# Are rents too low?



## Realist (13 February 2007)

The Reserve Bank thinks so...

www.smh.com.au/news/national/rents-too-low-bank-warns/2007/02/12/1171128899933.html

While house prices have increased 175 per cent since the mid-1990s, rents have increased only 35 per cent on the Bureau of Statistics' measure,

They say rental yields are too low compared to other countries.

I agree!!  But only because house prices are too high. They are clearly overvalued on a global scale.

Rents are normal to slightly below normal, houses are overvalued.

Australia is the emptiest country in the world, if you think paying megabucks for a tiny block of land is a great investment, think again!!


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## tech/a (13 February 2007)

Yes they are.

This is reflected in the high demand for rentals and the terribly low vacancy rates.

Which leads to the question---"Where are all these rentals held by all these over geared over debted investors???"


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## theasxgorilla (13 February 2007)

I love these property threads...really polarises opinion like no other.

Rents are low here because of negative gearing.  If you want to collapse property prices and/or re-balance yields, unwind negative gearing.


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## Rafa (13 February 2007)

Realist said:
			
		

> Australia is the emptiest country in the world, if you think paying megabucks for a tiny block of land is a great investment, think again!!




If thats the case, why don't you buy a place in the middle of nowhere for 10 bucks!

Then work out how you are going to get your groceries, get to your place of employment, get water, electricity, sanitation, etc, etc...

I guess you'll want handouts from the taxpayer to pay for all that...


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## insider (13 February 2007)

I certainly hope not otherwise I'm living at home longer... A crummy apartment at the docklands costs $350 a week... I can stay at a back packer hostel in the CBD for $280 a week... something isn't right


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## theasxgorilla (13 February 2007)

insider said:
			
		

> I certainly hope not otherwise I'm living at home longer... A crummy apartment at the docklands costs $350 a week... I can stay at a back packer hostel in the CBD for $280 a week... something isn't right




A "crummy" apartment in Docklands...my you have some standards.  I thought Docklands was _nice._


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## insider (13 February 2007)

theasxgorilla said:
			
		

> A "crummy" apartment in Docklands...my you have some standards.  I thought Docklands was _nice._




It is nice... it's a small appartment that's what makes it crummy... The thing about apartment living is that the bar becomes your lounge room because yours is too small


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## Duckman#72 (13 February 2007)

Realist said:
			
		

> They say rental yields are too low compared to other countries.
> 
> I agree!!  But only because house prices are too high. They are clearly overvalued on a global scale.
> 
> Rents are normal to slightly below normal, houses are overvalued.




I agree wholeheartedly Realist. 

There was a study done of house prices in Western Countries compared to annual average earnings and Australia was considered the highest (as in most overpriced of all countries examined). It was a very interesting article - it was in _The Australian_ about a month ago.   

Duckman


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## theasxgorilla (13 February 2007)

insider said:
			
		

> It is nice... it's a small appartment that's what makes it crummy... The thing about apartment living is that the bar becomes your lounge room because yours is too small




James Squires bar?  It could be worse...


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## BIG BWACULL (13 February 2007)

Rafa said:
			
		

> If thats the case, why don't you buy a place in the middle of nowhere for 10 bucks!
> 
> Then work out how you are going to get your groceries, get to your place of employment, get water, electricity, sanitation, etc, etc...
> 
> I guess you'll want handouts from the taxpayer to pay for all that...




10 bucks !! sweet count me in, I'll spend the rest of my wealth on  cows, sheep for milk and meat, I'll Just S%$#T on my garden for groceries, Solar panels and batteries for my electricity, Grow some smoko   for biodiesel for my ute and in 50 years your kids can can buy my land back For millions now thats an investment, Do the hard yards now and the rest will follow  
If you want a job on my $10 Farm your more than welcome. A town in queensland a few years back offered a limited number of $1 blocks to revitalise the town they were gobbled up, Then a mining boom hit in the area and these homes now dont sell for under 400,000 and there still trying to keep with demand for For tradesmen to cope with growing demand in this area.Hows this, about 6 months earlier the local real estate agent packed up and moved to tassie due to lack of sales, Better luck next time.   i.e INVEST INVEST INVEST forget the quick buck.Good things come to those who wait


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## BIG BWACULL (13 February 2007)

You're all welcome to come live on my eco farm minimum $1000 a week just gotta find this $10 land.


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## Rafa (13 February 2007)

Exactly... Apparently we have plenty of land in Oz thats inhabitable...


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## GOYCO (13 February 2007)

Rents are way too low...removing negative gearing has been tried before and nearly crippled the tenants. The government realised that they would have to provide a lot more housing for people who could not afford the rent. That is why it was brought back in..expect the rents to be 30% higher in 3 years time.

cheers


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## Smurf1976 (13 February 2007)

Rents would need to more than double in the major capital cities to get back to a normal yield on housing. And if there's one tried and tested rule of investing, it's that yields revert to the mean eventually. So rents double or house prices crash (or some combination of the two).

With a boom in rents comes, of course, a very significant rise in CPI and likely interest rates too. 

And so the inflation slowly works its way through the economy. First stocks. Then real estate. Then mineral commodities. Now soft commodities. Next consumer prices including rent. Then wages.


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## TjamesX (13 February 2007)

> The Reserve Bank thinks so...
> 
> http://www.smh.com.au/news/national...1128899933.html
> 
> ...




Lets see, I wonder which of the two is out of whack....mmmm

So a 35% increase in rents I calculate as a 3.04% compound growth in rents over 10 years - so pretty much in line with (actually a bit above!!) inflation ... which is what you'd expect given this is a large component of the CPI basket. It is also broadly inline with wages growth (although I think some suggest wages growth has been below CPI)..... all in all you'd say that rent increases have not been 'cheap' - unless you believe that dwelling rents should increase greater than wages growth.... in which case ever greater amounts of a persons income should go towards rent until it takes up 99.9% of the income pie??? hard to believe given that this hasn't been the case for the last couple of thousand years of population growth....


On to housing... 175% growth which equates to 10.65% compunding over 10 years. Yep that does seem pretty high.... but it didn't affect the inflation rate because house prices aren't included... if rents did match this growth rate (or even half of it) in the last 10 years, then what do you think the inlfation figures would have been and as a result what would have the RBA done with interest rates??? thats right they wouldn't have been increasing interest rates pretty savagly back in 2000-2003 instead of DROPPING them.. in which case house prices would have never got to the point they did in the first place.....

Any land lord who wishes to raise rents to bridge the gap now - will have to push rents above CPI target rate (2-3%)..... then the RBA has to lift rates ...... then the landord has to raise rents ... then the RBA has to raise rates... landlord raises rents.... and so on

Its what you get when inflation isn't recorded as inflation!!!!  

How does this system correct - well real house prices don't go anywhere for a looong time, they haven't for the last 3 years. I reckon there's at least 3 more to go



			
				GOYCO said:
			
		

> Rents are way too low...removing negative gearing has been tried before and nearly crippled the tenants. The government realised that they would have to provide a lot more housing for people who could not afford the rent. That is why it was brought back in..expect the rents to be 30% higher in 3 years time.
> cheers




So in the last boom did negative gearing work?? .... did it supply more houses??.... NO and NO. 10% of investors money went into new housing - the rest pushed up prices on existing housing.... it doesn't work - because once people pay the huge prices and the game stops, they want some money back and so push up rents

The policy doesn't work because its a federal govt policy designed to increase supply. But who actually controls supply??? State governements - and they seem pretty incompetent about the whole thing.

If the houses don't get built - the policy doesn't work... end of story.

TJ


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## GOYCO (14 February 2007)

_"So in the last boom did negative gearing work?? .... did it supply more houses??.... NO and NO. 10% of investors money went into new housing - the rest pushed up prices on existing housing.... it doesn't work - because once people pay the huge prices and the game stops, they want some money back and so push up rents

The policy doesn't work because its a federal govt policy designed to increase supply. But who actually controls supply??? State governements - and they seem pretty incompetent about the whole thing.

If the houses don't get built - the policy doesn't work... end of story."_


I don't know which country you were in but the answer was a resounding yes and yes. Didn't you hear about the glut of apartments in Melbourne and Sydney in 2003??? 

If this is a feeble attempt at keeping your rent down then I'm sorry to be the bearer of bad news.  Other than Perth and Darwin house prices are not coming down any further and rents are going to increase above the CPI. The rise of rents is only one factor in many determining inflation. The hole inyour argument is that the RBA use monetary poicy ( interest rates ) as a retarder of inflation NOT to fuel inflation. Therefore increases in rent to their long term average will NOT cause the RBA to increase rates. 

Higher rents are here to stay, get used to it. The government will not stop the forces of supply and demand and they certainly do not want to go back to the dark old days" of trying to house a greater portion of the population.

All the above statements are in my own personal opinion and should be regarded as such

cheers


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## Go Nuke (14 February 2007)

OMG..I cant believe you think rent is too low!!!!!  

You must be paying a morgage or something. Because rents are almost at the same rate as a morgage repayment...AND THATS SERIOUSLY WRONG!

I live in Brisbane and work as a boilermaker...income of about less than $700 (after tax)/week. My rent for a 2 B'room unit about 5ks from the city is $275/week. YOU do the maths!

Mate, if rents increased much more...its the less well off that will pay the ultimate price.
You would have to weigh up moving further away from work and battling 1-1 and a half hrs of traffic each day....each way...or fork over more money to pay some1 elses mogage and get stuck in the rent trap for life.


Analysts have already stated that we are going to have a generation of people that will NEVER own a home.

Personally...Ive given up. Thats y i buy shares now

No wonder the birth rate has been in decline! It takes 2 good wages just to cover the morgage.

Unless Im missing someone's point on increasing rent...you high flying yuppies need your heads read and a dose of reality


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## moses (14 February 2007)

One way or other the law of supply and demand will equalise the forces. 

