Investors keep first-timers out of market

Medians & averages are different. You would not get two full time wage earners earning $1234pw. Remember, she said that they were earning ABOVE average wages EACH!!!

Yes, medians are more accurate as the average/mean is easily skewed by extremes. But my post was replying to sanj's post (above mine), not commenting on Kathryn's.

To answer whoever asked, the median household income in the Sydney metro area at the same time was $1447.

On second thoughts, my previous post about putting extra payments into our mortgage is not too shabby. It'd be paid off by the time I was 38 (on a current net combined income of 75k - house was bought for 450k) which is quite impressive considering I have colleagues at work in their mid 50s who still haven't done it. But travelling is so tempting :p
 
Hmm, another calculation done on one of those extra mortgage repayment calculator thingys says we could get the same result even by just paying the minimum fortnightly P&I repayments upto year 5 of the loan (my husband will be well and truly finished uni by then so our income will be close to double what it is now) and then putting $2000 extra in per fortnight. This would be a worst case scenario as we could easily save a lot more going by our current rate. I'm excited now - I can have my overseas trips and a paid off PPOR before 40. I'll go away now :p
 
If a couple work 38 hours each, earning just $20 an hour, they will get $1330 after tax. If they spend $330 per week on expenses excluding mortgage and property expenses, they have $1000 per week to go towards their house. A $300,000 house can be paid off 7-8 in years.

By incorporating some other strategies like second jobs, rent out a couple of rooms etc, they may manage to pay off in 6 years.

Edit: If they buy a $240,000 house, they can pay off in 4-5 years :D
where would they buy the $240k house?

Remote and/or dying Country towns don't count - the majority of FHB's won't go to those areas.
 
you are again missign my point.

this in no way answers ideo's question which was "Would you be able to find a property within commuting distance of, say, Paramatta, that you could get a mortgage for that could be paid off within 4 years on a lower than average wage"

kathryn's effort was definitely commendable however that is not what the question is about.

realistically, how easy/difficult would it be for someone to do the same in australia if they were on an average or below average wage?

I think we're splitting hairs again here.

Ideo's question was in reply to Kathryn's post. I assumed that he hadn't really read all of what Kathryn had said & wanted to know if someone here could duplicate what Kathryn had done, based on the same variables that Kathryn had given.

I've just shown that it could be done easily by someone with Kathryn's mindset on a similar income level to Kathryn's family, but that aside, even if we go to a below average wage you will get a good outcome.

Let's halve it, shall we. That REALLY is below average. Imagine a couple, both on $40k. Again, if they live on one income only & funnel the rest into the mortgage, it might not be paid for in 4 years, but it will be paid for extremely quickly, even more so if they took in boarders.
 
So $240,000 houses do exist! As Kathryn mentioned, if a couple is earning 40% above average or 80k each, they can actually pay off these houses in 2-3 years, not 4 :D
 
So $240,000 houses do exist! As Kathryn mentioned, if a couple is earning 40% above average or 80k each, they can actually pay off these houses in 2-3 years, not 4 :D

No... cannot possibly be done :D:p

.... except by those who REALLY, REALLY want to do it. ;)
 
This is post #269...I think everyone bypassed it?
I searched yesterday and found examples of rentals to live in and a house to buy.
On a google search, it stated $57K was an average Australian wage.
Another google gave me how much tax to be deducted.
Since Cimbon is in Canberra..I picked this area, and kept everything within 20 kms of the CBD.


Here is how 2 median Australian paid workers can own a house in 7 years.
The numbers won't exact. $57k is considered median wage?
I used Canberra for this example.


