# House buying in Adelaide



## jasoni (27 September 2007)

Hi guys,

I am saving for a house deposit currently, and am thinking about entering the market in the next 6-12 months. Being only a young fella, and somewhat un-edumacted regarding property trends and where we are currently in the 'housing cycle' I would like some opinions as to whether my timing for entering the market is good/not so good.

Can anyone give me a little advice?


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## wayneL (27 September 2007)

jasoni said:


> Hi guys,
> 
> I am saving for a house deposit currently, and am thinking about entering the market in the next 6-12 months. Being only a young fella, and somewhat un-edumacted regarding property trends and where we are currently in the 'housing cycle' I would like some opinions as to whether my timing for entering the market is good/not so good.
> 
> Can anyone give me a little advice?


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## jasoni (27 September 2007)

wayneL said:


>




Is that a not-so-good from Wayne??


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## Smurf1976 (27 September 2007)

There is a very long running thread on this site with over 2000 posts on the subject. https://www.aussiestockforums.com/forums/showthread.php?t=1977

Opinion is split and some views are held quite strongly. Basically it comes down to "house prices will fall" versus "prices are rising" and "you can still afford to buy if you save hard, don't want a mansion etc". The one notable point is that few seem to expect a major boom - it's slower growth versus no (or negative) growth for most (there are exceptions of course).

Many will point to recent price falls in the US which have been spectacular in some areas. Others will argue that Australia isn't the US and that prices here have been rising.

Personally, I would argue that based on my own observations in Tasmania (which is of course not SA) prices are rising slowly but the quality of houses has also substantially increased. Prices for the same house aren't changing much and haven't since at least 2004. It's just that the cheaper houses are being renovated thus lifting the average price of those for sale.

Another key argument is the risk of a serious rise in inflation which takes everything, house prices included, along with it. Possible but by no means certain. Others will argue that deflation and falling prices is more likely.

My own best guess is another interest rate rise in either October or November leading to short term stagnation in the market. After that it's anyone's guess but I would make the observation that the trend of the past few years of slow wages growth and gradually rising interest rates doesn't enable average house buyers to pay rapidly increasing prices forever. It doesn't necessarily stop investors however - renting may become more common rather than prices falling.


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## wayneL (27 September 2007)

jasoni said:


> Is that a not-so-good from Wayne??



LOL, no. It means it's an unsolvable question unless in hindsite. We all have our opinions, as outlined by Smurf, and the battle line will be drawn out as per other threads.

It means "Oh no! not another real estate thread!" 


Just joke really.


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## jasoni (27 September 2007)

I guess the recent news about America has somewhat put sand in my pants.. and naturally the fear that a house I just purchase is dropping in value scares me..


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## theasxgorilla (27 September 2007)

I know there are plenty from SA who are gonna rip me a new one for this post but...

If you take a macro-view of property in Aust I would say that Adelaide is not the capital city voted most likely to succeed in the long run.  Prior to this boom there were a lot of areas in Adelaide getting smacked with high unemployment and such things symptomatic of low-growth.  IF/WHEN the boom slows or reverses I'd expect these areas to get smacked again.  At this point in whatever reminiscence of a cycle we're having I think you've got to think defence more than ever.

The answer to your question depends on your time frame.  If you want to hold for the long term and hedge against a negative-equity situation then I reckon you want to be in an as upmarket area as possible.  In Adelaide these seem to emanate out from around Glenelg and Brighton.  If there is a right side of the highway, so to speak, try to be on it.  If you can manage walking distance to the beach and proximity to the aforementioned suburbs expect to NEVER have a problem getting a good price for whatever property you hold.

If affordability is an issue and you need to start down the lower end, consider a fixer-upper project of a flat or apartment in a more upmarket area.  Live there yourself while you do the work (it's hell, but can be worth it) and take advantage of the first home buyers grant to offset against stamp duty AND the capital gains tax exemption on a primary place of residence...ie. you get to keep all the profits.  Do this well once or twice and you can roll over your equity into something bigger and better.


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## tech/a (27 September 2007)

I've pm'd you.


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## Pommiegranite (27 September 2007)

theasxgorilla said:


> If affordability is an issue and you need to start down the lower end, consider a fixer-upper project of a flat or apartment in a more upmarket area. Live there yourself while you do the work (it's hell, but can be worth it) and take advantage of the first home buyers grant to offset against stamp duty AND the capital gains tax exemption on a primary place of residence...ie. you get to keep all the profits. Do this well once or twice and you can roll over your equity into something bigger and better.




...and make sure you sell the property yourself. Agents fees will chomp into any profits.

http://www.nocommission.com.au/


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## theasxgorilla (27 September 2007)

Pommiegranite said:


> ...and make sure you sell the property yourself. Agents fees will chomp into any profits.




I know it's popular to bash agents but I actually think a good agent is worth their commission.  But if you can do it yourself...more power to you.


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## tech/a (27 September 2007)

theasxgorilla said:


> I know it's popular to bash agents but I actually think a good agent is worth their commission.  But if you can do it yourself...more power to you.





Agree.

Commisions are negotiable and for a few % you get top dollar.No hassel no opens,no calling and negotiating (until you get a contract).
Just offer them 10% of anything over your sell price write it up and watch them go.
I've had to pay $5400 more once---nearly killed me!!


