The future of Australian property prices

Bill M · 2 November 2015

For 400K AUD you can buy this house which is 1 hour north of Hornsby or 1 and a half hours from Sydney. I think I would prefer the Central Coast to Houston.

http://www.realestate.com.au/property-house-nsw-hamlyn+terrace-120671689

Beej · 2 November 2015

tech/a said:
Wayne
That's still about $400k AUD
You can get similar here in Adelaide.
20k out. No doubt it's good buying!

You wouldn't in Sydney,Brisbane,Perth or Melbourne

Nor would you in LA,Washington,Chicago or New York.

Not to mention the annual property taxes you have to pay on a house in Houston - on that property you would be looking at $US5k-$10k/year or more - that's the equivalent to paying another $US100k-$US200k up front for the property (roughly, based on a 5% interest rate) - due to the higher ongoing (forever) property tax liability compared to Oz, making it equivalent to a purchase of an oz house for probably around $AU600k-$700k+.

Maybe not as cheap as you think?

McLovin · 2 November 2015

tech/a said:
Wayne
That's still about $400k AUD
You can get similar here in Adelaide.
20k out. No doubt it's good buying!

You wouldn't in Sydney,Brisbane,Perth or Melbourne

Nor would you in LA,Washington,Chicago or New York.

Not to mention the $10k/year in property taxes on that property. No state income tax in TX so they make up for it with property taxes.

qldfrog · 2 November 2015

well, I invite you to look at the actual houses (open links and visit) and I do not think the houses can compare in any way;
I am sure you can find cheap houses in the middle of woop woop in the US too.
Even with the lower AUD, houses here are still far too expensives compared to O/S

luutzu · 2 November 2015

qldfrog said:
well, I invite you to look at the actual houses (open links and visit) and I do not think the houses can compare in any way;
I am sure you can find cheap houses in the middle of woop woop in the US too.
Even with the lower AUD, houses here are still far too expensives compared to O/S

I don't know how high 19ft ceiling is or how big 4000 sq feet it, going to Houston

Went to those homeworld places and a house similar to that would cost something like 800 to $1M to build here.

A couple years ago a few houses near my parents in Fairfield, Western Sydney... land around 850m2, good flat land with wide frontage... fibro house will need to be cleared and two of them goes for $700k each; the third sold for $920 a few months later.

It's insane.

finnsk · 3 November 2015

Try this for insane
http://www.domain.com.au/402-7-sylvan-avenue-balgowlah-nsw-2093-2012306994?sp=4

luutzu · 3 November 2015

finnsk said:
Try this for insane
http://www.domain.com.au/402-7-sylvan-avenue-balgowlah-nsw-2093-2012306994?sp=4

Maybe it's really nice and spacious on the outside

trainspotter · 3 November 2015

Now this is INSANE !!!!!!!

http://www.heraldsun.com.au/realest...a/news-story/fad2aebbe74810c1a07fad8374a7a0b8

When you read it make reference to the EDDIE McGUIRE veiled finger point.

$30,000 / sqm Pffffffffffffffffffftttttttttttttttt !!!!!!!!!!

Bill M · 3 November 2015

finnsk said:
Try this for insane
http://www.domain.com.au/402-7-sylvan-avenue-balgowlah-nsw-2093-2012306994?sp=4

luutzu said:
Maybe it's really nice and spacious on the outside

I know that building and area like the back of my hand. It is a fairly new complex, city buses at the door, a big club on it's premises, big supermarket downstairs, Bunnings down the road, several boutique shops within a couple of minutes walk, Dentists and Doctors in the complex, bottle shops and several restaurants within walking distance and Manly is a 5 minute bus or car ride away. It is all about position, position, position, whether it's worth 895K is another matter, but it's a nice area. You wouldn't really need a car living there. I lived on the northern beaches most of my life.

CanOz · 3 November 2015

finnsk said:
Try this for insane
http://www.domain.com.au/402-7-sylvan-avenue-balgowlah-nsw-2093-2012306994?sp=4

I like that, not a bad deal at all for Sydney.

luutzu · 4 November 2015

Bill M said:
I know that building and area like the back of my hand. It is a fairly new complex, city buses at the door, a big club on it's premises, big supermarket downstairs, Bunnings down the road, several boutique shops within a couple of minutes walk, Dentists and Doctors in the complex, bottle shops and several restaurants within walking distance and Manly is a 5 minute bus or car ride away. It is all about position, position, position, whether it's worth 895K is another matter, but it's a nice area. You wouldn't really need a car living there. I lived on the northern beaches most of my life.

Don't tell me you sold a similar place and got out of town

Yea I can see the attraction. Wouldn't mind living in the city when I was young and if the folks were loaded Still don't mind now seeing the museums and other attractions... but will need a spare $5 to $10M for the kind of place I'd like... yup, when you're dreaming might as well dream big I'd say.

