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The future of Australian property prices

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I went to an auction on the weekend and the big green st george dragon rocked up and knocked 10k off the purchase price courtesy of the bank.

i thought that was pretty cool
 
10K it is called bait just like 1080 is to pigs.
 
Yep, you'd have thought so. And he could have explained away the non provision of security screens in the final specification as an oversight.
He clearly decided he preferred clients who wouldn't be too vigilant about costs.

Looking back there were other clues e.g. changes I made which reduced the cost (no dishwasher, less sophisticated oven etc) for which I asked for written note of difference between the original and the new version which never appeared. Presumably he thought these credits would just get overlooked in the scheme of time.

And yes, most builders are looking for work. He's in his late 50's and about ready to retire, apparently quite well off, so probably can choose his sucker clients.
Glad I didn't in the event become one of them.
 
Julia, do you mind revealing the total cost of the project home you were purchasing?
 
Top end caught flat-footed as property slump worsens

Chris Vedelago

May 6, 2012


Illustration: Matt Golding

Melbourne's rich and famous are facing losses of up to 25 per cent in the luxury apartment market as the top-end property slump worsens.
Prestige areas, including Toorak, Brighton, East Melbourne, Southbank and St Kilda Road, where hundreds of $1 million-plus apartments have been for sale, have been hit hardest over the past year, according to research by Australian Property Monitors.
Owners of some of the most expensive penthouses and flats in the city are having to slash their asking prices by millions in some cases to close deals. Others have had to sell for well below what they paid, even after years in the exclusive buildings.


http://theage.domain.com.au/top-end-caught-flatfooted-as-property-slump-worsens-20120505-1y618.html
 

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All those in flood affected QLD who can't get insurance with Suncorp unless they want to pay top $$ should be worried it means their property is worth nothing not even the land.
Which in turn will help push the price of RE down.
The fault is with the councils wanted revenue at any cost and allowing building in flood plains.
There will be other areas in QLD in the same boat.
I assume this will be the trend as the years roll on and insurance companies nit pick where they want to do business.
I guess the banks will be looking at it after all if you can't insure your house then the banks will want their loot back.
 
Julia said:
It wasn't a project home. Why is the cost relevant?
Click to expand...

So the bear****ters on this forum can understand just how much it costs to build a house and that the builder does not price his materials in multiples of the average wage.

Glen explain to me how decreasing supply (of insurable land) lowers prices?
 
im sparticus said:
So the bear****ters on this forum can understand just how much it costs to build a house and that the builder does not price his materials in multiples of the average wage.
Click to expand...
No they just price their wages as multiple of the average wage

Do you really have to wonder why building a house cost so much when tradies are out earning doctors and engineers You don't see many tradies getting around in beat up old utes anymore.

Cheers
 

supply and demand my friend. if there wasnt so many people forbidding their children to be tradesmen back in the day, telling them to 'make something of themselves', we wouldnt be able to charge so much, as there wouldnt be so little skilled labour. i personally thank all those that look down on tradies $$$ (not saying you are one of these people). this combined with people originally thinking there was no money in it, and an unwillingness by some to 'get their hands dirty' and a number of other factors has led to good times for those that pursued it

not to mention the money made by builders/developers is huge compared to that of your plumbers and sparkys. sure they make good coin, but builders have been riding the boom wave for years now with huge profit margins. people could buy off the plan and have their purchase worth 30k more before it was even finished. that money stops with them(the builders/developers), and doesnt filter down through all subbies. this may not be as noticeable of late with margins coming under pressure, and profits being slashed. tech/a noted he hasnt seen it this bad since the late 80's.

we won't have it good for much longer anyway. the building and construction industry is in my opinion one of the most under threat of a severe downturn. the guys who are actually good at their jobs should be ok. the duds shall finally be culled.
 

Provide evidence, cause it isnt many on top dollar unless they run a team.
 
The alternative would be that those of us who have taken care not to live in flood prone areas would continue to massively subsidise the premiums of those who have chosen to ignore the risks and live on river banks etc.

I totally support Suncorp's action here. They are not firing existing customers. They are simply saying they will no longer issue new business in these areas.
 
moXJO said:
Provide evidence, cause it isnt many on top dollar unless they run a team.
Click to expand...

He may be over-exaggerating on the doctor call, i would imagine they are on upwards of 200k plus(just a rough guess). if he is referring to trades in the mines, then possibly, but even then a sparky(in the mines) with experience for example would be getting about 120-130k, maybe more depending on how good/valuable he is. keeping in mind they only work around 5 months of the year on bhp or rio roster.

There is plenty of money for plebs in construction. in fact, so long as you put in the hours(60 or so a week) you can easily make more than project managers(team leaders) or supervisors. not often supervisors as they tend to work the same hours as the crew in my experience.

the mining boom is undoubtedly keeping property prices in far north and central queensland artificially inflated, and i can only imagine places as far as brisbane aswell(for fly in fly out rosters). ill try find some examples of renting and buying in or around mining towns.
 

you guys are well on your way to understanding why prime aussie realestate is the price it is why in real terms its never been cheaper just because you are earning a pitance and cant afford a place does not everyone else is.
 
im sparticus said:
you guys are well on your way to understanding why prime aussie realestate is the price it is why in real terms its never been cheaper just because you are earning a pitance and cant afford a place does not everyone else is.
Click to expand...

it doesnt matter how much you earn, be it 60k or 260k, it is not cheap.
 
im sparticus said:
why in real terms its never been cheaper
Click to expand...

Nonsense. Claims like this demand substantiation, please provide your justification and a chart. Considering the ABS released it's latest housing data recently, this is an especially nonsensical claim to make that 10% off the highs is 'never been cheaper'. It was this cheap last time we were here!

When it comes to residential housing, there is no more real measure than affordability. If you feel that average prices which have increased several orders of magnitude against average incomes in the last 10-20-30 years, I have a few Gold Coast properties to sell you.

just because you are earning a pitance and cant afford a place does not everyone else is.
Click to expand...

Who cares about 'everyone'? House prices are set at the margin, almost entirely on the back of new bank credit creation.
 
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