I used to be a die hard believer in the Sydney housing bubble theory. I am no longer.; A correction in Sydney house prices is unlikely. A correction in our living standards is certain.
Herb, if you think it is as simple as that then you are making it quite clear that you have no idea about the complexity of the situation and shouldn't be commenting.
Why wouldn't you want a nice old man like me commenting Chris?
I'll pretty much always tell you what I believe is true, to the best of my ability anyway, even though it very well might not be what you'd like to hear.
Which has to be a heck of a step up on those who'll plain lie to your face and/or tell you what you do want to hear for their own nefarious reasons.
Shute mate, SEQ house prices DID go up in the last recession - Dunno if Sydney ones did? Or Melbourne. And I'm not interested. But you just could be interested in checking it out yourself.
Hmmm - Must admit to being a bit generally curious on how Canadian prices might make out now they've entered recession. But not interested enough myself to actually do my homework and find out. What with my major investment decisions/financial plans for the future pretty much being made now.
EQUIVALISED DISPOSABLE HOUSEHOLD INCOME - 90th Percentile is $1,688 per week which is about $130,000 gross per annum.
And Sydney will definitely have higher incomes than the country, but 53% higher is probably a stretch.
Right?
EDIT - you are quoting the DISPOSABLE income numbers - I was talking GROSS - ie before tax or any other expenses. Table 1.2 of the link you posted quotes the mean GROSS household income of the top quintile (top 20%) being $5k week = $250/year. And the figure for the top of the 90th percentile is $4k = $200k/year. So 10% of Aussie households do earn more than $200/year! You have established that as a fact. So if that's the national average of that group, I think I was in fact incorrect before - 10% - 20% of Sydney households are on over $200k, but actually given the high incomes of Sydney it may well be that MORE than 20% of households have a total income $200k+!
Hoisted on your own pertard!
That data is fascinating by the way! It shows the huge amount that household incomes have grown in Australia since the 90s in real terms! +60% on average - that's HUGE! No wonder a lot of money has gone into housing / lifestyle over that period of time compared to previous era's!
Recall knowing a then youngish couple the best part of a decade back now who shelled out a mill (in borrowed loot pretty much certainly) for a some joint somewhere in Sydney. Both of whom would have been on pretty good loot - A process engineer and an accountant or some such if I recall correct? And went How the hell do you compete with that? While given my own personal circumstances anyway, deciding that one didn't!
A Professional Demographer to an amateur demographer:"negative natural increase will never outweigh the positive net migration"
EDIT - you are quoting the DISPOSABLE income numbers - I was talking GROSS - ie before tax or any other expenses. Table 1.2 of the link you posted quotes the mean GROSS household income of the top quintile (top 20%) being $5k week = $250/year.
You are quoting the mean of the quintile not the 80th percentile.
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And the figure for the top of the 90th percentile is $4k = $200k/year. So 10% of Aussie households do earn more than $200/year! So if that's the national average of that group,
No, the 90th percentile is not an average. The mean of the quintile is an average.
Income per week at top of selected percentiles(b) 90th (p90) - 3,979 per week which is $206,908 per year
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I think I was in fact incorrect before - 10% - 20% of Sydney households are on over $200k,
Yes, you were incorrect about that. The mean of the quintile most certainly indicates that some in the quintile are below that and some are above that.
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but actually given the high incomes of Sydney it may well be that MORE than 20% of households have a total income $200k+!
I think not.
It may be as high as 12%
Population of Sydney: 4,293,000 12% of Sydney = 515,160
North Shore population: 215,000 Eastern Suburbs population: 250,000 Inner West population: 205,000
Recall knowing a then youngish couple the best part of a decade back now who shelled out a mill (in borrowed loot pretty much certainly) for a some joint somewhere in Sydney. Both of whom would have been on pretty good loot - A process engineer and an accountant or some such if I recall correct? And went How the hell do you compete with that? While given my own personal circumstances anyway, deciding that one didn't!
Yes - lots of stories like this from people in Sydney.
PS - seeing as I edited my post, I think you were responding to a comment I made about how it's not hard to have a $160k household in Sydney - only takes 2 average income earners working full-time to hook up! many have one above average as well getting closer to $200k.
For Aussie property bears, "denial", is not just a long river in North Africa.....
Sydney has *always* had high paying jobs, and lots of them, across many industries
Please point to where I said they didn't.
What I did say was that high property prices were more a function of high wages than population growth. A point you failed to refute.
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...that also have evolved over time. Sure right now there are lot of decent paying gigs in finance
Yes. 7 years after the previous generation of decently paid clever clogs brought the financial system to its knees by convincing everyone that debt issuance was genuine productivity growth. Amazing evolution that's been, eh?
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in the past these were a lower proportion of the high paying gigs though, yet everyone in Sydney still generally earned more than elsewhere in Oz - certainly if you were in a profession.
Evidence please.
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Also, not all high paying jobs in finance are the "bullshit" jobs in banking etc that you seem to view your current contract role as? Many finance jobs are historically, and will remain, very systemically important, to the operating of the economy - these jobs have historically been centred in Sydney and to a lesser extent Melbourne.