Ironically, those who have decided it makes better sense to rent and invest in shares will have more income to to pay the rent; and thus drive rents up anyway.

If house prices aren't factored into the CPI...then as Goyco says, thats inflation in denial. Eventually it will work its way through and rent will rise, wages will rise, inflation will rise, interest rates will rise. 

Todays shortage of rental properties can only be fixed by better value for property investors; either rents must rise substantially or capital growth (house prices rise) or shares plummet. 

At the moment the new super rules are encouraging investers to sell before July...so at the very least we should expect house price to remain depressed until July, shares to do well before July, and rent to rise before July.

Perhaps the next few months will be as good an opportunity to buy a house as any.


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## Smurf1976 (14 February 2007)

Go Nuke said:
			
		

> No wonder the birth rate has been in decline! It takes 2 good wages just to cover the morgage.



Yet another way millions lose from expensive housing.

"Good news, petrol prices went up 50%". Most wouldn't call that good news (and I say that as a very long term oil bull).

"Good news, food prices just doubled". Not good news in the opinion of most.

"Good news, the price of houses just went up". No different to the above two examples unless you're a speculator in either oil, dairy or housing.

We seem to have developed a mindset that rewards speculation an punishes genuine productive activity. Anything but good news in the long term.


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## tech/a (14 February 2007)

> Because rents are almost at the same rate as a morgage repayment.




So why rent?
Why not purchase and keep ahead of capital growth?

Think about it a 5% growth in a 400K property means you have to put away $20000 a year just to keep ahead of Capital appreciation.
or $200/week at 2.5%.

Havent got a deposit---Either join with someone who can help.
Friend if not married or Partner and get one as soon as possible.
Its even worth looking at a low doc loan when you really look at the figures.--IE 5% deposit.
If you buy a house you can even rent out a room.

There was a story here about a guy who rents rooms to air hostie who are away more often than home at $150 a week---he wins they win.

FIND A WAY.

We all had to and it wasnt/isnt easy AT FIRST.


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## Freeballinginawetsuit (14 February 2007)

As tenancy's are ending in investment properties you can virtually name your price (within reason) to prospective tenants, screen hords of them for the best candidate and write in little bonus maintenance clauses (pool and garden maintenance etc) into your lease agreement with youre tenant.

Most tenants are just keen to secure a home for their family, As my lease agreements run out with tenants I will certainly be taking advantage of the marketplace in WA at the moment, who wouldn't.

In the end its always nice just to be able to provide a home to a responsable family who is unable to buy one......nice feeling


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## Realist (14 February 2007)

tech/a said:
			
		

> So why rent?
> Why not purchase and keep ahead of capital growth?
> 
> Think about it a 5% growth in a 400K property means you have to put away $20000 a year just to keep ahead of Capital appreciation.
> or $200/week at 2.5%.




If rents are the same as mortgage repayments, which they certainly are not in Sydney. Then buying would seem logical...

However, you need to be sure you are not paying too much for your house. Capital gains are not a certainty, I have alot of friends that have made captial losses recently.

If you have $50K, and you put it towards a $400K place and it goes up 5%. That sounds great!  But....

You've paid 8% on $350K in interest, which is $28K
You've paid body corporate fees, rates, water, insurance of at least $6K
Repairs, paint, maintenance etc. of a conservative $2K

So you've paid $36K to make $20 in a capital gain - not good is it? A $16K loss.

And if you make a 5% capital loss - you just lost yourself $56K.

Sure if you don't buy you need to rent, but you can invest your $50K in shares!!  And with some good mangement it may very well pay for you to rent for a year.

Rushing in to buy a house so recently after a property boom is not wise.


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## forexgame (14 February 2007)

I bought last year a house and rented my apartment. Both of them are grew up in value. I think real estate is a great investment.


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## chops_a_must (14 February 2007)

Freeballinginawetsuit said:
			
		

> As tenancy's are ending in investment properties you can virtually name your price (within reason) to prospective tenants, screen hords of them for the best candidate



This really isn't a good thing though. A bunch of my friends moved over east because a) they couldn't afford to live here and b) no-one was prepared to let a young person rent... which is rubbish. In the end, it's not healthy for the long term.


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## Realist (14 February 2007)

forexgame said:
			
		

> I bought last year a house and rented my apartment. Both of them are grew up in value. I think real estate is a great investment.




Well that seals it then...


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## krisbarry (14 February 2007)

Ohhh no   Not another housing thread 

The last thead made me sick, angry frustrated and just down right pi_ssed off. 

Good luck, as a few members might get their heads chopped off :axt:


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## krisbarry (14 February 2007)

I have learnt some new skills of late:

Not to buy into other peoples issues, I will be employing it on this thread.

I have no further comments on housing/rents etc etc


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## krisbarry (14 February 2007)

BUT I MUST SAY THIS:

I will make myself quite clear...discussing housing/rents affordability is a very touchy area for many, so be careful what you say, as I have been directly affected by some of the comments discussed on this forum.  I am quite shocked at the lack of respect some are showing towards those that have very little, or live in unstable housing environments for whatever reason.

...Just a few words of advice...to those that want or feel the need to jack up rents, who are you hurting?  Your sons, and daughters!

*Why do you want to hurt your own flesh and blood...its downright disgusting?*


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## Freeballinginawetsuit (14 February 2007)

chops_a_must said:
			
		

> This really isn't a good thing though. A bunch of my friends moved over east because a) they couldn't afford to live here and b) no-one was prepared to let a young person rent... which is rubbish. In the end, it's not healthy for the long term.




Totally agree with you Chops, its not a good thing at all, and I would never lump all young people in the same boat. By the way I,m only 33 so not that old yet  .

I really feel for the teenagers of today, they are in a sticky boat and will never realize home ownership with out some help from the folks or some punts on the stockmarket  .

But the writing was on the wall a good ten years back and many off those young crew hocked into a car, pissed their money up the wall, bought gadgets etc etc. Many didn't and invested wisely or set goals, its a hard life and only getting harder > you reap what you sow!.

If you travelled years back it was self evident urban areas in OZ would become 'Leggo Lands' with smaller blocks, sprawled and a generation of renters. Just go to the UK in the nineties, it was plain too see.

I have no answers........for today's predicament, just proud of the fact I set goals to not be one of the statistics.


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## Julia (14 February 2007)

Stop_the_clock said:
			
		

> BUT I MUST SAY THIS:
> 
> I will make myself quite clear...discussing housing/rents affordability is a very touchy area for many, so be careful what you say, as I have been directly affected by some of the comments discussed on this forum.  I am quite shocked at the lack of respect some are showing towards those that have very little, or live in unstable housing environments for whatever reason.
> 
> ...



STC

You want everyone to be sensitive to not hurting your feelings, but you give little indication of any similar sensitivity to anyone else's feelings in your comments.
Seems like yet another version of the familiar refrain of "poor me".

Julia


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## coyotte (14 February 2007)

GOYCO said:
			
		

> Rents are way too low...removing negative gearing has been tried before and nearly crippled the tenants. The government realised that they would have to provide a lot more housing for people who could not afford the rent. That is why it was brought back in..expect the rents to be 30% higher in 3 years time.
> 
> cheers




If I remember correctly , the period you are referring to ( nil neg gearing ) housing over that period would have become the most affordable ever -- Prices stagnated whilst incomes grew --- Rents where dear relative to the value of the property BUT the property value was low, making it fare easier for young families to jump in and buy their first home ---- what buggered it up was when neg gearing was reintroduced and land values tripled in as many years.

given a chance (nil neg gearing) all our kids would now probably have their own homes.

and no this is not sour grapes as during that period i aquired a few rentals myself.


Cheers


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## wayneL (15 February 2007)

coyotte said:
			
		

> If I remember correctly , the period you are referring to ( nil neg gearing ) housing over that period would have become the most affordable ever -- Prices stagnated whilst incomes grew --- Rents where dear relative to the value of the property BUT the property value was low, making it fare easier for young families to jump in and buy their first home ---- what buggered it up was when neg gearing was reintroduced and land values tripled in as many years.
> 
> given a chance (nil neg gearing) all our kids would now probably have their own homes.
> 
> ...



Couldn't agree more Coyote


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## bingk6 (15 February 2007)

Realist said:
			
		

> If rents are the same as mortgage repayments, which they certainly are not in Sydney. Then buying would seem logical...
> 
> However, you need to be sure you are not paying too much for your house. Capital gains are not a certainty, I have alot of friends that have made captial losses recently.
> 
> ...




You have hit the nail right on the head. In addition to the overheads that you mentioned, lets not forget that the overheads associated in buying/selling a property (stamp duty, solicitors charges, real estate agent fees etc etc). The trasactional cost associated with property is very significant relative to shares.

You would purchase a property only if you are confident of capital gains, as that is your only means of offsetting those overheads. But as you pointed out, capital gains are not a certainty (at least, not for the next year or so).

Off course, as with all asset classes, there are cycles involved. The time for property will unquetionably come again and with the transactional costs associated with property, it really does pay to remain patient. No future in firing your bullets prematurely.


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## happytrader (15 February 2007)

tech/a said:
			
		

> So why rent?
> Why not purchase and keep ahead of capital growth?
> 
> Think about it a 5% growth in a 400K property means you have to put away $20000 a year just to keep ahead of Capital appreciation.
> ...




Just following on from Techs excellent advice. I noticed in the last Sunday Mails TV Guide, an advert saying 'spare room? Homestay families needed. Enjoy a wonderful experience hosting international students. Earn up to $245 per student per week. Up to 3 students per home. Transport the students to and from college each day. Earn $185 per student per week. Up to 2 students per home. Students make their own way to and from college via public stransport within 30 mins of the college.' Shafston International College

Can't get much better than that imho.

