Poor first home buyers Sydney

[Gockie]

You are forgetting that those of us with equity still had to save and scrimp to get our "first" property. It was not easy for us either.

Yup, I did that, I saved since working through high school. I finally bought at the end of a boom in mid 2005 Sydney and the value of my first property went nowhere for 3 years and interest rates weren't so low. My sister had bought a few years earlier and had seen the value of her place just about double in a few short years. I was not in a position to buy when she first bought though. Anyway, I did finally get into the market, I'd be making my repayments and month after month, it seemed that the principal was not going down at all (�� I bought as PPOR)... we decided to move to a bigger place, kept the first place as an IP, suddenly a boom hit, I had equity, then wow. Deposits for after the 2nd IP comes much easier. Equity is very good now. Now it just comes down to lender serviceability calculators for me.

 

[BayView]

You are not much of a capitalist if you think growth at the rate of inflation is a good return for holding property.

It also depends on other factors;

If you have used no actual cash of your own to purchase,
If you have 2.5% depreciation
If you have a rent return at or greeter than your loan amount
If (using the above) your cashflow is pos after tax,
If you can add value through a Reno and the Reno values the house at more than the reno costs

The combo of all those factors provides a nice combination which accelerates the IRR over and above merely just the CG rate.

 

[natedog]

Just go get a good job.....problem solved....

 

[Biz]

Just go get a good job.....problem solved....

Was just watching the 7:30 report regarding this. They were taking comments from young people crying they will never be able to afford a home....walking around the Pitt street mall with shopping bags in their arms on a Tuesday....

 

[JDP1]

Just go get a good job.....problem solved....

that's what hockey was saying....well..what does anyone expect him to say? get a bad job?

 

[JDP1]

Was just watching the 7:30 report regarding this. They were taking comments from young people crying they will never be able to afford a home....walking around the Pitt street mall with shopping bags in their arms on a Tuesday....

yeah.
Maybe they were just carrying the sandwiches they made at home for lunch in those bags

 

[2FAST4U]

that's what hockey was saying....well..what does anyone expect him to say? get a bad job?

 

[Gockie]

http://www.theshovel.com.au/2015/06/09/joe-hockeys-6-tips-for-first-home-buyers/

 

[2FAST4U]

http://www.theshovel.com.au/2015/06/09/joe-hockeys-6-tips-for-first-home-buyers/

Tip 7- Marry an investment banker

 

[lizzie]

My parents who on 30k a year bought a place in Wakeley for 100k and paid it off within 8 years in the 90s and 2000s. Wasn't an undesirable location and wasn't the edge of Sydney either.

That's one of the points tho - $30,000 in the 80's was a darn good wage.

Take my example from 1986 ... earning $100/wk ($5,000/yr) - now pays around $1,000/wk ($50,000).

So, to be earning $30,000 in the 80's (depending on what end) could equate to $2-300,000 nowadays.

But also to show that you can't compare apples and oranges ... and that current "inner" properties weren't always "inner" ... here's a photo of a typical 1960's Merewether (Newcastle) house - very possibly would've had a dirt - or narrow cement track outside as the road ... compared to a 2015 house for sale on realesate.com

http://www.realestate.com.au/property-house-nsw-merewether-119083863

 

[jerrybee]

But also to show that you can't compare apples and oranges ... and that current "inner" properties weren't always "inner"

Also "inner" didn't used to command the same premium when the population wasn't as dense. It was just as comfortable to live 20-30 mins from the CBD as the commute to work wasn't as painful as it is now.

 

[aussieB]

So not true. Everyone I know in their 30's who doesn't own a home by now I can show you exactly why they don't. They spent most of their 20's blowing cash on night clubs, overseas trips, expensive cars, drugs, big birthday parties, hotels in the city etc. I did all that too BUT I put some money aside and now im fine.

You want to buy your first home? Here I'll show you how to do it on an average wage in 2 years:

Work Monday - Friday at you're normal job - SAVE - $300
Work Saturday/Sunday somewhere - SAVE - $200

You should still have another $1000 for all your other life costs. They should be able to save around 50k in 2 years, buy a BRAND NEW unit somewhere decent and they can start on the track to doing something with their life.


If an ordinary every day bumpkin can't do that they have no hope. It's a little bit of sacrifice to get ahead and out into their own place off mummys tit.

We don't have an affordability crisis, we have an expectations and discipline crisis.

#$%^&* SAVVVVEEEEEE!!!!!

