The future of Australian property prices

FlyingFox · 6 January 2013

RandR said:
I just want to point out the the plumbing legislation allows the homeowner to change tap washers himself ... you dont need to be a licensed plumber to do so

It was just an example. I change my own washers among other things. I will be much more explicit with my examples in the future!

RandR said:
Fark me its not really that hard at all to save a little coin and put together a deposit. You dont need to be a wage slave. Im on an average wage and we've got a house, we can do that and afford to do a bit of travelling, both have decent newish cars and have all the gadgets and doo daas we want. The secret is called saving. Get into it.

If you read the posts carefully; not a lot, if any, of people the people are saying it's too hard and it can't be done. All they are saying is that by most metrics Australian housing is very expensive. Also the question has been asked, why can't someone on a significantly above average afford to buy into the suburb they prefer?

Actually from my reading of the last couple of days posts, most people asking the above question, myself included can afford a house and possibly in the suburb they want. However the to us, it seems illogical, given the state of affairs around the world that housing here should be so expensive.

RandR said:
House prices might not be going anywhere for a while. I couldnt care less, I own a house because i need a place to
live end of story theres no goal to make money from it and even if there was it increasing in price is absolutely pointless. Because it will always have the same relative value to other properties regardless of price movements. I couldnt care less if house prices double in the next decade or drop by half i'll still own it and will still be worth the same value relative to other properties and I only need one.

Fair enough and good on you. I am sure the people that bought property in Tokyo before the housing market there collapsed said the same thing. Now they kids are probably paying off a mortgage for a property worth half the price.

Out of curiosity, when did you buy your place?

FlyingFox · 6 January 2013

sydboy007 said:
.......
The resource industry is a prime example of this. Seems if you are a C level exect then being highly paid for your "skills" is OK, but when the same happens in the blue collar workforce it's a tragedy caused by the unions or labor Govt - usually both.

No one trying to start a class system here. Some of the statements that were made were with regards to pay differences between different profession was looking at it from a purely economic standpoint and looking at opportunity cost.

sydboy007 said:
I do wish we could move away from uni being the idea, to something more like the Germans or Danes who value a trade just as highly. The country would be a lot better off for it.

Being someone who has been through more of uni than most, I can safely say that this is not true. The government might be pushing the idea but that is not the general perception. We have great equality here and this is something to be cherished. From a financial perspective as well, blue collar jobs pay just as well if not better than "skilled" jobs. Leaving the exec's and medical and high level specialties out.

medicowallet · 6 January 2013

So_Cynical said:
Medicowallets reasons made some sense but i doubt any ENT surgeon is really worth 600K+ per year.

That's right i don't have private health insurance mostly because every year i pay this thing called a Medicare levy, silly me thought it was some kind of medical coverage payment, turns out it only get me free GP visits, a discount on a specialist and free cat scans...what i need is just non cosmetic, elective surgery cover, know any fund that's offering that?

--

The receptionist was a stuck up bitch...made me feel like i had wasted her time because she decided i had cover and could afford what she had in mind.

1. Quite a few surgeons that I know make most of their money from the "fast" procedures ( an example might even be polyp removal), and make very little from "long" procedures, (an example might be laryngeal cancer). I think $600k is fair pay for an ENT who could possibly have earned more money with their kind of dedication in alternative fields of interest.

2. Your accountant must be poor, as no doubt you would be paying extra on top of your medicare levy by NOT having private health insurance.

3. Almost all funds offer that, unless I misinterpret your meaning.

4. You can buy a new house each year if you earn $1mil before tax each year from your professional activities.

5. I don't earn $1mil each year

MW

FlyingFox · 6 January 2013

So_Cynical said:
Medicowallets reasons made some sense but i doubt any ENT surgeon is really worth 600K+ per year.

That's right i don't have private health insurance mostly because every year i pay this thing called a Medicare levy, silly me thought it was some kind of medical coverage payment, turns out it only get me free GP visits, a discount on a specialist and free cat scans...what i need is just non cosmetic, elective surgery cover, know any fund that's offering that?

--

The receptionist was a stuck up bitch...made me feel like i had wasted her time because she decided i had cover and could afford what she had in mind.

One big cost factor that didn't get talked about was liability insurance. A big chunk of that 600K goes to that. The surgeon in Oz screws up the op and you can sue him and get a payout. One in Philippines screws up?

Garpal Gumnut · 6 January 2013

Snot fair. We are back on to SC's putrid bloody polyps.

Start a bloody snot thread, if you think a specialist creeping upon or into SC's weeping nose is important.

This is a property thread.

gg

FlyingFox · 6 January 2013

Garpal Gumnut said:
Snot fair. We are back on to SC's putrid bloody polyps.

Start a bloody snot thread, if you think a specialist creeping upon or into SC's weeping nose is important.

This is a property thread.

gg

Sorry. Point taken....back to property everyone....

Mrmagoo · 6 January 2013

What "other" professions could these surgeons enter to earn $6050 per hour ?

The fact that it has gotten so bad we're using a surgeons salary as an arguing point for buying a home.