Cheers
Happytrader


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## tech/a (15 February 2007)

This thread reminds me of a little story and we can see the players clearly in that story in this thread.


*2 Salesmen working for a shoe company are sent to investigate the possiblilty of selling shoes to the Chinese. Both are away 1 mth and both come back to their sales manager to report.

 Salesman(1) Well I can tell you there is no way we should waste time effort money and rescources trying to sell shoes to the Chinese. I travelled 1000s of miles and hardly saw anyone wearing shoes.

Salesman(2) WOW what an amazing opportunity---I travelled 1000s of miles and I saw hardly anyone wearing shoes!*

As another poster on this site once wisely said---Perception IS everything!

*Some get it others never will*


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## GOYCO (15 February 2007)

coyotte said:
			
		

> If I remember correctly , the period you are referring to ( nil neg gearing ) housing over that period would have become the most affordable ever -- Prices stagnated whilst incomes grew --- Rents where dear relative to the value of the property BUT the property value was low, making it fare easier for young families to jump in and buy their first home ---- what buggered it up was when neg gearing was reintroduced and land values tripled in as many years.
> 
> given a chance (nil neg gearing) all our kids would now probably have their own homes.
> 
> ...




What do you want?????   Cheaper houses or cheaper rent?  Honestly if you remove negative gearing property will be an income asset and the government will have to pick up the tab for housing a fair chunk of the population. Why do you think they brought it back in. Because the government is a lousy landlord. Don't really understand your argument. Without investors who would provide the housing? If you want to buy a house do what everyone else had had to do. Save for it and go without for a while. The government will even give you some money to help out. 

cheers


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## Go Nuke (15 February 2007)

tech/a said:
			
		

> So why rent?
> Why not purchase and keep ahead of capital growth?
> 
> Think about it a 5% growth in a 400K property means you have to put away $20000 a year just to keep ahead of Capital appreciation.
> ...




Have you heard of the "Rents Trap"?
Its tough to rent close to work AND save a laughable 20k a yr +survive.
$265+200 ...hmmm without food etc..


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## tech/a (15 February 2007)

Err thats my point.

Find away out of the trap.
Of course the other alternative is simply 
slosh around in it and complain.


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## wayneL (15 February 2007)

tech/a said:
			
		

> Err thats my point.
> 
> Find away out of the trap.
> Of course the other alternative is simply
> slosh around in it and complain.



Agree,

But "BUY NOW" may not be the appropriate strategy to advise.


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## tech/a (15 February 2007)

Be sure to let me know when to buy then.

Also where.
Also why.

Its called due dilligence.
There are a myriad of reasons why not--- but Ive not seen ANY---suggestions other than a few from myself and a couple of others---nothing from the renters! As to how they intend to get off the Rent Roll.

The ONLY suggestion Ive seen is wait for property prices to fall.

Fall to what level?
Where?
Why--wait for a specific place/area you can get off the rent roll and into capital appreciation OUTSIDE your own backyard.

I dont think they want to.
Its so far out of their comfort zone they have sleepless nights.
What on earth they are doing trading shares with their meagre $$s that they cannot afford to put at even the slightest risk---I'll never know.

Go sell shoes I say!


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## Mofra (15 February 2007)

tech/a said:
			
		

> Its called due dilligence.
> There are a myriad of reasons why not--- but Ive not seen ANY---suggestions other than a few from myself and a couple of others---nothing from the renters!



I am renting the place I live in, and intend to for some time. Crunching the numbers, I've found I'm better off buying an investment property that represents approx. 1/3 of what I could borrow, and gear the rest into shares & managed funds (weighted towards capital protected products). I intend to buy every 2-3 years, and after acquiring 3 -4 properties rolling up into more exclusive suburbs with larger properties.

I'd like to think that, given even modest capital appreciation, in the long term I will have invested in the right areas, have multiple investment sources providing a return, hold a hedge against a rent price explosion & still get to live in an area I really enjoy without having a major impact on my current lifestyle.

It amazes me the number of people who do not have a financial plan beyond complaining about those that do...


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## Freeballinginawetsuit (15 February 2007)

It is said by many an expert that it is wiser to rent and invest youre capital in the market........ both's good I believe. But you never have control over publicly listed companies future (unless youre a large holder), youre own home you do.

What is pertinent is controlling one's destiny. At least owning the roof over your head allows a certain amount of this.

You pay no rent, you dont have to move, youre family has security of their aboad, youre kids live in their own home, no mortgage  >means no risk, you can gain simple enjoyments from doing up youre own place etc etc.

Renting allows none of this. Sure youre cost is fixed, but the certainty of the roof over youre head is not. Yes if you can move to another rental at a whim but their are costs involved, family issues etc etc.

And yes its bricks and mortar, it will always have a relative net worth, even unrealistic ones like the last few years at certain times in the property cycle


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## nioka (15 February 2007)

Go Nuke said:
			
		

> Have you heard of the "Rents Trap"?
> Its tough to rent close to work AND save a laughable 20k a yr +survive.
> $265+200 ...hmmm without food etc..



Work longer hours or get a second part time job if that is the only way. A lot of us did that to get where we are now.  
 If you don't then you are either a winger or a loser. The only one who can help is yourself.
 I once gave a job to an ex POW (Burma Railway). He lived 10km away. I asked him how he was getting to work after he had been there a week. His answer was walking. He also was cleaning at a hospitol at night and said he would be able to buy a car in a few months time.
 And you are complaining.  Please excuse me if I seem cranky but you young ones these days seem to want more than you are prepared to give.


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## chops_a_must (15 February 2007)

nioka said:
			
		

> Please excuse me if I seem cranky but you young ones these days seem to want more than you are prepared to give.



I think that's pretty harsh. I started my own business at a time when I was at both University and Tafe. A lot of my friends my age or slightly older I would class as workaholics.

I think a lot of the resentment lies in the lack of stability that my generation seem to have to cope with, compared with what most of our parents dealt with. Very little cost for education, no pressure to have the latest gadgets, and seemingly low expectations. Now every hack of a youngster seems to have to be a genius, earning big bucks or only being educated directly for a wealth related occupation, rather than for enjoyment.

For me and a lot of my friends... it's a matter of waiting this out... and by the time we are in positions where we can afford property, there will be enough people defaulting for us to come and make a mint on their mistakes. But for the next 5-10 years, it's going to be pretty hard.


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## theasxgorilla (15 February 2007)

nioka said:
			
		

> And you are complaining.  Please excuse me if I seem cranky but you young ones these days seem to want more than you are prepared to give.




I love it when someone who remembers, reminds us about how good we've actually got it.  Granted that we have new and different challenges, I wouldn't trade the challenges of the era you speak of Nioka, for today.  I'll keep 2007 thanks.


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## coyotte (15 February 2007)

Just a alternative cynical view:

What brought about the last two booms apart from land values generally doubling every decade?

Could the first one 1988 have had anything to do with Bob Hawke's betrayal to the union movement, hence setting the scence for lower wages and conditions for employees ---- hence lower building costs -- with lower relative building costs the only way out was increased land values. 

The second one 200? when these changes started to take effect, with falling relative building costs the only way out was again to increase land values.

With John Howard's new industrial laws the same cycle is now inevitable.


Also interesting that the three nations involved in the Iraq slaughter are the same three nations where land values have skyrocketed --- govt passing on debt to the public sector? --- apparently none of this has occured in Europe.

Used to be a economic theory that as the wealth of a nation becomes concertrated the outcome is always recession and possible depression.
Looks like Keating may have been right "Banana Republic" here we come.


Cheers


----------



## Realist (15 February 2007)

Freeballinginawetsuit said:
			
		

> It is said by many an expert that it is wiser to rent and invest youre capital in the market........ both's good I believe. But you never have control over publicly listed companies future (unless youre a large holder), youre own home you do.
> 
> What is pertinent is controlling one's destiny. At least owning the roof over your head allows a certain amount of this.
> 
> ...





Oh dear oh dear oh dear...    

You have no control over the value of house prices.

You have no control over interest rates.

You can get your house repossesed if you lose your job.

If you own a home and a gang, or some moron moves next door you are screwed, if you own an apartment and your body corporate screws you you can't do anything.

If I change jobs to a new location, or want to move cities, or get moronic neighbours, or want to move somewhere to get Foxtel, or closer to the beach or whatever I am free. No agent fees, no stamp duty, no rates, no water fees, no body corporate fees, no interest rate worries.

My money is in shares, the ASX has more than doubled recently, Sydney house prices have gone down for 3 years now.

Renting is brilliant!!!


----------



## wayneL (15 February 2007)

Freeballinginawetsuit said:
			
		

> What is pertinent is controlling one's destiny. At least owning the roof over your head allows a certain amount of this.



Perhaps too much control.

Missus and I are at the stage where we want to flit about the world a little bit, so we are happy renters ATM. Have lived in three different locations in the last three years and are moving on to the UK and possibly France or Germany after that. Buying a PPOR just does not fit into the current plan

We all laud the Buffetts' of this world for waiting for value purchases, and then advise young people to buy housing at very poor value, by hook or by crook. Doesn't make sense to me.

We did make some IP purchases at value a few years ago, but for the younger people, all I have say is - study economic history.  

*Tech*

I will be sure to point out value when it appears. Actually there is some great value in parts of Germany and their economy is doing very well FWIW. Will be checking it out when I get over there.


----------



## Julia (15 February 2007)

chops_a_must said:
			
		

> I think a lot of the resentment lies in the lack of stability that my generation seem to have to cope with, compared with what most of our parents dealt with. Very little cost for education, no pressure to have the latest gadgets, and seemingly low expectations.




Agreed about the low cost of education, but in the days when this applied only a very small proportion of the population sought a tertiary education anyway.  I worked in my parents' businesses all through my secondary school years and then at weekends after I started a full time job.  Only went to uni much later in life.

