Actually some of those suburbs are quite ok, putney, twickenham, greenwich, muswell hill. Its surprising but there's actually not a huge difference in prices between London and Sydney at the current exchange rate (excluding the prime central and SW London stuff). I've owned 1 bed flats in both cities (sold the London one 18 months ago), worth about the same, but the London flat (docklands) was nicer I'd say than the Sydney flat (coogee). Which makes me think Australia is still a bit overpriced.
Where's the crash
- Thread starter pieman
- Start date
This is a short term mindset Dean.
The Gubbermint is giving you free money currently. In the long term it won't matter if the properties drop 5% (and I don't believe they will as there are always more FHB's coming behind you - unless we suddenly have no immigration and/or childbirth), but this grant is money you will never have recieved otherwise.
Why not do both? buy a property and keep on saving (reducing debt).
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The housing shortage was discussed in detail in this thread (warning: contains "data for the actual gap").
On the contrary, the RBA has actually provided some of the more sensible commentary on Australia's housing shortage.
RBA Address to the 4th Annual Housing Congress
We just had a new tenant move in to one of our properties over in W.A, Audas.
The rent went up from $285 to $300 p/w. (yay!)
The agent informed us before this that the rental market was still going along quite well, but the rises had slowed.
Not falling.
Here's how I see it:
With Bank lending becoming more difficult (despite the lower rates) there will be less people wandering around who will qualify for finance now, so this will keep more would-be buyers trapped in their rentals until they can improve their financial position enough to get finance.
Given that a high number of Aussies are consumers and not savers, this is not going to produce a wave of qualified buyers in the near future, unless rates drop further and improve their DSR at least.
More investors will come back in to the market probably, which may dilute the rental pool somewhat, but given that most investors have a cap gain metality, and the horizon for this looks grim in the shorter term, I'd say many will stay away for a while longer.
Bottom line; rents will possibly soften a bit - but I don't think so.
Not necessarily commenting on the area, just the quality of the property.
The argument from some has long been Aus. property quality is garbage compared to overseas, but I have to say I would rather spend my $400k here after looking at what $400k gets me in London.
As for prices, if I compare a 1 bedroom or studio in London CBD compared to Sydney CBD..................................
London
Sydney
Dave
Looks at rental statement last half compared to now............
Nup, you are wrong audas, they have gone up, some considerably, some even in the last month and on long leases as well thanks.
Dave
Hi Guys,
Just so I don't appear all unbalanced and bullishly blind, here's a link to an article outlining the case for downward pressure on rents:
Renters seek financial safety in numbers
The Australian said:
The gist of the article is that renters are "bunching up" due to fear or financial pressure. Won't affect all tennants but is definately a decision made by some. Question is, how much is it offset by natural population growth, and what proportion of renters are willing to bunch up and forego lifestyle for austerity. They've been bunching up for a while now. This is just an extension of the current trend until affordability supported by a strong economy supports them spreading out again.
But there ya go. Gospel! Rents are falling!!
Cheers,
Michael
I think you are right Michael (and I'm considered a property bull by some on this forum too).
Last time I looked ( a few weeks ago) 42,000 FHOGs had been given out. Now some of those 42,000 would have been living at home with parents, some would have been living in share accommodation (sharing rent) and some renting on their own. This last group must have an effect on freeing up rental vacancy from what has been very very tight.
The flip side to this is the investors who sold stock while the FHOG/B was/is in place and the high levels of immigration that we have.
So I'm not surprised that rental vacancy rates have and will rise a bit. But let's face it 5% vacancy is 2.6 weeks per year. I remember not all that many years ago, that you had to wait 4 - 6 weeks sometimes and offer 1 - 2 weeks free rent to attract a tenant. Giving a $10 week reduction in rent to get a tenant is only $520 per year or 1 - 2 week's rent at best. Yes, of course, sorry I forgot, the sky is falling
Last time I looked ( a few weeks ago) 42,000 FHOGs had been given out. Now some of those 42,000 would have been living at home with parents, some would have been living in share accommodation (sharing rent) and some renting on their own. This last group must have an effect on freeing up rental vacancy from what has been very very tight.