Exactly ! I keep looking at all these people who can live with their families/parents and then live within their means and save so much to fuel their investment. But alas. Many people don't have that luxury. I remember Ace posted a youtube video - hussle like an immigrant. That is so true ! There are so many immigrants here who are slogging their back sides off - feeding and running their houses in Australia, funding their parents' in a third world country, assisting their siblings else where AND saving up for investment properties. Never seen an immigrant on the dole tv shows either.

 

[lamp]

Think it was reported from the News or A Current Affair last night saying that young people from the age of 24 to thirty something are struggling to get into the property market. I was 30 when I bought my first home in year 2004 after working for 4 years with a professional job and hard saving. I picked the suburb that most people were looked down on at the time, the unit was a 2 bedroom worn down unit which did not look revealing at all.

I live within my mean, never buy designer clothes or hardly buy new clothes, hardly any overseas trips, cook at home, bring my own lunch, nothing fancy but instant noodles or sometimes plain bread...although working in a professional job, I've never stopped investing in upgrading myself through continous study. My parents time was even harder. Getting really sick of the so called young generation not being able to buy, I think it is more of them being unrealistic, they want it nice, close to the city without sacrificing their life style....nothing can be compromised, otherwise, it is not fair for them!!!

 

[windyzz]

Think it was reported from the News or A Current Affair last night saying that young people from the age of 24 to thirty something are struggling to get into the property market. I was 30 when I bought my first home in year 2004 after working for 4 years with a professional job and hard saving. I picked the suburb that most people were looked down on at the time, the unit was a 2 bedroom worn down unit which did not look revealing at all.

I live within my mean, never buy designer clothes or hardly buy new clothes, hardly any overseas trips, cook at home, bring my own lunch, nothing fancy but instant noodles or sometimes plain bread...although working in a professional job, I've never stopped investing in upgrading myself through continous study. My parents time was even harder. Getting really sick of the so called young generation not being able to buy, I think it is more of them being unrealistic, they want it nice, close to the city without sacrificing their life style....nothing can be compromised, otherwise, it is not fair for them!!!

I Agree.... I'm 29 and hardly bought anything for myself. All my work clothes has been 4 years. I used to go everywhere with my PJ ....
Hardly been overseas, bring lunch to work and cook at home for dinner Monday-Friday. No other expenses, Laptop and Phone is provided by the company.... Live @ home with parent and spend 95% of my income in investment property........ hahahah SAD Life!

People just need to have a priority and goal... and work through it. Many young people these days are on spending spree, and have massive debt on Credit card....

 

[skater]

Think it was reported from the News or A Current Affair last night saying that young people from the age of 24 to thirty something are struggling to get into the property market. I was 30 when I bought my first home in year 2004 after working for 4 years with a professional job and hard saving. I picked the suburb that most people were looked down on at the time, the unit was a 2 bedroom worn down unit which did not look revealing at all.

I live within my mean, never buy designer clothes or hardly buy new clothes, hardly any overseas trips, cook at home, bring my own lunch, nothing fancy but instant noodles or sometimes plain bread...although working in a professional job, I've never stopped investing in upgrading myself through continous study. My parents time was even harder. Getting really sick of the so called young generation not being able to buy, I think it is more of them being unrealistic, they want it nice, close to the city without sacrificing their life style....nothing can be compromised, otherwise, it is not fair for them!!!

And you will do well for yourself because you understand that in life everything is not handed to you on a silver platter. You have to work, and strive for what you want, and even then, you have to be realistic.

I know a single mother. To be fair, this person is not a bludger and she's been working ever since she went to Uni, but not as the teacher that she qualified for, but in a casual role in a field that she enjoys, with a very low pay. The hours are often in excess of 40hrs per week, but it's still casual.

She lives at home and shares a room with her child. Her mother has the second bedroom. It is a 2 bedroom unit in an area where prices are quite high.

This person is always complaining about the price of real estate, and the fact that she will never own a home. Before prices went crazy in Sydney, I showed her how affordable it would be to live in Western Sydney, but she could never live 'there', and won't even move (rent) a unit near to home, as it's too expensive.

These are the people that are carrying on about how things are unaffordable, but they aren't willing to help themselves. With a bit of sacrifice, most things are achievable. The thing is that instead of thinking "I can't afford it", you need to change your thinking to "How can I afford it?", and then, like Ace says, hustle like an immigrant.