You say "no pressure to have the latest gadgets".  For heaven's sake, there is always so called pressure to have what everyone else has.  Doesn't mean you have to succumb and buy whatever it is.

"Low expectations":  again, this is entirely up to the individual.  Don't agree that earlier generations had low expectations.  They were simply realistic enough to appreciate that to get what you wanted you had to work damn hard, usually more than one job, and resist the above "pressure for gadgets" in order to achieve your goal of home ownership, investment property or whatever.  

This constant refrain of how hard it is for young people these days compared to apparently halcyon days of the previous generation is frankly wearing a bit thin.  It's never been easy.  It's all a matter of attitude.  Of seeing opportunities instead of obstacles.  Tech-A summed it up beautifully in his anecdote about the shoe salesmen.  Why do you think it's meant to be easy?

The variety of education and careers these days is fantastic.  There are great opportunities everywhere.  Just look for them and  stop focusing on whatever the negatives are.  They will always be there.  Get over it.


Julia


----------



## nomore4s (15 February 2007)

Julia said:
			
		

> This constant refrain of how hard it is for young people these days compared to apparently halcyon days of the previous generation is frankly wearing a bit thin.  It's never been easy.  It's all a matter of attitude.  Of seeing opportunities instead of obstacles.  Tech-A summed it up beautifully in his anecdote about the shoe salesmen.  Why do you think it's meant to be easy?
> 
> The variety of education and careers these days is fantastic.  There are great opportunities everywhere.  Just look for them and  stop focusing on whatever the negatives are.  They will always be there.  Get over it.
> 
> ...




I agree about the constant complaining Julia, but I actually think the problem is everything is too easy nowadays and people don't want to or have to work hard (Chops, there are exceptions). Credit has never been easier to obtain with little or no deposit, the latest gadgets are easily obtained (cheap & store credit). Our children are brought up getting everything with little or no effort, our schools don't teach responsibility or consequences of actions. And as a result of this when something goes wrong or doesn't fall into place it's always someone elses fault, and instead of improving/fixing whats wrong, people look for an easy out.


----------



## chops_a_must (15 February 2007)

Julia said:
			
		

> "Low expectations":  again, this is entirely up to the individual.  Don't agree that earlier generations had low expectations.  They were simply realistic enough to appreciate that to get what you wanted you had to work damn hard, usually more than one job, and resist the above "pressure for gadgets" in order to achieve your goal of home ownership, investment property or whatever.
> 
> This constant refrain of how hard it is for young people these days compared to apparently halcyon days of the previous generation is frankly wearing a bit thin.  It's never been easy.  It's all a matter of attitude.  Of seeing opportunities instead of obstacles.  Tech-A summed it up beautifully in his anecdote about the shoe salesmen.  Why do you think it's meant to be easy?
> 
> ...



I think you are twisting my argument somewhat here...

It was expected that you do the same thing as your Dad... now it's almost expected that you must do better than your parents...

And from what I've posted above... does it actually look like I have to "get over it"? I'm doing very well for my age, taken an opportunity that is setting me up. I've already stated that this temporary negative time period for young people will result in a positive outcome for people my age eventually. Does it look to you like I am focussing on the negatives?


----------



## Freeballinginawetsuit (15 February 2007)

Realist said:
			
		

> Oh dear oh dear oh dear...
> 
> You have no control over the value of house prices.
> 
> ...





Realist,

Their are many determining factors why individuals purchase a home, my post was relative to a hypothetical scenario of a first homebuyer. An investment decision could be only one reason. The post was trying to illustrate this. 

Its great youre into the sharemarket and have done well, good on ya  . 

Youre obviously not in the property market although their may come a time when your personal circumstances change and you find a need, no doubt with your extensive knowledge and wise investments youll be cashed up to buy a house no drama's. 

In the meantime youre a renter, at the will of the going rental rate/market and this will get sticky shortly. Lots of rich share market/property guru's who have killed the pig and will be uping rents, simple supply/demand scenario as lots of renters around squeezed out of the property market. You could compare this to a very bullish stock with the only difference you have to put a roof over youre head wheras you don't have to buy the stock.

The truth of the matter in Oz is their is rapidly becoming a wealth gap. Property affordabilty is the first indicator. Unlike the past cycles when real estate crashed, this time the wealthy will provide value support and further lock in the wealth gap. The future for for renters is bleak in my opinion.

As arrogant as you are I hope you continue to do well on the stocks although you have given enough indication that this arrogance will probably be youre undoing.



Cheers.


----------



## Freeballinginawetsuit (15 February 2007)

wayneL said:
			
		

> Perhaps too much control.
> 
> Missus and I are at the stage where we want to flit about the world a little bit, so we are happy renters ATM. Have lived in three different locations in the last three years and are moving on to the UK and possibly France or Germany after that. Buying a PPOR just does not fit into the current plan
> 
> ...




Sounds great Wayne, all the best in your travels  .


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## Buster (16 February 2007)

chops_a_must said:
			
		

> I think that's pretty harsh. I started my own business at a time when I was at both University and Tafe.



I'm not completely sure, but I'm tipping Nokia is making a general, sweeeeeeeping, statement.. and one that I agree with on the whole..  As with all general statements, there are exceptions..



			
				chops_a_must said:
			
		

> I think a lot of the resentment lies in the lack of stability that my generation seem to have to cope with



Lack of stability of your generation?? Stability that those generations before yours apparently had?? Stability as in not getting shipped to other countries or to  relatives in the country as children to avoid getting bombed like my parents were during WW2?? [And they were the lucky ones]..  Or, not having to worry about whether or not they'll have a job next week in the economic boom times we are experiencing now as opposed to the industrial unrest and Union movement whilst my parents were struggling to pay thier mortgage and raise thier family??  Etc.. Etc..Are you serious?? 

If there is any resentment, I'd put my money on the fact that those of 'your' generation have never had it so good and are unable to appreciate it..



			
				chops_a_must said:
			
		

> Very little cost for education



and very little education..


			
				chops_a_must said:
			
		

> no pressure to have the latest gadgets



'latest' gadgets few and far between.. and why would someone of your intellect bow to peer group or marketing pressure?? 


			
				chops_a_must said:
			
		

> and seemingly low expectations.



Seemingly low Expectations?? Every generation will have those that take on responsibility (expectations) and those that are simply along for the ride (low expectations)..  
Thankfully it appears you fell in with the right crowd and are comfortable making a go of what is available to you.  You come across as reasonably intelligent in most of your posts I have read..

In regards to property, Swings and Roundabouts mate, swings and roundabouts..  You know that markets work in cycles, keep you money in your pocket if you think there will be correction.. if not hop in now and buy something you can afford, like I had to many moons ago, a crappy unit in a crappy suburb.. that was twenty years ago, which seems like a long time.. but let me tell you I have reaped the rewards since.. When I purchased my crappy unit in a crappy suburb I expected to be paying for the property for the rest of my life.. it cost me just over 80K.. many many sleepless nights wondering if I could afford it, especially as interest rates were considerably higher than they are now, in fact more than double.. only a few years later (after I sold it, but funds not entirely from sale proceeds) I had 80K in the bank and have not looked back since. But you have to make the first move.. 

The hardest part is actually DOING it.. just DO it, it hurts for a while getting used to not having the repayment money, but in a couple of years time when you have sorted the priorities , and had a couple of pay rises it's all good..



			
				chops_a_must said:
			
		

> For me and a lot of my friends... it's a matter of waiting this out... and by the time we are in positions where we can afford property, there will be enough people defaulting for us to come and make a mint on their mistakes.



Again, swings and roundabouts.. If you think the Property Market is topped out, stay clear.  My opinion is that all States barring WA and NT are looking pretty good at the minute. If you are unable to afford a property by your lonesome, why not get together with some of your mates, pool your money and make a mint now.. and make a mint in the future when the rates rise and force (some) people out..

Cheers,

Buster


----------



## Realist (16 February 2007)

Freeballinginawetsuit said:
			
		

> The future for for renters is bleak in my opinion.




You opinion for what it is worth, is incorrect.

Renters are better off than home owners in Sydney and have been for 4 years now. 

Statistics and facts prove this, not just opinions.



> As arrogant as you are I hope you continue to do well on the stocks although you have given enough indication that this arrogance will probably be youre undoing.




Arrogance has nothing to do with it. I'm very careful with my investments, do alot of research, diversify widely, reduce tax and brokerage when possible, and follow proven principles for longterm success.


----------



## Freeballinginawetsuit (16 February 2007)

Realist said:
			
		

> You opinion for what it is worth, is incorrect.
> 
> Renters are better off than home owners in Sydney and have been for 4 years now.
> 
> ...





Yep Realist, the Sydney property market in certain areas is looking attractive ATM. Where do you think WA investment in Property came from, the pundits bailing Sydney   . I am talking about the future property market, not the past market

It's a simple fact that a lot of money is burning holes in pundits pockets ATM itching for a hidey hole to gain a return. Sydney in all likelihood will flip sooner than later. Im certainly looking for value their myself ATM.

WA has flipped and renters will be squeezed, simple....., property investors have killed the pig.......simple and the same crew have parked money in the stockmarket killing the pig..........simple.

Thats the fact over here Realist and you are naive to believe these pundits aren't wise enough to continue to flip the roundabout gaining returns left/right and centre, including parking funds in Sydney property (in the right localities).


----------



## chops_a_must (16 February 2007)

Buster said:
			
		

> Lack of stability of your generation?? Stability that those generations before yours apparently had?? Stability as in not getting shipped to other countries or to  relatives in the country as children to avoid getting bombed like my parents were during WW2?? [And they were the lucky ones]..  Or, not having to worry about whether or not they'll have a job next week in the economic boom times we are experiencing now as opposed to the industrial unrest and Union movement whilst my parents were struggling to pay thier mortgage and raise thier family??  Etc.. Etc..Are you serious??
> 
> If there is any resentment, I'd put my money on the fact that those of 'your' generation have never had it so good and are unable to appreciate it..
> 
> ...



