The future of Australian property prices

[againsthegrain]

Geez just talking to a friend in Caloundra, his neighbour bought his house 5 years ago for around $580 000 sold it last week for 1.2 million. The house is over 40yo.

No house on the street was bought for a million, now every house on the market gets a minimum of a million and they are selling like hotcakes.

Why is anyone wasting time and money on the stock exchange, show me where you can get 100% gain in 5 years in any share market.

Housing has gone nuts.

So he only doubled his money? in 5 years?

Speaking in hindsight is a easy thing but looking back wouldn't be hard to find many stocks that more then doubled in price... and of course if you bought 580k of bitcoin 5 years ago...

 

[qldfrog]

Noosa hinterland prices more than double in 2y.i have been lucky, compensate for my share losses

 

[3 hound]

A lot of the neighbours know each other and a lot of the houses being sold the owners have paid off their mortgages so the street is full of new millionaires. Remember when that was a rare thing.

This is the what's driving my area up, people selling on the sunny coast for over a million then moving inland and buying an acreage with a nice view and house for less than half that and retiring early.

Where is the economic doomsday crisis the finance gurus never stop bleating about - it never happens, people are getting richer everywhere, even the unemployed.

 

[bluekelah]

Sp you expect everyone ar retirement age to own his her home?
I looked for a socialist Scandinavian heaven:
Sweden: where less than 40pc of people own their houses
Australian situation of very high ownership is an anomaly and the Reset coming is making sure we will go back in rank...

https://www.statista.com/statistics/539993/sweden-households-by-type-of-housing/#:~:text=In 2019, the majority of,were rented multi-dwelling buildings.

From 1960 to 2020 the population of Sweden increased from 7.48 m to 10.35 m people. This is a growth by 38.3 percent in 60 years. The highest increase in Sweden was recorded in 2017 with 1.36%.

In contrast Aussie population has gone from 10.28 million (1960) to 25.69m in 2020 (~150% increase). Sydney had close to 5m in 2020 thats half of Swedish Pop in one city.

Perhaps extreme high population growth and absolute total population concentrated per capital city is driving up property demand and hence prices. you could say infrastructure has not kept up with the OVERPOPULATION...

 

[bluekelah]

A lot of the neighbours know each other and a lot of the houses being sold the owners have paid off their mortgages so the street is full of new millionaires. Remember when that was a rare thing.

This is the what's driving my area up, people selling on the sunny coast for over a million then moving inland and buying an acreage with a nice view and house for less than half that and retiring early.

Where is the economic doomsday crisis the finance gurus never stop bleating about - it never happens, people are getting richer everywhere, even the unemployed.

I am in QLD as well. We have been lucky as recent crazy spikes in coal prices and gas prices have created a money boom here. Same with perth with iron ore and coal prices going nuts past few years.

In addition, All the foreign money pouring into sydney/melb has also been pouring into Brisbane in recent year. My suburb in southern brisbane has gone from 800k for a stanfard 4 bedder on 600sqm to 1.3m this year (most snapped up by cashed up interstate migrants from down south aka the Mexicans)

coupled with easy monetary policy its another 2003-2004 boom time all over again.

But i reckon the music is ending soon. RBA will likely have to hike fast, probably to 10% at least if it wants to have any chance of beating inflation. As in US, our CPI numbers are rigged, many items up in price, even 2L milk costs 20% more, some veges 100%. Rent price up , thats if you are even lucky enough to grab a rental. Higher rates will definitely see a fast reversal in prices as many investors will start to run for the exits or be unable to afford repayments. a 2% rate rise on a 2%+ variable mortgage means double repayments, most young buyers are leveraged to their eyeballs will have to sell up and go back to live with mom and pops.

very interesting year ahead for aussie property, i would predict lower prices as RBA continues to hike post election.

 

[divs4ever]

Geez just talking to a friend in Caloundra, his neighbour bought his house 5 years ago for around $580 000 sold it last week for 1.2 million. The house is over 40yo.

No house on the street was bought for a million, now every house on the market gets a minimum of a million and they are selling like hotcakes.

Why is anyone wasting time and money on the stock exchange, show me where you can get 100% gain in 5 years in any share market.

Housing has gone nuts.

but where else do you put a million dollars without your investment being eroded by inflation ... stocks ?? MAYBE but that might involve a bit of luck ( even if buying something like WES or BHP )

there is a CHANCE ( not a certainty ) that the Caloundra property will hold it's relative value long term

 

[divs4ever]

A lot of the neighbours know each other and a lot of the houses being sold the owners have paid off their mortgages so the street is full of new millionaires. Remember when that was a rare thing.

This is the what's driving my area up, people selling on the sunny coast for over a million then moving inland and buying an acreage with a nice view and house for less than half that and retiring early.

Where is the economic doomsday crisis the finance gurus never stop bleating about - it never happens, people are getting richer everywhere, even the unemployed.

