Poor first home buyers Sydney

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.

Yes although the average and cumulative value of jobs in the cab will far surpass any non cbd suburb.
Adelaide's result doesn't surprise me. Unemployment in South Australia is at a 14 year high of 7.6%:eek:

I think it has more to do with low rates meaning the average mum and dad can afford to buy/build providing they are outside of Sydney, leading to more construction and supply.
I have now had 2 tenants wanting to buy their rental from me in the past month, I can't remember this happening before.
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.


* 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)
One of the reasons given for this current lack of affordability and boom is "lack of supply" - supply and demand issue yet again.

Yet, despite all this, rents are slow-to-not-moving.


Simple reason; the economy is not travelling that well - despite all the media hype of late - folks are not hiring (recent years of very high unemployment rates), and/or in this climate wage increases are not likely to get approved unless by the most profitable of companies....rather; we are seeing mostly job losses, closures and larger companies moving operations O/S wherever possible..

There is talk of a new giant grocery chain - Lidl - moving into Aust soon. Yet another company of mostly lower paid workers, and no doubt many on restricted part-time and/or casual hours to keep down labour costs so as to compete with the Woolies and Coles of the nation.

It'll be interesting then; we all might enjoy even cheaper groceries etc, but I can see a lot of belt-tightening happening as a result of the i veritable price wars, with lots of these new jobs being culled by the Woollies etc to keep their market share against the newbie and keep the costs down as the profit margins get skinnier.

The other reason for slow moving rents will be that due to the lower interest rates and resulting boom, there is more investor property available now, as well as less renters who have recently bought and no longer need to rent...less renters, more supply.

"But Hockey was once in opposition himself, and back then he threw similar barbs. "(Treasurer Wayne) Swan must explain why housing is more (affordable) when Melb prices rose 20% last yr", he tweeted in 2010. "The biggest challenge is housing affordability over the next few years", he reiterated a few months later, on the eve of an election. He was right, of course. Even if he now disagrees with himself."

Almost as good as this:


"The measure Mr Hockey was protesting against was the introduction of a $250 "administration" fee, which he feared would threaten the universal free higher education that he and his contemporaries enjoyed."

He should be in the Olympics for that flip flop.

What about this line though;

"The bare fact is that housing is unaffordable because the market is flooded with investors."


I think that at the moment the numbers are up around the mid 40% range of all loan applications? And they are all buying in Sydney, too. :rolleyes:

It (Sydney) was unaffordable back in 2004 too...look at how many properties didn't sell around those years. But now all of a sudden it is worse?

If they were so affordable then and not now; why were they not selling? No investors to steal the properties from the kids back then.

But now; the market is "flooded" with investors which is the reason housing is unaffordable?

The guy is a twit.

"An unhealthily high ratio of investor-owned properties is already occurring with ABS data confirming that 60% of NSW home loan approvals (refer Sydney) were for investors [30% is ?normal?]".
I didn't realise it was that high.

Of course; when stats are involved; I always add a sprinkle of salt.

And; there are still 40% of loans being approved to PPoR purchasers based on your stat.

These must be the folks who are only offering below market price and not being able to win the bid, while all the stupid investors are on a feeding frenzy of high bidding and silly offers which will end in their tears when the tide goes out (soon).

How many of those approvals were refinances/restructures etc? There are a number of variations involved.

Not all of them will be straight out "new purchases" by investors who have supposedly shut the FHB's out of the market...but that is how that stat you quoted will be interpreted by almost everyone - and especially the SMH who is anti-Lib, and pro anything that is anti-rich (which is usually attributed to the greedy capitalist Libs).

But let's put things in perspective on this boom -

Ten years ago in Sydney, noone could give a house away....

There were bugger-all investors out and about "pushing up the prices"...there was no competition for the FHB's to buy anything.

There was no whining by anyone about how NG was killing the property industry...the market was f.l.a.t....nothing was happening.

The investor activity % was probably at it's normal level of approx 30% - or even waay lower I'd wager.

Where was all the media and FHB screaming then?

But right now; it's all the investors' fault.

unfamiliar with the Sydney market but surely its not all premium properties. perhaps around the city/bay/beaches but out west are areas of social disadvantage and probably other areas too.

affordability is assisted by cheap interest rates at present. cannot remember such low rates in decades. what will happen when rates return to normal rates?
right now it looks a long way off but rates will rise. many will be overcommitted???
I have been telling you for months, you are just too blinkered to take it in. Anything that doesn't already conform to your view is automatically shut out.
It's academic....40, 50%.

I haven't been paying attention to the numbers because I and others know that they are not the only cause of any sort of price rises.

The numbers are higher right now for sure, but as I said; talk to me about 2004,5,6 Sydney - or any of the other flat periods in the past when noone was blaming investors for anything, and noone was screaming for NG to be removed.

It only pops up during a boom when the PPoR buyers want to buy.

Same, same...any you still haven't bought...when the prices drop?

Don't worry; the hoohah will be over soon enough, the investors will have left the building, and the playing field will be wide open for everyone else (you).
Going from 30% to 60% is hardly just academic, it's a significant change
Yes, it is a change, but the number is academic.

You can say 40 or 60 or 50.

At the end of the day, the climate is right for everyone to buy - and everyone is.

The point I make is that the FHB's and anti-NG disciples blame the whole lot on investors. It could be the usual 30%, but in this climate the blame is still placed squarely on investors shoulders.

And the words used by everyone on the losing side of the equation are Neg Gearing.

It still remains to be proven that investors are out there stealing houses away from everyone else because they have the NG arrow in their quiver.

Maybe I'm the odd one out, but NG has never been at the top of my list whenever I've bought an IP.

All that has been shown is that there are more investors out there, as there are more PPoR buyers out there.

How many investors do you reckon right now are out around Sydney today, over-bidding at auctions and shutting out a FHB, knowing that the rental yield will be totally crap, the market is nearing the top, and they may be paying too much into the bargain?

I reckon the percentage of investors who are stupid enough to do that would be less than 5%...and they would need to be cashed up as well, so let's call it 1%.

Stupid, cashed-up investors...lots of them around, I'm sure. :rolleyes:

Most Mum and Dad investors are using equity for the deposits, and a loan for the rest - rental yields will be horrible for the majority of these folks.

The rest are looking to spend less, get a rental yield, pay the right price, and so on.

Or, do you seriously believe (like Hobo does) that all investors are stupid and will throw money at anything just because it has been cheap to borrow and relatively easy to get?
Ti answer your last paragraph, I do think there are lots of investors out there with more dollars than sense, some of the prices fetched recently are outstandingly stupid. Lots but not all obviously. Remember that run down 2.8m wide Surry hill terrace on 38sqm selling for $1m to an investor a few weeks ago?

If you genuinely feel that investor activity, in a market where it comprises 60% of all purchases, doesn't have any effect on price then km happy to agree to disagree.

Whether that is a good thing or a bad thing is a separate discussion, I just find it pretty funny that people can deny obvious facts.

Incidentally you keep picking on hobo for not buying any IPs, haven't you not bought any for a decade? Everyone has their own circumstances, including both you and him, don't see why that should be constantly brought up to refute everything he says. Now, before you get hypersensitive again, this is not a dig at you.

He makes some good points and some I disagree with
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