Please don't quote me out of context! If you actually read what I said, "compared to our parents" i.e. baby boomers!!!! How many people had the same job for fourty years in previous times? And how many are likely to have that surety now? None perhaps? I mean, my parents both got jobs when employment was what... at 0%. 

As to lack of education... well. I have a Diploma and three post Diploma qualifications. I am one of only around 10 Vodder therapists in this state...

Plus, while I was doing this... I continued with my double degree and I maintain an average of over 70%.

A lot of what I said I don't think applies to me. I was only offering it as a possible suggestion for the lamentations of the current youthful generation.

And I really resent my lack of intelligence/ education being attacked. Especially considering I have paid my entire way through my training with my hard work. And I really would like you to take that back.

For now, I will continue to be putting more money into my training/ education as it increases my value, and increases my professional status. 

Not all young people are like you seem to think they are... ok?


----------



## nioka (16 February 2007)

chops_a_must said:
			
		

> I think that's pretty harsh. I started my own business at a time when I was at both University and Tafe. A lot of my friends my age or slightly older I would class as workaholics.
> 
> I think a lot of the resentment lies in the lack of stability that my generation seem to have to cope with, compared with what most of our parents dealt with. Very little cost for education, no pressure to have the latest gadgets, and seemingly low expectations. Now every hack of a youngster seems to have to be a genius, earning big bucks or only being educated directly for a wealth related occupation, rather than for enjoyment.




Oh dear me. Stability? My father died suddenly in the middle of the depression leaving my mother with three children. the youngest 6 months old I left school as soon as I was old enough to get a job. I also worked delivering milk twice a day from the age of 9. We didn't cry instability we were too busy. I don't have any resentment so why should you. You have had a chance of a good education. Use it and be happy.


----------



## chops_a_must (16 February 2007)

nioka said:
			
		

> We didn't cry instability we were too busy. I don't have any resentment so why should you. You have had a chance of a good education. Use it and be happy.



Hey. I'm NOT complaining!

And you ARE NOT in the age bracket that I am using as an example. Clear?


----------



## Buster (16 February 2007)

Hey Chops..



			
				chops_a_must said:
			
		

> Please don't quote me out of context! If you actually read what I said, "compared to our parents" i.e. baby boomers!!!!



Ahhh, I thought you said _OUR_ pararents.. as in whoever was reading the posts parents blah bla bla ba blah.. Oh wait, you did!! I guess I should have read it simply as _YOUR_ parents.. Seems others made the same mistake as me.. good to see it's all been cleared up..



			
				chops_a_must said:
			
		

> How many people had the same job for fourty years in previous times?



Lots.. and there is good reason.. the lack of 'Good' (but apparently low cost) education for the masses, and very little in the way of 'Personal Development' or 'Self Improvement' offered by the employers then as opposed to the plethora offered by employers these days.



			
				chops_a_must said:
			
		

> And how many are likely to have that surety now? None perhaps?



Surety?? Again, Lots.. Will people hang about the same job these days for longer than 6 -7 years, nope..  Thats the trend these days, and it's purely because of the PD programs offered by employers.. the employee takes what he/she can get, a few extra ticks in the box and it's time to move onto greener fields.  That's just the way it is these days, but if you wanted to hang about the same workshop/office/retail job for 40 years I'd tip that you could..



			
				chops_a_must said:
			
		

> And I really resent my lack of intelligence/ education being attacked. Especially considering I have paid my entire way through my training with my hard work. And I really would like you to take that back.




I never attacked your lack of intelligence, I like your lack of intelligence..   Sorry, couldn't resist, your first line made me laugh.. Seriously though.. I have reread my post and cannot for the life of me figure out what this quote is about?? I didn't slag you off as a knucklehead.. Did I?? 



			
				chops_a_must said:
			
		

> For now, I will continue to be putting more money into my training/ education as it increases my value, and increases my professional status.



And more power to you Chops.. Keep it up..



			
				chops_a_must said:
			
		

> Not all young people are like you seem to think they are... ok?



I don't think young people are anything just quietly, I just made a statement that if there is anything that is to be resented it's that the younger generation don't know how good they've got it.. This BTW would be true of _Every_ generation I would suggest.  Else the ol' Monty Python 'shoebox in middle of road' skit wouldn't be nearly as funny, would it..   

[On Topic] Anyone who thinks that rents are not too low obviously does not own an Investment property here in Perth.. $200 - 300 a week for a $500K property is _NOT_ a good return.. IMHO anyway..  

Cheers,

Buster


----------



## chops_a_must (16 February 2007)

Buster said:
			
		

> I don't think young people are anything just quietly



Really?


			
				Buster said:
			
		

> I'm not completely sure, but I'm tipping Nokia is making a general, sweeeeeeeping, statement.. and one that I agree with on the whole.



Maybe you are getting senile in your old age?


----------



## nioka (16 February 2007)

chops_a_must said:
			
		

> Hey. I'm NOT complaining!
> 
> And you ARE NOT in the age bracket that I am using as an example. Clear?



Never intended my post to be directed at you individually. My comments are general and result from reading a series of posts saying rents are too high, too low etc, and house prices are too high,renting is better than buying etc. The theme is usually" we want more for less" and this is on a forum where everyone wants to get rich quick through investing. It is a great feeling to give someone something for nothing but the feeling disappears if the someone expects to get it for nothing.


----------



## krisbarry (16 February 2007)

This thread is starting to get really filfthy, members attacking other members, just like all the other property threads.

This one has gone to the dogs, yet again.


MODERATORS PLEASE CLOSE THIS THREAD DOWN!


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## wayneL (16 February 2007)

Buster said:
			
		

> [On Topic] Anyone who thinks that rents are not too low obviously does not own an Investment property here in Perth.. $200 - 300 a week for a $500K property is _NOT_ a good return.. IMHO anyway..
> 
> Cheers,
> 
> Buster




Combined with a host of other indicators of value, it shows that houses are fundamentally overpriced, rather than rents are too low.


----------



## Joe Blow (16 February 2007)

Stop_the_clock said:
			
		

> MODERATORS PLEASE CLOSE THIS THREAD DOWN!




Bah! I don't see anything worth closing the thread over! Settle down Kris.

Nothing wrong with things getting a little heated just so long as we don't start abusing each other. 

Lets keep it all in perspective, shall we?


----------



## chops_a_must (16 February 2007)

nioka said:
			
		

> Never intended my post to be directed at you individually. My comments are general and result from reading a series of posts saying rents are too high, too low etc, and house prices are too high,renting is better than buying etc. The theme is usually" we want more for less" and this is on a forum where everyone wants to get rich quick through investing. It is a great feeling to give someone something for nothing but the feeling disappears if the someone expects to get it for nothing.



Funny how you criticise others for wanting something for nothing yet does this not seem ironic when it comes to asking for more rent?


----------



## nioka (16 February 2007)

chops_a_must said:
			
		

> Funny how you criticise others for wanting something for nothing yet does this not seem ironic when it comes to asking for more rent?



Only if a higher rent was not justified. A rental property like everything else material is usually priced at a level which is set by the laws of supply and demand.  Ask too much and you don't get a sale. Ask too little and you don't have enough product. Why should it be any different to the price of shares. You often are seen to quote a share which is a good buy because the price will rise. Shares are some peoples investment, rental properties are others. Do I have a valid point or not?


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## Wysiwyg (16 February 2007)

I come from an industrial town which has, over 40 years,had continuous expansion and especially now.Big companies,jobs,and more workers/people needing accomadation.Suburbia is clearing places I used to ride my dirt bike on.

Houses with a view of the industrialisation are going for half to a million.I should have bought years ago but I`m not real smart.

On the subject of rents...they are ALWAYS in line with what you want to pay.


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## chops_a_must (16 February 2007)

nioka said:
			
		

> Only if a higher rent was not justified.



The problem that I see, is a lot of people can't actually handle a rising in rents. Wages simply haven't risen at the same rate as the cost of living has. 

So against the "value" of property, rents are low. But against other factors they are rather high. And eventually this costs the property market, and the wider economy. People have to reduce spending which affects retailers, it also inhibits people's ability to save and stops new buyers entering the property market. And as in the stock market, when buyers dry up, prices drop.

Until we see some large real wage growth, rent value against property value will probably remain low. It's not simply a matter of supply and demand but willingness to pay and affordability issues as well.

And lets face it, the majority of renters are amongst the more disadvantaged in the community economically, so their ability to absorb rent increases without serious consequences somewhere else is severely limited.


----------



## Freeballinginawetsuit (16 February 2007)

Wysiwyg said:
			
		

> On the subject of rents...they are ALWAYS in line with what you want to pay.




True, if youre not willing to pay the market rate, you can always pitch a tent or live in youre car.........and don't be naive enough to think that is not occuring.


----------



## Wysiwyg (16 February 2007)

Freeballinginawetsuit said:
			
		

> True, if youre not willing to pay the market rate, you can always pitch a tent or live in youre car.........and don't be naive enough to think that is not occuring.




People can choose a more humble,less expensive abode without going to the extreme of tents and caravaning. Moving away from the HOT spots can save one several dollars.


----------



## TjamesX (16 February 2007)

Buster said:
			
		

> [On Topic] Anyone who thinks that rents are not too low obviously does not own an Investment property here in Perth.. $200 - 300 a week for a $500K property is _NOT_ a good return.. IMHO anyway..
> 
> Cheers,
> 
> Buster




Totally agree its not a good return, so the question then has to be asked - why pay $500k for it??