$57k= $10,972 tax
=46,028 x 2 people=92,056 net

$75 food wk=$3900
$50 misc wk=$2600
$100 transport wk= $5200
granny flat- $295 wk (all bills + internet included) = $15,340
http://www.gumtree.com.au/s-ad/karab...ews/1032273910
17kms or 23 minutes away Canberra CBD

=27,040 expenses p.a.
=65016 savings p.a
take this money and put as deposit on a house.
Here is one for $435k and is close to Canberra CBD (according to the map) 17.7 kms or 25 minutes.

http://www.gumtree.com.au/s-ad/dunlo...el-/1032214873
$435k

$5959 mortgage a month for 6 years @5%
saving a month $5418 +845 rent (@195 wk)
=6263

At this point, keep working and save until the first baby is born.
Then one parent can quit work forever and care for the children.

It isn't hard..it just takes discipline.
 
Cimbon,
Ok...I just thought everyone thought my husband and I earned $80k each.

I stated clearly we made a combine $23k + any overtime in 1982.

Minimum wage was $3.75 an hour, in our province, and we would be around the $5.50 hr mark.
Our work weeks are based on 40 hrs.
 
It was assumed that in today's dollar value you will be earning 80k each! But I reckon it could be less than that.

You gave a good example Kathryn! Yes that can be done. In real life in the last couple of years we found that actually we can pay off PPOR loan in 4-5 years! But instead of paying off, we invested and will create equity equivalent to our first house price soon. And our average wage is just $22.
 
id thought id throw an example out,

im from vic, from the west,

it seems the entire generation y has been labeled as unappreciative and a sense of entitlement, but leaving that aside,

those that say, "oh when I was your age, my first house, didn't have any running water and rats were running around" type of comments,

sure in 2013, you can pickup a dump dump of a house which is about to fall over in metro Melbourne, for say $150k, but surely you cant expect entitled or not first home buyers to live in places like that,

so where do you guys think draws the line to acceptable,

my 2c would be a 2nd hand slightly run down house in melton or west for $220k ish

or maybe run down lilydale and surrounds for about the $280k mark
 
It was assumed that in today's dollar value you will be earning 80k each! But I reckon it could be less than that.

You gave a good example Kathryn! Yes that can be done. In real life in the last couple of years we found that actually we can pay off PPOR loan in 4-5 years! But instead of paying off, we invested and will create equity equivalent to our first house price soon. And our average wage is just $22.

Thank you.
If I still worked at that factory, I would be making around 15.50 an hour.. (32k)
It is still an average wage.

Minimum wage there is $10.30 an hour

In 1990 we sold that house and bought a larger one.
We took our first ever mortgage for $45k
My parents gave all us kids a piece of land, which I sold for $10k and put on the mortgage. I was still a SAHM but provided child care in our home.
In 5 years we had this mortgage paid off...when it was origianally for 25 yrs.
 
My parents were new immigrants and paid off their first home in 6 years raising a family.

We did the same in Sydney in 5 years with a young family.

In both instances, one partner was working only part time.

So it can be done.
 
those that say, "oh when I was your age, my first house, didn't have any running water and rats were running around" type of comments,

sure in 2013, you can pickup a dump dump of a house which is about to fall over in metro Melbourne, for say $150k, but surely you cant expect entitled or not first home buyers to live in places like that,

so where do you guys think draws the line to acceptable,

my 2c would be a 2nd hand slightly run down house in melton or west for $220k ish

or maybe run down lilydale and surrounds for about the $280k mark

I'd guess that these days when "every" house has an inside toilet and hot water (unlike the days when my parents were first home owners), that your suggestion of second hand, slightly run down house "anywhere" would be the worst that any first home buyer would be facing.

Times change, and so does our housing stock.
 
There ya go!!

What's wrong with those?

But; to compare apples with apples - almost all these whines seem to be from FHB's in Melb and Syd; maybe Bris.

Fairly true, the main FHB whinges I hear in Adelaide are from young people who have grown up in the inner suburbs, and want to buy in the same area as their parents but can't be bothered saving the deposit.

You could always send all the whingers over to SA, help increase our population!

"Adelaide: First world living at third world prices!"
 
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