I think we're really hit the end with house prices when we're needing to go back 50 years (that is a time where most of those arguing house prices are expensive were not even born) to try and justify things.

medicowallet · 6 January 2013

Mrmagoo said:
What "other" professions could these surgeons enter to earn $6050 per hour ?
.

Can't seem to remember to have posted that an ENT surgeon earns $6050 per hour

Even I think over $11mil per year is too much for an ENT

MW

Mrmagoo · 6 January 2013

medicowallet said:
Can't seem to remember to have posted that an ENT surgeon earns $6050 per hour

Even I think over $11mil per year is too much for an ENT

MW

650 an hour, was typo.

medicowallet · 6 January 2013

Mrmagoo said:
650 an hour, was typo.

$650 per hour

Well that I guess is assuming 38 hours 48 weeks....

Perhaps if we go 50 hours 48 weeks will be closer to reality = approx $400 per hour before expenses.

Sounds very reasonable to me.

Other jobs? Perhaps upper echelons of mining, government etc. Not that difficult for these extremely proficient types of people.

MW

Julia · 6 January 2013

Mrmagoo said:
Well you asked, the answer, it was incredibly easy in the 80s and 90s.

I did not say it was incredibly easy. Don't distort what people have said, magoo.
To qualify for that 3% loan we had to put down a 30% deposit. I can't remember what we were earning, but it wasn't much compared to today's salaries.

Later when I bought the first IP I was paying 22% on the mortgage. So just rid yourself of the idea that everything was easy a couple of decades or more ago.
There have always been people who will find a way to get ahead and do well, just as there will always be people like you whose main mission in life is to criticise anyone apparently doing better than they are.

QUOTE=Bill M;746059]Excellent post RandR and that's exactly what it's all about.

+1. Great comments, RandR.

So_Cynical said:
That's right i don't have private health insurance mostly because every year i pay this thing called a Medicare levy, silly me thought it was some kind of medical coverage payment, turns out it only get me free GP visits, a discount on a specialist and free cat scans...what i need is just non cosmetic, elective surgery cover, know any fund that's offering that?

I'm mindful of gg's very reasonable request that we leave aside your nasal problems on the property thread, but are you actually saying it's impossible for you to have a nasal polyp removed in the public system?
I don't believe that for a moment. You might have to sit on a waiting list for a long time, but you will be able to have it done at a public hospital at no cost to yourself eventually.

The reason most sensible people take out private cover is so that they don't have to endure this waiting, and so that they can have a procedure carried out by someone known to be competent, rather than risk some trainee ENT surgeon practising on them. Shop around. There are plenty of funds offering every conceivable private option.

If you're getting free GP visits on Medicare, that's more than most people are.

So_Cynical · 6 January 2013

Lol this thread hasnt been this funny since robots departed.

medicowallet · 6 January 2013

So_Cynical said:
Lol this thread hasnt been this funny since robots departed.

Where is Robots?

MW

PS Where is Robots?

Garpal Gumnut · 7 January 2013

medicowallet said:
Where is Robots?

MW

PS Where is Robots?

He is being held prisoner in the Sinai by a Jihadist Polyp.

gg

explod · 7 January 2013

Garpal Gumnut said:
He is being held prisoner in the Sinai by a Jihadist Polyp.

gg

Was talking to him via pm some time back now and said something about meeting someone on the St Kilda tram.

Understand he is now busy putting on an extra room out the back for the computer.

againsthegrain · 7 January 2013

explod said:
Was talking to him via pm some time back now and said something about meeting someone on the St Kilda tram.

Understand he is now busy putting on an extra room out the back for the computer.

maybye his a contenstant on the new block working hard and not allowed outside world communication

psailagroup · 7 January 2013

Julia said:
I did not say it was incredibly easy. Don't distort what people have said, magoo.
To qualify for that 3% loan we had to put down a 30% deposit. I can't remember what we were earning, but it wasn't much compared to today's salaries.

Later when I bought the first IP I was paying 22% on the mortgage. So just rid yourself of the idea that everything was easy a couple of decades or more ago.
There have always been people who will find a way to get ahead and do well, just as there will always be people like you whose main mission in life is to criticise anyone apparently doing better than they are.

+1. Great comments, RandR.

I'm mindful of gg's very reasonable request that we leave aside your nasal problems on the property thread, but are you actually saying it's impossible for you to have a nasal polyp removed in the public system?
I don't believe that for a moment. You might have to sit on a waiting list for a long time, but you will be able to have it done at a public hospital at no cost to yourself eventually.

The reason most sensible people take out private cover is so that they don't have to endure this waiting, and so that they can have a procedure carried out by someone known to be competent, rather than risk some trainee ENT surgeon practising on them. Shop around. There are plenty of funds offering every conceivable private option.

If you're getting free GP visits on Medicare, that's more than most people are.

Hi Julie,
I am 28 and love your reasons to the above points, I bought my first IP at 21 and I had to work three jobs to save a decent deposit in one year. I think the biggest issue we have is this, To many people are short sighted on a long term goals, people want everything now but are not willing to really push as well. Even thought My wife and I are comfortable I still work two jobs and my wife work one job (well she just got sacked lol), I always believe that you need two incomes, One income to purely save, the other income to service your expenses and if you budget correctly use that extra money to save.