Does one Ian Narev unit of productivy equate to 120 units of other highly skilled financial professionals? Because that's what his salary implies. Will he bear any extra responsibility should the financial system implode here and cause ordinary people to suffer?
No is the answer to both questions if you're having trouble.
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In fact if anything the recent period of very high paying mining sector jobs out in whoop-whoop has been an exceptional/unusual time, in that good $$$ have been on offer outside of the big smoke for large numbers of people. If anything is changing this would to be it.
This is not the first time there's been money to be made outside the cities, please scrub up on some basic Australian history - you can start with the gold rush and the sheep's back. Many farmers have made tidy sums when demand and the weather worked in their favour.
The only thing exceptional about this time is that it's coincided with the formation an unprecedented debt fueled residential property bubble that's about to pop.
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Anyway I don't think all this is going to suddenly change, even if jobs such as yours do for some reason fade away or become displaced. Something else will rise in place.
Again the same tired old bull BBQ trump card truism works its way out - things go up, things go down but hey life goes on! Anything to divert people's attention away from present facts.
Still it's this sort of stupidity that pays my rent so I guess I should be grateful.
Veritas
15 Sep 2015, 05:53 PM
200k salary? How many Sydneysiders do you think are on that?
2% maybe.
You are the doofus.
$270k when you include my wife's. I don't give a monkey's what people say here that's solidly middle class.
But hey, if we reeealy stretch ourselves look what we can "own" for $1.6 million:
Or alternatively, we could rent it for about $750 bucks a week and just bank the rest.
Sydneyite
15 Sep 2015, 06:28 PM
Maybe - but I reckon somewhere between 10%-20% of Sydney households would have that level of household income? And that's more than enough to own/occupy every house on the north shore, eastern suburbs and the inner west.
"It were not best that we should all think alike; it is difference of opinion that makes horse races." - Mark Twain on why he avoids discussing house prices over at MacroBusiness. "Buy land, they're not making any more of it." - Georgist Land Tax proponent Mark Twain laughing in his grave at humourless idiots like skamy that continually use this quip to justify housing bubbles.
Why wouldn't you want a nice old man like me commenting Chris?
I dunno Herbie, perhaps because you're a rambling, rent-seeking POS with fusty old-fashioned values?
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I'll pretty much always tell you what I believe is true, to the best of my ability anyway, even though it very well might not be what you'd like to hear.
Just like I make it my duty to serve up few home truths about you Herbie when you start to stray - whaddya think mate?
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Which has to be a heck of a step up on those who'll plain lie to your face and/or tell you what you do want to hear for their own nefarious reasons.
I'm sure Chris is big enough and ugly enough to have worked this out without your worthy patronage.
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Shute mate, SEQ house prices DID go up in the last recession - Dunno if Sydney ones did? Or Melbourne. And I'm not interested. But you just could be interested in checking it out yourself. Hmmm - Must admit to being a bit generally curious on how Canadian prices might make out now they've entered recession. But not interested enough myself to actually do my homework and find out. What with my major investment decisions/financial plans for the future pretty much being made now
Ramble, ramble, ramble, swig, HIC!
A Lurker
15 Sep 2015, 11:04 PM
That's a 3 bedroom house and a 2 bedroom house on 800sqm not too far from the city.
It's a poky old dog box with a granny flat in an urban sprawl 18k from the city center.
All the fish-eye lenses and colour correctors in the world can't hide that fact.
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Personally a bit far for me and too ugly but I do see why it is worth a bit.
Yes I know why you think it's worth a bit - because you think another sucker will snap for 2 mil in another year.
"It were not best that we should all think alike; it is difference of opinion that makes horse races." - Mark Twain on why he avoids discussing house prices over at MacroBusiness. "Buy land, they're not making any more of it." - Georgist Land Tax proponent Mark Twain laughing in his grave at humourless idiots like skamy that continually use this quip to justify housing bubbles.
EQUIVALISED DISPOSABLE HOUSEHOLD INCOME - 90th Percentile is $1,688 per week which is about $130,000 gross per annum.
And Sydney will definitely have higher incomes than the country, but 53% higher is probably a stretch.
Right?
Yes, I see that top 10% of Australian households earn $200k+ pa, being $3,979 per week at 90th percentile = $206,908 pa. I'm sure this goes up steeply as well so many earn far more than that.
The figure in Sydney is likely to be at least 15% of households - although that is a guess but given the numbers include households in small outback and coastal towns, centres where retirees gravitate to etc I'd be very surprised if Sydney is less than 15% over $220k pa.
John Frum
15 Sep 2015, 11:11 PM
It's a poky old dog box with a granny flat in an urban sprawl 18k from the city center.
All the fish-eye lenses and colour correctors in the world can't hide that fact.
Yes I know why you think it's worth a bit - because you think another sucker will snap for 2 mil in another year.
There are few places that you can get 800sqm closer than 18k from the city centre and the number of places isn't increasing.
I found a place closer to the city on a somewhat similar sized block (slightly less at around 700sqm): 3 Carieville St, Balmain $3.5m+
That set-up would suit many families (particularly extended families that may pool their money) and accordingly will be sort after even if you and I aren't keen on it.
There is no doubt that it will be worth $2m at some time in the future (this is RBA policy).
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