But yea $895K is another matter for that flat.
How do you start a family there? Maybe 1 kid til they're 2 years before you need to upgrade. But then you can't because you just spent $1m on the place and the market just crashed.

luutzu · 4 November 2015

trainspotter said:
Now this is INSANE !!!!!!!

http://www.heraldsun.com.au/realest...a/news-story/fad2aebbe74810c1a07fad8374a7a0b8

When you read it make reference to the EDDIE McGUIRE veiled finger point.

$30,000 / sqm Pffffffffffffffffffftttttttttttttttt !!!!!!!!!!

Hard to beat that insanity.

Maybe except for those couple Chinese who bought those $20 million, perfectly liveable estates just to knock it down and rebuilt?

I'm starting to think that maybe some rich people didn't get rich because they know how to handle money or have much sense about money.

Bill M · 4 November 2015

luutzu said:
Don't tell me you sold a similar place and got out of town

Yea I can see the attraction. Wouldn't mind living in the city when I was young and if the folks were loaded Still don't mind now seeing the museums and other attractions... but will need a spare $5 to $10M for the kind of place I'd like... yup, when you're dreaming might as well dream big I'd say.

But yea $895K is another matter for that flat.
How do you start a family there? Maybe 1 kid til they're 2 years before you need to upgrade. But then you can't because you just spent $1m on the place and the market just crashed.

Yeah I did but not at those kinds of prices. The type of people who buy those sorts of places are high income couples working in the city with no kids, "DINKS" they use to call them them (double income no kids). They have plenty of disposable income and use their weekends to entertain and drink fine wine on their extra large balconies.

They buy that sort of place for the convenience of getting to town and having everything at their doorstep and they love modern apartments with top class appliances and building security. Normally they work hard and save their $$$ and by the time a kid comes along it's time to move on and they buy a house. If that apartment was 2 bedroom it would be worth it to me but only 1 bedroom? I don't think so.

poverty · 4 November 2015

luutzu said:
I'm starting to think that maybe some rich people didn't get rich because they know how to handle money or have much sense about money.

Definitely true in China, corruption and bribery is the path to riches there.

Mrmagoo · 4 November 2015

wayneL said:
Reality check

36 squares, 30 min drive from Houston CBD. Not even the best value just mid range in the burbs

http://www.realtor.com/realestatean...-Park-Ln_Houston_TX_77070_M84656-67781?row=10

View attachment 64862

400k aud, but it is a big well kept home is a decent area, 30 minutes from the CBD.

That is what Australia used to be like.

The homes far away were cheap, for working class people. The homes a bit closer were bit more for people with careers and jobs/two incomes.

It wasn't "must be a millionaire" territory as it is now.

Mrmagoo · 4 November 2015

tech/a said:
Wayne
That's still about $400k AUD
You can get similar here in Adelaide.
20k out. No doubt it's good buying!

You wouldn't in Sydney,Brisbane,Perth or Melbourne

Nor would you in LA,Washington,Chicago or New York.

There are more job opportunities in the USA. Their unemployment rate is lower. Australia is only better if you're a rich tradesman or property investor.

McLovin · 4 November 2015

qldfrog said:
well, I invite you to look at the actual houses (open links and visit) and I do not think the houses can compare in any way;
I am sure you can find cheap houses in the middle of woop woop in the US too.
Even with the lower AUD, houses here are still far too expensives compared to O/S

I'd hardly call the Central Coast whoop-whoop. Median household income in Sydney ~$75k, in Houston US$44k or roughly $60k at current fx rate. Add in the $10k in property tax and that house in Houston doesn't look like such a steal.

And that's before you get to the part where you have to live in Houston.

skcots · 4 November 2015

McLovin said:
I'd hardly call the Central Coast whoop-whoop. Median household income in Sydney ~$75k, in Houston US$44k or roughly $60k at current fx rate. Add in the $10k in property tax and that house in Houston doesn't look like such a steal.

And that's before you get to the part where you have to live in Houston.

From a numbers game the house in Houstan is appealing whether I would like it there or not is a different story.

Property tax on that house would be $7500 AUD which is far less then the income tax and medicare levy of $17500 AUD for Mr Median.

McLovin · 4 November 2015

skcots said:
From a numbers game the house in Houstan is appealing whether I would like it there or not is a different story.

Property tax on that house would be $7500 AUD which is far less then the income tax and medicare levy of $17500 AUD for Mr Median.

The tax on that house last year was $US6,558 so around AU$9,400, the year before that it was over US$7,000. Property tax is not a replacement for income tax. You would still be paying US federal income tax at marginal rates and FICA at 6.2%.

ETA: It's 30 miles (50kms) from the Houston CBD, not 30 minutes, unless you own a helicopter.

skcots · 4 November 2015

McLovin said:
The tax on that house last year was $US6,558 so around AU$9,400, the year before that it was over US$7,000. Property tax is not a replacement for income tax. You would still be paying US federal income tax at marginal rates and FICA at 6.2%.

So much the same annual cost as living in Sydney then.

McLovin said:
ETA: It's 30 miles (50kms) from the Houston CBD, not 30 minutes, unless you own a helicopter.

Google maps says 26 minutes with no traffic or helicopter.

The future of Australian property prices

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