Allot of people think Australia is a hard place now, Give it 10 years and things are going to get even harder, Dole will be scrapped and to top it off Medicare will also be scrapped as well.
And I also respect your point about “different times” History always repeats its self but it just sounds different. Sure right now we face higher property prices but back then you had higher interest rates and in all fairness it was harder to get a home loan as well.
Now funding is allot easier, interest rates are low but property prices are higher

The biggest issues humans face right now is not an expensive world but the ability to change to a changing environment.

PS yesterday at a BBQ a friend of mine who is on a low wage wants to move house, I said why?? We want a bigger home our 3 bedroom home is to small for me and my wife. Where planning to have kids in 3 to 5 years time.

People want to much and not prepaired to give something back for it

againsthegrain · 7 January 2013

psailagroup said:
Hi Julie,
I am 28 and love your reasons to the above points, I bought my first IP at 21 and I had to work three jobs to save a decent deposit in one year. I think the biggest issue we have is this, To many people are short sighted on a long term goals, people want everything now but are not willing to really push as well. Even thought My wife and I are comfortable I still work two jobs and my wife work one job (well she just got sacked lol), I always believe that you need two incomes, One income to purely save, the other income to service your expenses and if you budget correctly use that extra money to save.

Allot of people think Australia is a hard place now, Give it 10 years and things are going to get even harder, Dole will be scrapped and to top it off Medicare will also be scrapped as well.
And I also respect your point about “different times” History always repeats its self but it just sounds different. Sure right now we face higher property prices but back then you had higher interest rates and in all fairness it was harder to get a home loan as well.
Now funding is allot easier, interest rates are low but property prices are higher

The biggest issues humans face right now is not an expensive world but the ability to change to a changing environment.

PS yesterday at a BBQ a friend of mine who is on a low wage wants to move house, I said why?? We want a bigger home our 3 bedroom home is to small for me and my wife. Where planning to have kids in 3 to 5 years time.

People want to much and not prepaired to give something back for it

Typical FHOB mentality that was imposed on them by the baby boomers back at the peak. A bedroom for each pet and garage spot the the bicycle. Some people are going to get a bit bite from reality when it catches upto them.

sydboy007 · 7 January 2013

Seems the hissing sound of house price deflation is continuing. Would definitely not want Melbourne property with their over building of apartments.

I'm just hoping unemployment holds up and we get a sideways crawl for a few more years on property prices while we keep on the slow grind to paying off some of the humongous private debt we've racked up.

It's an election year, so pretty please no more wasted home vendors grants that will suck in another round of first home owners bidding up prices and vendors pocketing the growth.

I just keep asking myself what's going to happen once the boomers find they need to start selling some of their IPs to fund their retirement? In a low credit growth, trend income growth environment, couple with an uptick in sellers, will there be enough demand to hold prices at current levels, or will we see a dramatic revaluation of housing stock?

I'm thinking around 2022 is when this will become a big issue.

DB008 · 7 January 2013

Hmm...

http://www.sqmresearch.com.au/SQMResearchMediaReleasevacancyratesNovember2012.pdf

Domain.com

Vacancy rates in a stable state

Melbourne's residential vacancy rate in August did not change from the 1.9 per cent recorded in July. As a result, the median rent for a house remained at $380 a week. The median rent for an apartment decreased by $1 - from $360 to $359 a week.

The Real Estate Institute of Victoria is now collecting, publishing and analysing rents as well as vacancy rates each month.

Within the metropolitan area, the highest vacancy levels are in the suburbs within four kilometres of the city centre, where a rate of 2.6 per cent was recorded, up from 2.3 per cent in July. There was an increase in the middle suburbs, too, from 2 per cent to 2.2 per cent, and also in the outer suburbs, from 1 per cent to 1.4 per cent.

In regional Victoria, there was a tightening in the vacancy rate from 2.9 per cent to 2.2 per cent and a small rise in the median rent for a house - from $290 to $300.

Advertisement
Of the larger regional centres, Geelong has a high vacancy rate of 3.8 per cent. This was down on the 4.7 per cent in July. In Ballarat there was a minor tightening from 1.9 per cent to 1.5 per cent and vacant rental properties continue to be scarce in Bendigo, which posted a vacancy rate of 0.9 per cent, down from 1 per cent in July.

Overall, these results reflect a stable rental market with little pressure on rents.

http://news.domain.com.au/domain/real-estate-news/vacancy-rates-in-a-stable-state-20120921-26a5g.html

I have a few IP's. Never had a problem renting them out.

The future of Australian property prices

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FlyingFox

medicowallet

FlyingFox

Garpal Gumnut

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Mrmagoo

medicowallet

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medicowallet

Julia

In Memoriam

So_Cynical

The Contrarian Averager

medicowallet

Garpal Gumnut

Ross Island Hotel

explod

explod

againsthegrain

psailagroup

againsthegrain

sydboy007

DB008

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