No doubt, but I'd suggest if they're FHBs they should look at starter homes close to their preferred area, rather than homes priced $200K above the Sydney median. That might mean a unit.
I settled for a place needing work and we used beanbags as furniture for the first couple of years.
Each generation of first time buyers needs to settle for less.
FTB today? Maybe think about buying a single bedroom unit at 30, scrimp and save for 5 years beforehand, get your parents to release some equity from their place and get the best mortgage deal you can, at the lowest rate possible for the longest term possible.
30 years from now? Borrowing 50 x what you will ever earn to lean on a plank for one night?
Matthew, 30 Jan 2016, 09:21 AM Your simplistic view is so flawed it is not worth debating. The current oversupply will be swallowed in 12 months. By the time dumb shits like you realise this prices will already be rising.
Someone who purchased a $584,782 house in June of 2009 would be my first guess.
No one with children could purchase that priced house as their first house today.
The point where housing becomes completely unaffordable for the young is easy to pick. You can see it when the birth rate collapses. Happened in Tokyo and Hong Kong, was beginning to happen in London and Paris before a massive immigration program saw slums of migrants popping out children and collecting welfare. Little wonder Brexit happened. I'm guessing Frexit will be next.
Speak when you are angry and you will make the best speech you will ever regret. Ambrose Bierce
According to Residex the median house price in Perth is $497,500.
I suspect that many a FHB couple in Perth could afford that.
On $50k a year, that is 10x annual salary.
If I were doing the same job today as I was at 22, I would be on less than $50k a year.
I wouldn't be able to buy a Perth property if I transposed my life to today (if I were 22 today and doing the same job).
And therein lies the problem.
Matthew, 30 Jan 2016, 09:21 AM Your simplistic view is so flawed it is not worth debating. The current oversupply will be swallowed in 12 months. By the time dumb shits like you realise this prices will already be rising.
Someone who purchased a $584,782 house in June of 2009 would be my first guess.
No one with children could purchase that priced house as their first house today.
The point where housing becomes completely unaffordable for the young is easy to pick. You can see it when the birth rate collapses. Happened in Tokyo and Hong Kong, was beginning to happen in London and Paris before a massive immigration program saw slums of migrants popping out children and collecting welfare. Little wonder Brexit happened. I'm guessing Frexit will be next.
Actually a collapse in the birth rate would reduce real prices unless immigration increased commensurately.
Japan has about 8 million unused dwellings, and that has reduced prices.
Jimbo
30 Oct 2016, 09:33 PM
On $50k a year, that is 10x annual salary.
If I were doing the same job today as I was at 22, I would be on less than $50k a year.
I wouldn't be able to buy a Perth property if I transposed my life to today (if I were 22 today and doing the same job).
And therein lies the problem.
A couple with two jobs earn more than $50K
Many commentators use the figure from the last Census which I think is about $67K but that's not a particularly relevant figure. Young couples buying a house usually make an effort to have two fulltime jobs or one full time job and maybe 30 hours per week in a part time job.
That will give them a gross income over $100K pa usually.
OK, so they are going to buy their first home/unit for $600,000.
...
The male income earner $65,000 The female income earner $50,000
That's a combined income of $115,000.
It probably means that couples with a household gross income of under $80,000 in Sydney can only buy a one bed unit.
...
Dunno Sydvegas, but wot might a fairly junior copper shacked up wif a Coles checkout chick have coming inta their household as total income these days? (Just as a 'for instance'.)
A Professional Demographer to an amateur demographer:"negative natural increase will never outweigh the positive net migration"
Actually a collapse in the birth rate would reduce real prices unless immigration increased commensurately.
Not immediately, if current owners are in a liquidity trap, or took out multi-generation mortgages. But eventually, yes. In Tokyo it took about 20 years. In Hong Kong, prices are still rising, and the birth rate is still close to zero.
Quote:
Japan has about 8 million unused dwellings, and that has reduced prices.
Eventually, but it took a long time. When you have governments and banks playing a game of "lets pretend", those dwellings still have liens against them, which the banks pretended were going to be paid. Only when the older generation started dying did the banks start writing off some of those loans, making some of those dwellings available. Now the younger generation are so conservative they don't want to borrow anything and save every penny. A good chunk of Japanese real estate is now purchased by Chinese investors.
Speak when you are angry and you will make the best speech you will ever regret. Ambrose Bierce
Dunno Sydvegas, but wot might a fairly junior copper shacked up wif a Coles checkout chick have coming inta their household as total income these days? (Just as a 'for instance'.)
If the copper does a bit of OT then probably $65 to $70K and the checkout chick around $30K - could be up to $45K if working Saturday and Sunday.
Take risks - if you win you will become wealthy, if you lose you will become wise
Dunno Sydvegas, but wot might a fairly junior copper shacked up wif a Coles checkout chick have coming inta their household as total income these days? (Just as a 'for instance'.)
I think a probationary constable, with overtime, makes about $65-75K per year, and most checkout chicks are on casual rates, which is $22 an hour, so it depends on hours worked, or $34,975 p.a if full time.