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## Pommiegranite (27 September 2007)

tech/a said:


> Agree.
> 
> Commisions are negotiable and for a few % you get top dollar.No hassel no opens,no calling and negotiating (until you get a contract).
> Just offer them 10% of anything over your sell price write it up and watch them go.
> I've had to pay $5400 more once---nearly killed me!!




I disagree. Surely this depends on what the value of the home is.

Remember, the OP is a first time seller. 

Lets say his asking price for this house for $500K and the agent is charging 3% upto $500K and 10% over $500K.

I don't expect an agent to bust a gut to sell this house for $520K when this would net him $17K, as opposed to $15K commission for selling at $500K.

The $2k wouldn't be viewed as worth the risk of losing a potential sale.
In this price range, agents view a 'bird in the hand', as worth more than 'two in the bush'.

Now a property for $1.5million+ might be a different matter.

I reckon its best to look at sold prices, and get as many quotes/commision schedules as possible.


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## Kathmandu (27 September 2007)

An Australian property forum where you will get more answers than you will here

http://www.somersoft.com/forums/

Dave


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## Kathmandu (27 September 2007)

Pommiegranite said:


> Remember, the OP is a first time seller.




Actually, the OP is a first time BUYER, so no commission payed by them

Dave


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## Pommiegranite (27 September 2007)

Kathmandu said:


> Actually, the OP is a first time BUYER, so no commission payed by them
> 
> Dave




We're talking about moving up the ladder by buying and then selling his first property, making a profit and then buying again.

He would therefore be a first time seller, and would have to pay an agent commission to sell.


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## Kathmandu (27 September 2007)

Pommiegranite said:


> We're talking about moving up the ladder by buying and then selling his first property, making a profit and then buying again.
> 
> He would therefore be a first time seller, and would have to pay an agent commission to sell.




Gee, I missed that bit , maybe you can point it out to me?





> Hi guys,
> 
> I am saving for a house deposit currently, and am thinking about entering the market in the next 6-12 months. Being only a young fella, and somewhat un-edumacted regarding property trends and where we are currently in the 'housing cycle' I would like some opinions as to whether my timing for entering the market is good/not so good.
> 
> Can anyone give me a little advice?




Dave


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## nioka (27 September 2007)

Pommiegranite;206684
 He would therefore be a first time seller said:
			
		

> Not necessary to pay an agent. A large percentage of buyer enquiries are obtained by agents from a sign on the property. I have sold in the past and will again with my own sign. It is easy to do some advertising and there are even some free web sites available.


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## Pommiegranite (27 September 2007)

Kathmandu said:


> Gee, I missed that bit , maybe you can point it out to me?
> 
> 
> 
> ...




Gee...here you go Dave. I was replying to the previous post...and did quote it. That's how conversations evolve.



> *If affordability is an issue and you need to start down the lower end, consider a fixer-upper project of a flat or apartment in a more upmarket area. Live there yourself while you do the work (it's hell, but can be worth it) and take advantage of the first home buyers grant to offset against stamp duty AND the capital gains tax exemption on a primary place of residence...ie. you get to keep all the profits. Do this well once or twice and you can roll over your equity into something bigger and better.*


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## Pommiegranite (27 September 2007)

nioka said:


> Not necessary to pay an agent. A large percentage of buyer enquiries are obtained by agents from a sign on the property. I have sold in the past and will again with my own sign. It is easy to do some advertising and there are even some free web sites available.





We really are going around circles.

Here's my first post again for those who missed it:



> ...and make sure you sell the property yourself. Agents fees will chomp into any profits.
> 
> http://www.nocommission.com.au/


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## Kathmandu (27 September 2007)

Fair enough, 

As an aside I contacted that http://www.nocommission.com.au/ crowd about sale of one of mine, and at this stage they ONLY list in states they have an agency in, which was not QLD, not sure on other states yet

Dave


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## Pommiegranite (27 September 2007)

Kathmandu said:


> Fair enough,
> 
> As an aside I contacted that http://www.nocommission.com.au/ crowd about sale of one of mine, and at this stage they ONLY list in states they have an agency in, which was not QLD, not sure on other states yet
> 
> Dave




Dave, I heard something about them being operational here by the end of this year.  What I think is great is that they list on domain.com.au.


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## Kathmandu (27 September 2007)

Pommiegranite said:


> Dave, I heard something about them being operational here by the end of this year.  What I think is great is that they list on domain.com.au.




Never liked Domain, but they also list on RE.com

I think most Property purchaser's would use RE.com

Dave


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## Smurf1976 (27 September 2007)

Kathmandu said:


> I think most Property purchaser's would use RE.com



I think you will find a lot of younger buyers especially won't know about any house for sale that is not on that site. Not many are going to bother checking in agent's windows etc when you can check most agents all at once in less than a minute online.


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## jasoni (27 September 2007)

Smurf1976 said:


> I think you will find a lot of younger buyers especially won't know about any house for sale that is not on that site. Not many are going to bother checking in agent's windows etc when you can check most agents all at once in less than a minute online.




Very true, over the past 3 months researching whats available on the market, its all been from RE and Domain..


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## INORE (27 September 2007)

well seeing as this thread is specifically about buying in adelaide......does anyone think that with the olympic dam expansion being so huge that SA may become another mining boom state in the future???  I heard a guy at work today saying something along the lines of 'i read that SA will become the saudi arabia of uranium, as u3o8 is touted as the worlds next major energy source and SA has a huge % of it'.....

i know there as far as production and processing goes we are comparing apples and oranges but can anyone see multiple huge mines happening in SA within the next 10 years?


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