This is a risky time for all aspects of Canberra. No one knows what the government is going to do. For all we know they could slash departmental budgets which would not be good for property and certainly not good for young people in living in Canberra.
Property market, safe as houses
- Thread starter BV
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This is a risky time for all aspects of Canberra. No one knows what the government is going to do. For all we know they could slash departmental budgets which would not be good for property and certainly not good for young people in living in Canberra.
Departmental budgets are being reduced, and have been for a couple of years. This is not news to anyone working in the industry. The word around the place is that the plan is to slightly increase the efficiency dividend, and allow attrition to reduce staff numbers. Also, there'll be some VRs for staff who are working on programs that are being wound up.
There are no plans for razor-gang style cuts at this point. As I posted previously, even when there were big cuts 15 years ago, the property market still didn't crash.
Which means that the El1s leaving won't be replaced by new blood so there will be less of them in market. To afford property on a single income you almost need to be an EL1 these days.
No, it means if EL1s leave there will be MORE of them 'on the market'. The question you should be asking is "why would an EL1 leave a secure, well paid job"? Answer - they have something better to go to. If they have something better to go to, they'll have no hassles keeping their home, or buying something of equivalent value.
The issue I think you are alluding to is to do with what the APS levels will do while they wait for new EL positions to be released.
Most people in the public service are paid well in excess of what their skills would be worth on the private market. There is an argument that "government" is a skill, which I'll accept under the broad umbrella of what is defined as a "skill" these days. In short, most of these people are useless outside of government and many would not be productive outside of their department or area of "speciality". They'll leave to retire or because they were fired.
That's a very big call. How long have you been working in government?
Government debt is 22.4% of GDP. and ill tell you something scary..our housing stock is worth 4 trillion dollars yet GDP(Nominal) is 1.2 trillion. housing stock should not be more than 1.5 times GDP.
Speculation has done a lot of damage to the economy and the saddest thing is Aussies join the Chinese and speculate on Australian property.no one gives a toss about the country as long as they can make a buck. we will sell all our land all our houses all our farms to overseas investors from china and middle east JUST TO MAKE A QUICK BUCK. and one day you know who will call the shots..NOT AUSSIES.
Australia has the highest household debt to disposable income ratio which is around 165%
Now you say we save? no we are actually reducing our debt.savings is when you have a surplus.
Personally i don't hold debt but savings.i also wouldn't buy a house because its much cheaper to rent and the value of houses is going to go back to where they were a few years ago.i could buy if i wanted to but i refuse to as i think the house prices are just ridiculously high(well we are in a bubble) and their quality is awful.All the new townhouses are poorly made and few have a good energy rating.
i get a healthy 6% on my savings.my advice to anybody now is to get out of debt and buy gold or silver.
Surely paying down debt is exactly the deleveraging you mentioned in an earlier post? It's happening in a fairly orderly manner, I would say.
If you don't want to buy a property because you think it's expensive, so what? Do you think a forum of property investors is worried about that? There ARE reasonably priced properties around, but you'll need to hunt them down.
As for gold and silver, I think I'll pass, as they are zero yield and I would prefer an investment that actually provides cashflow.
If you want to come on here with the standard bleats about speculation ruining the economy that's fine, but be aware that:
a) we've heard it all before; and
b) many of us, including me, don't share your views.
collectively we should rejoice in selling something above (what you claim) is its true value to a foreigner.
Whoa Whoa, now why are you getting so defensive? property here is expensive you me and the whole world knows it.we have the highest house prices to income ratio in the whole friggin world.so lets not argue about the property values.even the Chinese have stopped buying from Sydney developer Harry Triguboff.wonder why they don't buy no more? may be because our property is too cheap lol
Now when did i say you or anybody in this forum is worried? should you be worried? i think YES. but then again it depends on how smart you manage your investments. You know Americans speculated on property and see where they are now.now please don't say that was a sub prime crisis and we are different because we are not a lot diffrent.when interest rates go up everybody feels the pinch.
So a house that loses value by the day is what you call an asset that provides you cash flow? you know very little about gold and silver i guess.
I suggest you do your own research.
Defensive? Really?
Firstly, our property is NOT the most expensive in the whole world, there are many countries more expensive than us. Go look at Hong Kong prices, for example. As for us being no different to US, what percentage of our market was sub-prime? 3% What percentage of the US market was sub-prime? 16%. Hmmm.
My comment about being worried was in the context of people like me not being worried what you think!