Not immediately, if current owners are in a liquidity trap, or took out multi-generation mortgages. But eventually, yes. In Tokyo it took about 20 years. In Hong Kong, prices are still rising, and the birth rate is still close to zero.
Eventually, but it took a long time. When you have governments and banks playing a game of "lets pretend", those dwellings still have liens against them, which the banks pretended were going to be paid. Only when the older generation started dying did the banks start writing off some of those loans, making some of those dwellings available. Now the younger generation are so conservative they don't want to borrow anything and save every penny. A good chunk of Japanese real estate is now purchased by Chinese investors.
Well there is always a lag, especially if the CB is involved.
Isn't there high immigration in HK - used to be relevant to population.
Take risks - if you win you will become wealthy, if you lose you will become wise
Isn't there high immigration in HK - used to be relevant to population.
High immigration from China of mostly poor people, and not always the whole family. It used to be that one parent would immigrate and get established then bring the child over to be educated/raised in HK, but it is becoming almost impossible to get established now, so many just leave their family in China and send money home to pay for a better school at home.
It will be interesting to see what happens with Hukuo reform in the next five years.
Speak when you are angry and you will make the best speech you will ever regret. Ambrose Bierce
Australian Property Forum is an economics and finance forum dedicated to discussion of Australian and global real estate markets and macroeconomics, including house prices, housing affordability, and the likelihood of a property crash. Is there an Australian housing bubble? Will house prices crash, boom or stagnate? Is the Australian property market a pyramid scheme or Ponzi scheme? Can house prices really rise forever? These are the questions we address on Australian Property Forum, the premier real estate site for property bears, bulls, investors, and speculators. Members may also discuss matters related to finance, modern monetary theory (MMT), debt deflation, cryptocurrencies like Bitcoin Ethereum and Ripple, property investing, landlords, tenants, debt consolidation, reverse home equity loans, the housing shortage, negative gearing, capital gains tax, land tax and macro prudential regulation.
Forum Rules:
The main forum may be used to discuss property, politics, economics and finance, precious metals, crypto currency, debt management, generational divides, climate change, sustainability, alternative energy, environmental topics, human rights or social justice issues, and other topics on a case by case basis. Topics unsuitable for the main forum may be discussed in the lounge. You agree you won't use this forum to post material that is illegal, private, defamatory, pornographic, excessively abusive or profane, threatening, or invasive of another forum member's privacy. Don't post NSFW content. Racist or ethnic slurs and homophobic comments aren't tolerated. Accusing forum members of serious crimes is not permitted. Accusations, attacks, abuse or threats, litigious or otherwise, directed against the forum or forum administrators aren't tolerated and will result in immediate suspension of your account for a number of days depending on the severity of the attack. No spamming or advertising in the main forum. Spamming includes repeating the same message over and over again within a short period of time. Don't post ALL CAPS thread titles. The Advertising and Promotion Subforum may be used to promote your Australian property related business or service. Active members of the forum who contribute regularly to main forum discussions may also include a link to their product or service in their signature block. Members are limited to one actively posting account each. A secondary account may be used solely for the purpose of maintaining a blog as long as that account no longer posts in threads. Any member who believes another member has violated these rules may report the offending post using the report button.
Australian Property Forum complies with ASIC Regulatory Guide 162 regarding Internet Discussion Sites. Australian Property Forum is not a provider of financial advice. Australian Property Forum does not in any way endorse the views and opinions of its members, nor does it vouch for for the accuracy or authenticity of their posts. It is not permitted for any Australian Property Forum member to post in the role of a licensed financial advisor or to post as the representative of a financial advisor. It is not permitted for Australian Property Forum members to ask for or offer specific buy, sell or hold recommendations on particular stocks, as a response to a request of this nature may be considered the provision of financial advice.
Views expressed on this forum are not representative of the forum owners. The forum owners are not liable or responsible for comments posted. Information posted does not constitute financial or legal advice. The forum owners accept no liability for information posted, nor for consequences of actions taken on the basis of that information. By visiting or using this forum, members and guests agree to be bound by the Zetaboards Terms of Use.
This site may contain copyright material (i.e. attributed snippets from online news reports), the use of which has not always been specifically authorized by the copyright owner. Such content is posted to advance understanding of environmental, political, human rights, economic, democratic, scientific, and social justice issues. This constitutes 'fair use' of such copyright material as provided for in section 107 of US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed for research and educational purposes only. If you wish to use this material for purposes that go beyond 'fair use', you must obtain permission from the copyright owner. Such material is credited to the true owner or licensee. We will remove from the forum any such material upon the request of the owners of the copyright of said material, as we claim no credit for such material.
Privacy Policy: Australian Property Forum uses third party advertising companies to serve ads when you visit our site. These third party advertising companies may collect and use information about your visits to Australian Property Forum as well as other web sites in order to provide advertisements about goods and services of interest to you. If you would like more information about this practice and to know your choices about not having this information used by these companies, click here: Google Advertising Privacy FAQ
Australian Property Forum is hosted by Zetaboards. Please refer also to the Zetaboards Privacy Policy