The flip side to this is the investors who sold stock while the FHOG/B was/is in place and the high levels of immigration that we have.
So I'm not surprised that rental vacancy rates have and will rise a bit. But let's face it 5% vacancy is 2.6 weeks per year. I remember not all that many years ago, that you had to wait 4 - 6 weeks sometimes and offer 1 - 2 weeks free rent to attract a tenant. Giving a $10 week reduction in rent to get a tenant is only $520 per year or 1 - 2 week's rent at best. Yes, of course, sorry I forgot, the sky is falling
Can you provide a link to these posts? I'm not seeing reductions, still getting regular increases.
Count us in on that. Rents went up 5% on 2 new leases 6 months ago (from memory) and I've just increased both by 5% again.
But then again, we're talking about real world situations guys - not lovely theories, and articles from websites. Maybe it doesn't count?
Hi Audas, nice to see you back again.
Residential rents were up 1.7% in the March quarter, and 8% over the past 12 months, according to the ABS.
http://www.abs.gov.au/ausstats/meis...CA25759F001A277A&0&Mar 2009&22.04.2009&Latest
(I hope you don't put me on ignore for mentioning this).
Cheers,
Shadow.
nice explanation there joe. cheers.
i agree Australia is a "bit" overpriced. not 40% worth, but still maybe 2-3% comparitively.
the first result in that link is a 2bed FLAT in SE19 - or Crystal Palace - for GBP200k.
have you BEEN to Crystal Palace? Have you SEEN how run down that area is? We stayed there for a month in transit between London and Paris thinking it was a nice cheap area with good facilities - well, the facilities are there, but they're not good. and it's cheap for a reason.
that's a flat - no yard. in a shocking area. for what amounts to about $420k.
Beachside Suburb Search less than 20k from Brisbane with Public Transport for under AUD350k
incomparable? methinks not.
well, I have just read this whole thread, and it was an interesting nights reading.
I am not an expert on property investing, just learning there, but I am an expert on matters political, and there is a very strong 'political' bent to your posts audas.
I have heard almost identical arguments presented by just about every card carrying socialist I know, who are by and large salivating at the prospect of the demise and collapse of capitalism.
Many of your arguments referenced responses from "the government" to the crisis, surely you would be savvy enough to know that governments have one eye on the economy and the other on the electoral cycle.
Specifically, pre budget discussions always include doom and gloom predicitions in order to soften up the electorate for less than popular spending decisions.
More interestingly, many of the so called 'cuts' that are mooted in so called 'response' to the GFC were on the rap sheet of the Labor party at the last election.
Things like negative gearing, which you spoke of have been in the ideological radar of the left for a long time.
They will use the GFC to reposition government spending to be more in order with the ideology of the Australian Labor Party.
So, by all means, reference economists, financial experts and business comentators, but I pay no heed to responses from politically driven governments.
I am not an expert on property investing, just learning there, but I am an expert on matters political, and there is a very strong 'political' bent to your posts audas.
I have heard almost identical arguments presented by just about every card carrying socialist I know, who are by and large salivating at the prospect of the demise and collapse of capitalism.
Many of your arguments referenced responses from "the government" to the crisis, surely you would be savvy enough to know that governments have one eye on the economy and the other on the electoral cycle.
Specifically, pre budget discussions always include doom and gloom predicitions in order to soften up the electorate for less than popular spending decisions.
More interestingly, many of the so called 'cuts' that are mooted in so called 'response' to the GFC were on the rap sheet of the Labor party at the last election.
Things like negative gearing, which you spoke of have been in the ideological radar of the left for a long time.
They will use the GFC to reposition government spending to be more in order with the ideology of the Australian Labor Party.
So, by all means, reference economists, financial experts and business comentators, but I pay no heed to responses from politically driven governments.
