoughts were the stamps as well. What a revenue raiser!

 

[emptyvessel]

I think it might work, here is why

The majority of people are financially illiterate. Like the baby bonus and FHOG, this $7k seems like a alot of money taken at face value by this majority.

I think we might be surprised by the illogical effect of this.

Has anyone read the book, Freakonomics? Human psychology and crowd dynamics sometimes have the most surprising market effects.

I hope lots of them move to Shoalhaven and drive up my rents and values.