 

[BayView]

But also to show that you can't compare apples and oranges ... and that current "inner" properties weren't always "inner" ... here's a photo of a typical 1960's Merewether (Newcastle) house - very possibly would've had a dirt - or narrow cement track outside as the road ... compared to a 2015 house for sale on realesate.com

I distinctly remember getting off the tram with my Mother and Sister, at the end of the line on the Burwood H'way (corner of Burwood H'Way and Blackburn rd - from memory), when I was approx 4 years old.

We were going to visit her sister (my Auntie), who had moved out there to live in one of the new estates popping up around that time.

We had to walk down a dirt road, with my younger sister in a stroller, and I remember my mother struggling with this stroller across the loose stones on the unmade road to her house.

So, this is Burwood; which is now a high demand, middle ring suburb.

Back then it wads the end of civilsation, and Ferntree Gully was a day trip.

 

[ej89]

And you will do well for yourself because you understand that in life everything is not handed to you on a silver platter. You have to work, and strive for what you want, and even then, you have to be realistic.

I know a single mother. To be fair, this person is not a bludger and she's been working ever since she went to Uni, but not as the teacher that she qualified for, but in a casual role in a field that she enjoys, with a very low pay. The hours are often in excess of 40hrs per week, but it's still casual.

She lives at home and shares a room with her child. Her mother has the second bedroom. It is a 2 bedroom unit in an area where prices are quite high.

This person is always complaining about the price of real estate, and the fact that she will never own a home. Before prices went crazy in Sydney, I showed her how affordable it would be to live in Western Sydney, but she could never live 'there', and won't even move (rent) a unit near to home, as it's too expensive.

These are the people that are carrying on about how things are unaffordable, but they aren't willing to help themselves. With a bit of sacrifice, most things are achievable. The thing is that instead of thinking "I can't afford it", you need to change your thinking to "How can I afford it?", and then, like Ace says, hustle like an immigrant.

Haha that's nuts. You wont get that attitude from of us westies tbh.. It'll be the kids who grew up in nice suburbs closer to the city who would say something like that.. Most westies will live anywhere cause we've seen it all..i'd live in Whalan if my Mrs wasn't a social worker in the area.

 

[BayView]

The other thing about all this is the relevance of everything to the CBD.

I'm sure that loads of the population don't work in it, or need to go to it - other than some event.

Therefore; unless you need to be near the CBD, shift your eyes away from it and its locale for property selections that will be affordable.

 

[BayView]

Haha that's nuts. You wont get that attitude from of us westies tbh.. It'll be the kids who grew up in nice suburbs closer to the city who would say something like that.. Most westies will live anywhere cause we've seen it all..i'd live in Whalan if my Mrs wasn't a social worker in the area.

I don't think where you live is the major factor on kid's attitudes to this (or any) problem.

It comes back to their upbringing and values instilled by their parents.

I know you can't force kids to learn all the right stuff, but if you start on them at a younger age about responsibility, accountability, work ethic etc, you can hopefully get them to adulthood and they might have some resilience and the ability to be a "can do" type.

 

[unloadmymind]

Rents in Australian capital cities are rising at their slowest pace on record.

While Sydney and Hobart were the cities that posted the strongest rent rises in the year to May 31, steep falls in Darwin and Perth kept a lid on the national average.

The latest CoreLogic RP Data rental index shows that average capital city rents rose 1.5 per cent to $488 a week, the weakest rise on record.

"The sluggish pace of rental appreciation can likely be attributed to the ongoing boom in dwelling construction across Australia's capital cities accompanied by record high participation in the housing market from investors," the report said.

"Most of the new capital city housing stock is units and this type of stock is much more likely to be owned by investors providing additional rental options across the capital cities."

Sydney was the most expensive place to rent a home, with rents rising 3.1 per cent to $595 a week.

And while Hobart posted the strongest annual rise in rents, it remains the cheapest city for tenants at $342 a week.

The report also found that with city rents increasing at their slowest pace and home values falling, gross rental yields for landlords had decreased.

Yields for rental houses fell to 3.6 per cent in May from 3.9 per cent a year earlier, marking their lowest level since late 2010.

For units, yields fell to 4.6 per cent from 4.7 per cent.

RENTS

* Hobart, up 3.2 pct in the year to May 31 to $342/wk

* Sydney, up 3.1 pct to $595

* Melbourne, up 2.3 pct to $446

* Brisbane, up 2.0 pct to $435

* Adelaide, up 1.2 pct to $369

* Canberra, down 0.6 pct to $500

* Perth, down 4.5 pct to $477

* Darwin, down 5.5 pct to $567

* Combined capitals, up 1.5 per cent to $488

(Source: RP Data)