what makes property price in Australia (Sydney in particular) overpriced ?
- Thread starter albertwt
- Start date
I believe it is called "inflation".
It doesn't always increase in price. Just wait until the world heads into a double dip, and the government no longer has the money to prop it up with stimulus. Anyone who follows the world situation knows we are in for some tough times ahead.
I wouldn't be buying anything new until late 2013.
Must have been Zimbabwe style "inflation" then the past 10-15yrs as prices spiked.
Basic supply and demand, an expectation of increased wealth, and believe it or not affordability (someone's buying even if you or I can't).
Some of these factors are real, others are based on perception but as long as they all remain in place then the prices will continue to increase.
Like the share market, property prices rise and fall but historically they increase over the long term. This may not be the case in a small town dependent on one or two employers or industries, but is the norm in the major cities.
Some of these factors are real, others are based on perception but as long as they all remain in place then the prices will continue to increase.
Like the share market, property prices rise and fall but historically they increase over the long term. This may not be the case in a small town dependent on one or two employers or industries, but is the norm in the major cities.
Don't listen to bluestorm, he's one of Steve Keens students.
Do the opposite of what they say and you're likely to make money
I think it depends on what you buy and where you buy in Sydney.
People forget that we recently had 7 years of price corrections and price stagnation.
We've had some growth in 2009/10 which basically brought us back to 2004 prices.
Since 2004 people's wages have gone up on average 4% a year and rents have gone up a lot too. So our holding costs are much lower now.
Are these prices super high and unaffordable?
Not really, it depends on who's buying.
However, big size loans means people are interest rate sensitive.
So watch interest rates.
Are they likely to go up by much?
I doubt it, therefore prices are likely to stay around their current levels and will increase or decrease slightly as market sentiment changes.
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I believe it is supply and demand also. When you live in the best city in the best country of course you will pay a premium as everyone wants to own a piece of that.
What's your definition of overpriced?
Is it the entire city and metro areas that you believe are overpriced?
Is it the entire city and metro areas that you believe are overpriced?
Not to be pedantic, but inflation in Zimbabwe is more than two million percent.
Ummm . . . God's not making any more land?
Demand.
Everyone wants to immigrate to Sydney first up. And do.
It's also perhaps the largest city for business in Aus? many companies/people need to be there for this reason.
All the tourists lob there first, love it and think of settling there if they do move here in the future. It's a beautiful place.
When we lived in the US, I got sick of hearing the Yanks telling us about their visit to Aus when they found out we were Aussies (they intially thought we were Poms
)...our conversation went like this; Yank - "Oh yeah; loved Australia"
Me - "What areas did you visit?" (knowing what the answer about to come was going to be
)Yank - "Sydney and Brizzbayne, and went to the Barrier reef"
Go and see how cheap houses are in say; Donald, Vic as a comparison....
I'm sick of hearing this said all the time here.
This is not the normal house buyers' mindset.
It is the mindset of those few who are on forums such as this....Investors.
Yer average penguin is not an investor, yer average penguin is purely looking for a nice house in a nice area, and if they can't afford that, they look to the next less expensive location and settle for that until they can trade up to the postcode suburb when the income permits...
Think about how many people you actually know, and think about what % of them are property investors - people who buy property for the sole purpose of making money from it through renting out/subdiv/flip etc, (not yer person who buys the weekender on the coast or in the Country for the family and plans to retire to it in 30 years either)
God is not but we are. Everytime we build upwards we are creating more land.
Skyscrapers will be built for food production one day. Only a matter of time before the economics make it worthwhile.
Q. Is there an affordability crisis?
A. Yes, for those who can't afford it.
A. Yes, for those who can't afford it.
I'm not sure that floor plates in skyscrapers actually are land, even if you do put a bit of soil on top of the building and call it a garden.
As for the economics making it 'worthwhile', isn't this a direct consequence of the absence of additional god-given land to accomodate a growing population?
Are you meaning to imply that buildng skyscapers will reduce the pressures that make housing prices increase? If so, how does that work? Don't skyscrapers cost rather a lot of money to build?
Or are you talking about something else entirely that I haven't managed to pick up on?
They are not over priced. I moved from Perth to Sydney 4 years ago to buy a property because it was better value for money at the time.
That only proves that Perth was more overpriced than Sydney. Not that Sydney is not overpriced at all