There is no written rule that says investors are entitled to make money just because they decide to invest

Opportunites are everywhere.... they're just not there for every position in every market (some win some lose)

What is the trend in rents?
Why will rents outpace inflation (and wages)?
If they do why will this not put upward pressure on inflation and interest rates?
What is the current trend for inflation?
What is the current trend for interest rates?
What is the current trend for prices?
What happened after the last property boom?
Will this time be any different?

This is obviously looking at it from an investors point of view, but for home owners IMO in the current climate there is no 'rush' to buy property - but I do believe when you can afford it is a good time to buy.

I have a friend in Sydney who in a rush to buy in 2003/04 went halves with another person to buy a townhouse.... their friendship has now soured and they are having to sell in the current market climate... not a great result for anyone

Rents aren't too low - but that doesn't mean they won't go up  :


----------



## tech/a (17 February 2007)

For PROFESSIONAL property investors none of this is relevant.



> What is the trend in rents?
> Why will rents outpace inflation (and wages)?
> If they do why will this not put upward pressure on inflation and interest rates?
> What is the current trend for inflation?
> ...




Your all looking at this from the laymans retail veiw.

*All that matters for the pro is the bottomline figures on a developement.*

I have one in Council for approvals now.
Here are the numbers.
2600 square meters of land. ($525,000) 7----1 and 2 bed apartments.
Av size 160 square meters. Construction costs $1100 per square meter.
Or $176,000 each.+ Land cost $75,000 each---- Sell $365,000 each.
Approx $800k in the developement.

2 now sold off plan (Awaiting approval for deposits).

3 will be held as freehold (Capital equity used for future developements).
Rent will be approx $300/week. At no cost other than out goings and cashflow is positive.

*Pros* are ALWAYS positively geared regardless of prices,interest rates,rents,inflation---blah blah. 

We do one a year looking to up it to 2 if we can find suitable land.


----------



## moses (17 February 2007)

chops_a_must said:
			
		

> The problem that I see, is a lot of people can't actually handle a rising in rents. Wages simply haven't risen at the same rate as the cost of living has.



But a lot of people can. That is why many would be tennants are already bidding for properties and paying rent well above so called "market value".


> Until we see some large real wage growth, rent value against property value will probably remain low. It's not simply a matter of supply and demand but willingness to pay and affordability issues as well.



Wishful thinking, not reality. You don't have to like it, but reality will win.


> And lets face it, the majority of renters are amongst the more disadvantaged in the community economically, so their ability to absorb rent increases without serious consequences somewhere else is severely limited.



That argument only means that there will be serious consequences.

Go to New York and see what people are paying to live in, and you may recalibrate just how far tenants can be pushed.


----------



## wayneL (17 February 2007)

moses said:
			
		

> But a lot of people can. That is why many would be tennants are already bidding for properties and paying rent well above so called "market value".




Tenant will bid up to secure a place. Market power will ebb and flow between tenants and LLs. This will swap back at some stage.



			
				moses said:
			
		

> ... reality will win.



Indeed. The problem is in speculative booms people realize that too late.
That argument only means that there will be serious consequences.



			
				moses said:
			
		

> Go to New York and see what people are paying to live in, and you may recalibrate just how far tenants can be pushed.



LOL. New York city wages are waaaaaayyyyyyyyyyyy higher than Aussie wages and NY is one of the biggest cities in the world... not directly comparable in any way shape or form. Go upstate NY and you will see an entirely different story.

As an aside, for some interesting for sale prices in upstate NY, look here - http://www.realtor.com/FindHome/Hom...bath=0&mnsqft=0&ss_mitm=n/a&sid=08114363C68AC LOL


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## moses (17 February 2007)

wayneL said:
			
		

> LOL. New York city wages are waaaaaayyyyyyyyyyyy higher than Aussie wages and NY is one of the biggest cities in the world... not directly comparable in any way shape or form.



In that sense, yes, but I wasn't really trying to compare.

My point was simply that tenants aren't anywhere near breaking point; living conditions can get much much worse and rents can go much much higher. And for some, wages can go much higher.

Not pleasant for tenants though I admit. 

My tenants are elderly and wonderful, so I haven't raised the rent for too long...but I doubt if it can last. The moment a good tenant moves out the rent will always go up sharply, and anyone with less than ideal tenants has no motivation for keeping the rents down atm.


----------



## wayneL (17 February 2007)

Buffalo NY - $675 per month

Thats $155 per week


----------



## wayneL (17 February 2007)

A bit more upmarket in a nice area - $2600 per month

$600 week


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## wayneL (17 February 2007)

Actually NYC is not as exy as I thought:

http://rentals.realtor.com/FindHome...rk&Image1.y=12&primaryZp=&mnbath=0&areaid=264


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## chops_a_must (19 February 2007)

moses said:
			
		

> That argument only means that there will be serious consequences.



Yep. Overheard on the news tonight that workers will not come to Perth because rents are ridiculously high. No new skilled workers = top in economic growth.


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## tech/a (20 February 2007)

> A bit more upmarket in a nice area - $2600 per month *US*




AU$3400/mth---$785/week.

Thats about right with comparable homes in Stirling/Mt Barker/Crafers in Adelaide.

Comparable home 30 miles out of London was around 6000 pounds a Month
Or $15,000.

In The UK its not un common to have 6 sharing.

You think our rents are to low-----??


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## tech/a (20 February 2007)

chops_a_must said:
			
		

> Yep. Overheard on the news tonight that workers will not come to Perth because rents are ridiculously high. No new skilled workers = top in economic growth.




Mate in Perth building Industry paying his labourers $24/hr 50 hr weeks 
In Adelaide we pay $18 /hr same hrs.
Take a skilled operator.Perth $30/hr Adelaide $23/hr
At $7/hr diff or $350/week. Even $ 150/week more in rents not a problem.


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## wayneL (20 February 2007)

tech/a said:
			
		

> AU$3400/mth---$785/week.



You cannot use exchange rates as a comparison. They earn the same in USD as we do in AUD if not a helluva lot more. (unless unskilled, then wages crap)



			
				tech/a said:
			
		

> Comparable home 30 miles out of London was around 6000 pounds a Month
> Or $15,000.




You cannot compare 30 miles from London to Buffalo NY. You would have to use Nth Wales or the NE England as a comparison. #1950 would get you something like this is a seriously mucky muck area:







This one overlooks golf course etc.

This one is 1800:


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## wayneL (20 February 2007)

I have a 4 x 2 detached in Somerset, not quite as flash as those above, but very large by English standards. Rents for 1200 pounds.


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## wayneL (20 February 2007)

This one is 16,000 pounds per month LOL






Sunninghill Berkshire... Very highbrow


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## wayneL (20 February 2007)

Tech,

here's one closer to your 6k close to London... Near Windsor Castle

http://www.rightmove.co.uk/viewdetails-5836341.rsp?pa_n=9&tr_t=rent






It is quite a few notches above the Buffalo NY pile of bricks.



> An exciting property, in a fantastic location, with numerous features, including indoor pool, roof terrace, conservatory, triple garage, 7 bedrooms and 7 bathrooms and expansive private grounds
> leading to the Windsor Great Park.


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## chops_a_must (20 February 2007)

tech/a said:
			
		

> Mate in Perth building Industry paying his labourers $24/hr 50 hr weeks
> In Adelaide we pay $18 /hr same hrs.
> Take a skilled operator.Perth $30/hr Adelaide $23/hr
> At $7/hr diff or $350/week. Even $ 150/week more in rents not a problem.



We are talking, in some cases, $600 p/wk for basic rentals.

I'm just writing what I heard...


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## Noskcid (20 February 2007)

tech/a said:
			
		

> Mate in Perth building Industry paying his labourers $24/hr 50 hr weeks
> In Adelaide we pay $18 /hr same hrs.
> Take a skilled operator.Perth $30/hr Adelaide $23/hr
> At $7/hr diff or $350/week. Even $ 150/week more in rents not a problem.




Well according to the MBA which is what the company I work at pays, its $15.38 for a normal labourer, but obviously thats just the base rate. Also a skilled operator would be paid according to what he was capable could range from $23 - $28. Then on top of that you got other rates for specialised trades. (Adelaide)

But yeah I agree with a $150 more a week rental is not a problem, it really depends in what state. Generally the higher the rent = higher living standards which means people just get paid for for the same job. I could move to sydney and get an extra $20k easy for the job im doing now, but that would just go to living and I'll end up not saving it anyway.

A mate just went down to work in Sydney, hes getting an extra $20k but $10k is going back into rent and the rest into travel and other living expenses, as he lives an hr from work, if he was to live closer he'll prob spend more than $20k extra for rent. 

In Sydney you be looking at the 500 - 800k mark for appartments in glebe, for the same in adelaide say north adelaide its around 400 - 600k mark for a same appartment, in a slightly better suburb (distance to the city is pretty much the same). Thats 200k Diff!!!

If you bring interest rates in then its a different story, ill come back to that later, kindda busy atm!!

P.S. From what I heard so don't quote me on this, the living cost in Sydney is higher than New York???? and one of the highest in the world..


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## numbercruncher (6 March 2007)

From an investment point of view i agree rents are to Low compared to property values!

But the said propertys are way overvalued and i cant wait for them to crash! (sounds like this has started already in the US)


Only way to buy a house now a days, is to rent one and purchase an investment property for the negative gearing benifits, get together with a mate or family member and buy a house near each other and rent it off each other!!


Crazy crazy world.


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## Kimosabi (7 March 2007)

Well, there was finally... a piece on US Sub-Prime housing on Lateline Business Tonight.  They had some stats on Aussie Sub-Prime foreclosures currently running at approx 5%.

US Subprime Defaults are currently running at 20% but theres nothing to worry about    

If you want to watch the repeat, it's on ABC2 at 7am tomorrow morning.