"government workers" and "paid well" are two phrases that do not belong in the sentence if said sentence is sans the term "are not".
example 1 - a govt stat planner is on $55-64k pa with 12% super and fortnightly RDO.
the same planner privately is $74-85k + 9% super and standard monthly RDO.
example 2 - a govt building and services engineer is about $65-70k with 12% super and f/n RDO. a private engineer is a minimum $80k with 9% super and monthly RDO.
the only 'perks' you get with govt is the use of their gyms, parking, health etc - but a lot of larger private firms supply this anyway.
sorry, govt workers are not paid well. it is only their moral belief in public service holding them there, those employed without a socialist attitude do not last long.
example 1 - a govt stat planner is on $55-64k pa with 12% super and fortnightly RDO.
the same planner privately is $74-85k + 9% super and standard monthly RDO.
example 2 - a govt building and services engineer is about $65-70k with 12% super and f/n RDO. a private engineer is a minimum $80k with 9% super and monthly RDO.
the only 'perks' you get with govt is the use of their gyms, parking, health etc - but a lot of larger private firms supply this anyway.
sorry, govt workers are not paid well. it is only their moral belief in public service holding them there, those employed without a socialist attitude do not last long.
Agree but plenty of contractors fill the books as generally the ft duds haven't a big output.
Example 3, me 5 years ago in the PS, $100ph for a short term (2 years) IT contract.
Yep....not to mention the Big 4 banks with their spending sprees in Sydney and Melbourne.
It is just going nuts at the moment...plenty of work but no talent at the moment.
It is just going nuts at the moment...plenty of work but no talent at the moment.
I'm currently working a couple of contracts at over $115ph, with no end in sight.
"contractor" is NOT a "govt worker" - it's a "worker" on a "govt contract".
see the difference? either way, you've proven my point.
Well when you say many more countries can you name any other country than Hong Kong? main reason for high house prices in Hong Kong is that mainland Chinese are much more involved in property there now and there is actually a shortage. Well Australia is a friggin big country and there is no shortage here and,now you'll say yes and i will ask where those excess housing stock for sale now are coming from? in fact i think we have built too many in Victoria.
Now lets talk about Hong Kong yeah? Hong Kong prices are driven by wealthy mainland Chinese.Everybody in Hong Kong is now worried that a small trickle of cash out of the market for luxury housing, driven by wealthy mainland Chinese, could accelerate and send prices tumbling.
You should see the reality.you might be wondering why the world is experiencing a credit crunch? ill tell you. it is because we are all busy bailing out the Americans and you know it aint gonna get better its actually gonna get worse when America experiences Hyperinflation.
In Australia January arrears on the home loans that back prime residential mortgage-backed securities (RMBS) have climbed to their highest level since April 2009 Now isn't this evidence that a large number of Aussies are battling financial stress? Now i do not need to talk about the sub prime market in Australia yeah? and its not 3% either. a lot of young people who were financially unstable bought in 2008-2009 when the FHOG was tripled and most of them are sub prime loans.
Sub prime mortgages are not the only reason a housing market collapses, im sure you know about Spain and Ireland.A collapse occurs after a housing bubble caused by long time speculation,cheap credit and low interest rates.
You have nothing much to worry about, only the falling property prices.
Some say we always follow the yanks!
Singapore is also pretty pricey. There was a link on here some time ago, no doubt Mr Google would provide an aswer. Australia wasn't at the top.
Um, ok. Thanks for that. Not sure how it's relevant to Australian property, though.
Yep, we're definitely deleveraging, no argument there. I'm watching with interest to see what happens to the yanks. I think they're in a lot of trouble, but I suspect they'll find a way through.
Disagree this. To suggest that 'most' young people bought with sub-prime loans is very misleading, I think. Are you familiar with the form that sub-prime loans take in Australia? They aren't generally consumed by FHB, but by self employed people.
And what common characteristics does the Australian economy share with the PIIGS? There's a few things, but also a hell of a lot of differences.
I still maintain we'll see stagnation arther than big falls. Some parts of the market are susceptible to big falls, but most of it isn't.
Some do say we always follow the yanks, but I don't believe that to be the case. As I said before, we have some stuff to work through, and we're not booming, but we have quite a few good things on our side.
Speculators only make up a small percentage of the market. There are still investors, and still people wanting to buy a house to live in. Sure, it becomes a buyers market, but there are still buyers.
Don't think of me failing to understand, rather disagreeing.
They're in for tough times for sure. But never say never...
Now this I don't agree with. The reality is that Australia has nothing like the sub-prime market that the US did/does. We don't have ARMS, non-recourse loans or NINJA loans. FBH typically get cranky because they have to save a bit first!
We do have some debt. The difference is that ours is comparatively WAY smaller.
Melbourne soared to high highs and now has to come down a bit. Other parts of the market don't. Check out Sydney and Canberra, for example.
We might follow a trend, but the magnitude is nothing like the same.
Contrary to some opinions, the sky isn't actually falling.
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