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## bvbfan (7 March 2007)

Or on the web here at the Lateline Business website


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## Go Nuke (15 March 2007)

nioka said:
			
		

> Work longer hours or get a second part time job if that is the only way. A lot of us did that to get where we are now.
> If you don't then you are either a winger or a loser. The only one who can help is yourself.
> I once gave a job to an ex POW (Burma Railway). He lived 10km away. I asked him how he was getting to work after he had been there a week. His answer was walking. He also was cleaning at a hospitol at night and said he would be able to buy a car in a few months time.
> And you are complaining.  Please excuse me if I seem cranky but you young ones these days seem to want more than you are prepared to give.




Gee....nothing personal there...Im either a winger or a loser!
Ive done my hard yards as a Boilermaker...so i guess that doesn't make me a loser.
You know..real work..not that pen pushing crap.

We only get about $23/hr here in Brisbane for that. Queensland has some of the countries lowest wages along with Tas and S.A 
Its all relative. People in Perth are earnign big dollars with the mining boom..hence the high rent. You just cant do that to people here in Queensland or expect to get the same rental return.

Something will have to give. Im sure that will happen before all us low/middle income workers go out and work 2 jobs... Kiss the family time goodbye. (Not that i have a family...couldn't afford 1..hence Australia's declining birth rate.)

Something just mentioned in the news the other day was that it takes approx $93k to buy an average house here in brisbane.
Hmmm...come to think of it....I dont know many people even with a combined income of $92k!
Thats not winging btw..that a fact.

To be honest..im pretty pissed at your comments. Perhaps a typical white collar worker from down south's response.


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## chops_a_must (15 March 2007)

Go Nuke said:
			
		

> We only get about $23/hr here in Brisbane for that. Queensland has some of the countries lowest wages along with Tas and S.A
> Its all relative. People in Perth are earnign big dollars with the mining boom..hence the high rent. You just cant do that to people here in Queensland or expect to get the same rental return.



Not really.

The only jobs in Perth that are paying more now thanks to the boom are Engineering type jobs. Everyone else is being paid much the same as what they were before and that's the problem. The boom hasn't really helped anyone apart from those directly employed by the industry.


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## Freeballinginawetsuit (15 March 2007)

chops_a_must said:
			
		

> Not really.
> 
> The only jobs in Perth that are paying more now thanks to the boom are Engineering type jobs. Everyone else is being paid much the same as what they were before and that's the problem. The boom hasn't really helped anyone apart from those directly employed by the industry.




Thats not correct. If youre an employer looking for quality staff, you have to pay appreciated rates to get them.....if you can at all. 

If you have skills or a work ethic that employers seek (and their are plenty seeking ATM) youre in a good market to be remunerated accordingly.....simple supply/demand scenario.

Wages haven't increased for the Drones not prepared to get out of their box and chase the work....most of those are happy in their box, if employed at all!. What a waste of an opportunity.


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## chops_a_must (15 March 2007)

Freeballinginawetsuit said:
			
		

> Thats not correct. If youre an employer looking for quality staff, you have to pay appreciated rates to get them.....if you can at all.
> 
> If you have skills or a work ethic that employers seek (and their are plenty seeking ATM) youre in a good market to be remunerated accordingly.....simple supply/demand scenario.
> 
> Wages haven't increased for the Drones not prepared to get out of their box and chase the work....most of those are happy in their box, if employed at all!. What a waste of an opportunity.



But once again, it depends on what sector you are in. Public servants for instance, have had an abysmal time of it. Wages in my profession and associated areas haven't moved either.

And the problem is, if you don't have a skill set the employers want at the moment, bad luck. They're all chasing exactly the same people in a very narrow range of expertise.


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## wayneL (15 March 2007)

chops_a_must said:
			
		

> But once again, it depends on what sector you are in. Public servants for instance, have had an abysmal time of it. Wages in my profession and associated areas haven't moved either.
> 
> And the problem is, if you don't have a skill set the employers want at the moment, bad luck. They're all chasing exactly the same people in a very narrow range of expertise.



Agree

I have a friend, a Phd with a very crucial and responsible position in biological safety, who would earn way less than a chippy or truck driver or something. Very little opportunity outside her chosen field.

I'm so glad to be a self unemployed trader (soon to join the ranks of the working masses  ). I'd hate to be trying to earn a crust with my particular skill sets.


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## Freeballinginawetsuit (15 March 2007)

chops_a_must said:
			
		

> But once again, it depends on what sector you are in. Public servants for instance, have had an abysmal time of it. Wages in my profession and associated areas haven't moved either.
> 
> And the problem is, if you don't have a skill set the employers want at the moment, bad luck. They're all chasing exactly the same people in a very narrow range of expertise.




A simple basic work ethic has a place in the market ATM, obviously skilled labour is sought after, but their are plenty of T/A or manual work for those that are prepared to grasp an opportunity.

Problem is the work ethic and anyone worth some salt is snapped up.....Quick.

A simple call to an employment agency such as PVS etc will reveal whats left dosen't want to work, or is basically unemployable.

Probably are many in other mediums that are lowly paid, maybe they want to be highly paid but aren't willing to move outside the comfort zone .


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## Freeballinginawetsuit (15 March 2007)

wayneL said:
			
		

> Agree
> 
> I have a friend, a Phd with a very crucial and responsible position in biological safety, who would earn way less than a chippy or truck driver or something. Very little opportunity outside her chosen field.
> 
> I'm so glad to be a self unemployed trader (soon to join the ranks of the working masses  ). I'd hate to be trying to earn a crust with my particular skill sets.




Well I've got a mate who has a degree as well, but now he's at Murin Murin as the H&S staffy on FIFO and raping it in. Whats youre point?.....you can't always have youre cake and eat it!.

Sure their not really his skills but who cares. Its a bit like the arguement of some wheat and sheep farmers,making no money but not prepared to change their ways......., doh.


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## Kauri (15 March 2007)

Freeballinginawetsuit said:
			
		

> A simple basic work ethic has a place in the market ATM, obviously skilled labour is sought after, but their are plenty of T/A or manual work for those that are prepared to grasp an opportunity.
> 
> Problem is the work ethic and anyone worth some salt is snapped up.....Quick.
> 
> ...




   Spot on...


*WA unemployment stays at record low
*

_15th March 2007, 13:45 WST

_

Premier Alan Carpenter declared that WA has reached full employment and its economy is leading the country after the latest figures showed the State's unemployment rate has remained at a record low.



Australian Bureau of Statistics figures show WA has created more than 130,000 new jobs since 2003 when the Labor government set a target of 125,000 new jobs in five years, Mr Carpenter said.

"This is a direct reflection of the state's strong economy, and a testament to the government's ability to deliver improved opportunities for West Australians," the premier said.

The latest figures showed WA's unemployment rate remained at three per cent for the second month in a row - the lowest on record since the ABS commenced the Labour Force Series in 1978.

"WA has almost certainly reached full employment and it is now conceivable the unemployment rate could crash through the three per cent barrier - something that was unthinkable just a few years ago," Mr Carpenter said.

AAP


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## wayneL (15 March 2007)

Freeballinginawetsuit said:
			
		

> A simple basic work ethic has a place in the market ATM, obviously skilled labour is sought after, but their are plenty of T/A or manual work for those that are prepared to grasp an opportunity.
> 
> Problem is the work ethic and anyone worth some salt is snapped up.....Quick.
> 
> ...



In principle I strongly agree, in the real world, things *can* be very different as I detailed in the above post. In the real world, folks may have extraneous circumstances which can prevent them moving to greener pastures. (family considerations, intellect, physicality, race, disability etc etc etc)

For instance, I was injured in my last occupation that makes any sort of real physical work impossible, and I've always worked in very physical roles. I'm just lucky enough that my brain works in a way that makes other things possible.


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## wayneL (15 March 2007)

Freeballinginawetsuit said:
			
		

> Well I've got a mate who has a degree as well, but now he's at Murin Murin as the H&S staffy on FIFO and raping it in. Whats youre point?.....you can't always have youre cake and eat it!.
> 
> Sure their not really his skills but who cares. Its a bit like the arguement of some wheat and sheep farmers,making no money but not prepared to change their ways......., doh.



Freeball,

I used to think like you. Now I am more experienced. That's not a put down in any way, but you see things as you go along.

Don't be too hard hearted because you're doing well.   

Cheers


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## Freeballinginawetsuit (15 March 2007)

wayneL said:
			
		

> In principle I strongly agree, in the real world, things *can* be very different as I detailed in the above post. In the real world, folks may have extraneous circumstances which can prevent them moving to greener pastures. (family considerations, intellect, physicality, race, disability etc etc etc)
> 
> For instance, I was injured in my last occupation that makes any sort of real physical work impossible, and I've always worked in very physical roles. I'm just lucky enough that my brain works in a way that makes other things possible.




Well their are probably many fields that would be just up youre alley, or maybe financially youre well balanced....the point was based at those who arent financially balanced!.

Disability certainly.......as for the rest they can be overcome if you have a desire and display a will. 

The demands their for those who have something to offer........even the most simpliest of offerings. Problem is some aren't even capable of that!.


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## Smurf1976 (15 March 2007)

coyotte said:
			
		

> Could the first one 1988 have had anything to do with Bob Hawke's betrayal to the union movement, hence setting the scence for lower wages and conditions for employees ---- hence lower building costs -- with lower relative building costs the only way out was increased land values.
> 
> The second one 200? when these changes started to take effect, with falling relative building costs the only way out was again to increase land values.
> 
> ...



Agreed about what happens when wealth becomes too concentrated. I think it was Henry Ford who noted that the best way to boost his (at that time) new business manufacturing cars was to double the pay of every worker. That way the workers could all afford to buy one of the company's cars and in doing so created pressure on other employers to also raise wages such that their employees could also afford to buy one. I would be hard to argue that his strategy was anything other than brilliantly successful.

As for housing, I'd like to know why, exactly, the building industry (land clearing through to house completion) has collectively become so much LESS efficient in recent years.

A decade ago 3 years wages bought a generic house in the suburbs. Something that, in the outer suburbs at least, can be pumped out just like cars out of a factory. And yet today it takes 6 - 7 years wages to buy an idendical house.

Someone, somewhere, seems to be making an incredibly large profit out of all of this. Nothing "wrong" with that but I'd be interested to know why, exactly, the cost of building has increased so much more than the price of virtually anything else. 

I suspect all those "economic rationalism" outsourcings and privatisations of the 1990's has a lot to do with it. Government and the bigger companies traditionally turned out thousands of apprentices nationally each year. But it just doesn't happen on that scale anymore with the focus on minimising cost no matter what the consequences. Hence not enough builders and other tradespeople and far higher prices for their work.  

I find it rather absurd that building costs more than double and few say anything about it. And yet someone works out how to save 5% on the cost of anything else and the politicans come forth with a radical plan to implement it without delay. 

It's seen as so important to save maybe $500 on airfares or $200 a year on phone bills that we've radically restructured entire industries to achieve it. Petrol costs perhaps $2000 a year and we've had dozens of inquiries into the price of petrol. We've got the ACCC running around threatening anyone who even thinks of ripping off the consumer. 

And yet the cost of building a house goes up 100% more than official inflation, costing consumers far more than they'd ever spend on airfares, phone bills and petrol combined, and nobody even bothers to find out why it has increased so much. Something ain't right here...


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## Smurf1976 (15 March 2007)

Freeballinginawetsuit said:
			
		

> If you have skills or a work ethic that employers seek (and their are plenty seeking ATM) youre in a good market to be remunerated accordingly.....simple supply/demand scenario.



One thing I've noticed over the past couple of years is a marked decline in the general willingness of people to take on additional work, for example paid overtime. 

Why? Because only those old enough to remember past recessions or with an interest in economics have even the slightest concern that maybe, just maybe, they ought to be making $ while the economic sun is shining. 

Everywhere you go, most believe the boom will go on forever and are less motivated to work as a consequence of that view.


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## robandcoll (15 March 2007)

It does really get down to market/demand/ and ofcourse the last one, up selling byReal Institutes. Got out of property about 6 months ago (Perth). The upsell and was ridiculous. For a 4 x 2 70Kms out of Perth $500,000. Apartments in that area now trying to sell for $1.2 million. ( They arent though) This week adverts in The Western Australian News, the WA Real Estate Institute stating the lack of land is causing this spike and they are blaming the government. (There is plenty of blocks available) People believe what they read.  There will be alot of poeple in WA who will get hurt over the next year or 2 because they have brought on a frenzy.

I am the vulture


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## Julia (15 March 2007)

wayneL said:
			
		

> Don't be too hard hearted because you're doing well.
> 
> Cheers




That's a really good reminder to us all.  When *we*  are doing OK, we can so easily assume a sense of superiority and be critical of others who are still finding their way.

Thanks, Wayne.

Julia


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## Freeballinginawetsuit (15 March 2007)

Julia said:
			
		

> That's a really good reminder to us all. When *we* are doing OK, we can so easily assume a sense of superiority and be critical of others who are still finding their way.
> 
> Thanks, Wayne.
> 
> Julia




I relate to youre musings Julia, but the fact of the matter is I have hung my head out a few times this year and been stung by those finding their way.

"Like subbing a guys wages, only to find out he hasn't been at work for a week."

Excuse me while I go back to eating some peaches and cream .


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## dubiousinfo (16 March 2007)

Smurf1976 said:
			
		

> Agreed about what happens when wealth becomes too concentrated. I think it was Henry Ford who noted that the best way to boost his (at that time) new business manufacturing cars was to double the pay of every worker. That way the workers could all afford to buy one of the company's cars and in doing so created pressure on other employers to also raise wages such that their employees could also afford to buy one. I would be hard to argue that his strategy was anything other than brilliantly successful.
> 
> As for housing, I'd like to know why, exactly, the building industry (land clearing through to house completion) has collectively become so much LESS efficient in recent years.
> 
> ...




The actual cost of building hasn't increased that much above inflation and part of that increase is due to increased insurance and regulation compliance costs.

Wages within the industry have tracked inflation and builders margins have not moved significantly. In percentage terms they are similar to what they have traditionally been.

The biggest increase in the cost of housing is the land content.


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## wayneL (16 March 2007)

Freeballinginawetsuit said:
			
		

> I relate to youre musings Julia, but the fact of the matter is I have hung my head out a few times this year and been stung by those finding their way.
> 
> "Like subbing a guys wages, only to find out he hasn't been at work for a week."
> 
> Excuse me while I go back to eating some peaches and cream .



Several times in your posts you allude to your success in life/wealth. It seems to be important to you that people know this. It's probably somewhat important to most of us, but I think it says something. I have suggested books on this topic elsewhere, but I digress...

I don't think a lack of moral fibre is exclusive to the "lower classes". (a term I despise, but can't think of a different term) I have been privy to some of the most diabolical financial immorality you can even think of from folks who "have made it"

Lack of success does not imply virtue in the same way that success does not imply lack of virtue. (and visa versa) Trust must be earned in any station in life... another lesson one learns as they go along.

Excuse me while I go back to my Lao Tzu.



> The truth isn't flashy.
> Flashy words aren't true.
> 
> Educated people
> ...




****notes part on arguing


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## Freeballinginawetsuit (16 March 2007)

wayneL said:
			
		

> Several times in your posts you allude to your success in life/wealth. It seems to be important to you that people know this. It's probably somewhat important to most of us, but I think it says something. I have suggested books on this topic elsewhere, but I digress...
> 
> 
> 
> ...


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## wayneL (16 March 2007)

Freeballinginawetsuit said:
			
		

> ...comments .




_Those who know, don't talk.
Those who talk, don't know.

Shut your mouth.
Be still. Relax.
Let go of your worries.
Stay out of the spotlight.
Be at one with the world
and get right with Tao.

If you get right with Tao,
you won't be worried
about praise or scorn,
about winning or losing,
about honor or disgrace.
That's the way to be. _

I'm shutting up now. Good night


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## numbercruncher (16 March 2007)

dubiousinfo said:
			
		

> The actual cost of building hasn't increased that much above inflation and part of that increase is due to increased insurance and regulation compliance costs.
> 
> Wages within the industry have tracked inflation and builders margins have not moved significantly. In percentage terms they are similar to what they have traditionally been.
> 
> The biggest increase in the cost of housing is the land content.





Its true the biggest cost increase has been land due to money grabbin state governments.

I got a house quote to build in 2002 100k the same place in 2006 150k, thats one hella inflation! Sure builders work on about the same margin, but i know what price id rather have the 20pc margin on!


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## juddy (16 March 2007)

Freeballinginawetsuit said:
			
		

> Well I've got a mate who has a degree as well, but now he's at Murin Murin as the H&S staffy on FIFO and raping it in. Whats youre point?.....you can't always have youre cake and eat it!.
> 
> Sure their not really his skills but who cares. Its a bit like the arguement of some wheat and sheep farmers,making no money but not prepared to change their ways......., doh.





Though I respect your comments FB, it is fortunate that not all people think like this, especially those in the 'caring' professions. Most (not all) police, teacher, nurse 'drones' work in their fields for the betterment of society, not to become wealthy. What would happen if they all chased the $100k mining jobs? Chaos?

The sacrifice these people make allow others to chase those big bucks and still come home to a house with their possessions still intact and healthy, educated children.

I appreciate the role these people play and are thankful they stay there.


----------



## Freeballinginawetsuit (16 March 2007)

juddy said:
			
		

> Though I respect your comments FB, it is fortunate that not all people think like this, especially those in the 'caring' professions. Most (not all) police, teacher, nurse 'drones' work in their fields for the betterment of society, not to become wealthy. What would happen if they all chased the $100k mining jobs? Chaos?
> 
> The sacrifice these people make allow others to chase those big bucks and still come home to a house with their possessions still intact and healthy, educated children.
> 
> I appreciate the role these people play and are thankful they stay there.




No arguements here Juddy I appreciate the roles they play.

But were do you think the Mining royalties/PAYE/Company taxes go ATM thats propping up our economy and real estate value in West Oz . Its a two way street.

Those proffesions you stated are most essential, but gone are the days when they supported a family on a single income, let alone pay off the family mortgage. Again what props up the childcare levy thats necissitated by the young families earning the two incomes trying to get a start. Certainly not their professions.You could go on and on.

The truth is we all want a bit of the pie, but its not big enough for everyone and the scraps are running out.

So were does an 18 year old go straight out of school to get whats left, the warm and fuzzy profession and 4 years of uni prior. 
Or go wash some dishes for a couple of years up North for a kick start and do the warm and fuzzy later.

There are opportunities too still get ahead, just short term sacrifices to be made to get their. Wether thier made is entirely up to the individual.

Anyway no more bashing please...I'm done on this one .


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## Go Nuke (19 March 2007)

Smurf1976 said:
			
		

> One thing I've noticed over the past couple of years is a marked decline in the general willingness of people to take on additional work, for example paid overtime.
> 
> Why? Because only those old enough to remember past recessions or with an interest in economics have even the slightest concern that maybe, just maybe, they ought to be making $ while the economic sun is shining.
> 
> Everywhere you go, most believe the boom will go on forever and are less motivated to work as a consequence of that view.




I thought it was the tax that stopped people from working excessive paid overtime.
Tax will really screw u over if your not careful. And please dont say that they should fork out more dollars for a good accountant
Though i do think your comment on recession etc is true.

Ive thought about going to the mines...it might take its toll doing Fly in, Fly out work on my relationship though. So to some extent I have to (begrudgingly) agree with FB. Life can be what i make it.
I have to give up some of my "bad habits" before i can go to the mines anyway


----------