YEP i would rather be living on a decent hillside ( despite the fact i am not as spry as i used to be )

but don't worry that doomsday WILL come eventually , it could be a slow boil or a massive meltdown ( say banks calling in mortgages prematurely )

 

[Smurf1976]

Geez just talking to a friend in Caloundra, his neighbour bought his house 5 years ago for around $580 000 sold it last week for 1.2 million. The house is over 40yo.

Emphasis mine.

In the current circumstances I'd be extremely cautious about buying a brand new place, anything in the past few years.

Sure there are good, honest builders and tradies but with the market as it is there's a huge incentive to pump houses out as fast as can possibly be done and that's not conducive to high quality workmanship. Doubly so given the backdrop of materials shortages and inflation, pandemic and so on.

 

[moXJO]

Emphasis mine.

In the current circumstances I'd be extremely cautious about buying a brand new place, anything in the past few years.

Sure there are good, honest builders and tradies but with the market as it is there's a huge incentive to pump houses out as fast as can possibly be done and that's not conducive to high quality workmanship. Doubly so given the backdrop of materials shortages and inflation, pandemic and so on.

I've been called out of retirement by some old customers to look at some of these dodgy built homes. Lots of defects everywhere.
Just the basics are even screwed up.

 

[over9k]

A lot of the neighbours know each other and a lot of the houses being sold the owners have paid off their mortgages so the street is full of new millionaires. Remember when that was a rare thing.

This is the what's driving my area up, people selling on the sunny coast for over a million then moving inland and buying an acreage with a nice view and house for less than half that and retiring early.

Where is the economic doomsday crisis the finance gurus never stop bleating about - it never happens, people are getting richer everywhere, even the unemployed.

And this is why price rises have been fastest/steepest in rural and coastal areas.

 

[moXJO]

A lot of the neighbours know each other and a lot of the houses being sold the owners have paid off their mortgages so the street is full of new millionaires. Remember when that was a rare thing.

This is the what's driving my area up, people selling on the sunny coast for over a million then moving inland and buying an acreage with a nice view and house for less than half that and retiring early.

Where is the economic doomsday crisis the finance gurus never stop bleating about - it never happens, people are getting richer everywhere, even the unemployed.

I was lucky enough to turn from bear to bull on property a while back by a member of this forum. Ended up making me a lot of money. Documented on this thread somewhere.

Imo there was never a better time in history to become a millionaire then the last 20 years. Multiple avenues, new industries. It's been a crazy ride.

Right now it feels like it's about to contract. These things take time and often play out over years, not one sudden drop. It's hard to pick the roll-over. But it looks like its heading that way now.

Government intervention and its a bull all over again though.

 

[greggles]

Emphasis mine.

In the current circumstances I'd be extremely cautious about buying a brand new place, anything in the past few years.

Sure there are good, honest builders and tradies but with the market as it is there's a huge incentive to pump houses out as fast as can possibly be done and that's not conducive to high quality workmanship. Doubly so given the backdrop of materials shortages and inflation, pandemic and so on.

Old houses were built to last. A lot of the hardwood from way back was sourced from the best hardwood species when there was a lot of choose from. Try putting a nail in it now after it's been seasoning for 60 or 70 years. It's as tough as granite. Builders took pride in what they built, now it all about cutting costs and maximising profit. Give me an old hardwood house any day.

 

[JohnDe]

Builders took pride in what they built, now it all about cutting costs and maximising profit. Give me an old hardwood house any day.

That's not necessarily so. I knew a few old builders (now passed away) and they told me some interesting stories about short cuts that was common in their day, and shortage of materials which required interesting solutions to be used.

 

[over9k]

Old houses were built to last. A lot of the hardwood from way back was sourced from the best hardwood species when there was a lot of choose from. Try putting a nail in it now after it's been seasoning for 60 or 70 years. It's as tough as granite. Builders took pride in what they built, now it all about cutting costs and maximising profit. Give me an old hardwood house any day.

QFT

 

[greggles]

That's not necessarily so. I knew a few old builders (now passed away) and they told me some interesting stories about short cuts that was common in their day, and shortage of materials which required interesting solutions to be used.

Well there are always exceptions, but in general old houses were built better and intended to last longer than they are now. Workmanship these days leaves a lot to be desired. I have owned an old hardwood house and it was as sold as a rock 80 years later.

 

[JohnDe]

Well there are always exceptions, but in general old houses were built better and intended to last longer than they are now. Workmanship these days leaves a lot to be desired. I have owned an old hardwood house and it was as sold as a rock 80 years later.

I think that nostalgia plays a part in what people perceive as quality and longevity.

My home was build in the late 1800's, I purchased it in 1988 and moved in 1990. The previous owner had done a lot of work, upgrades and replaced water pipes and added an extension.

My partner and I have also had to upgrade and replace parts of the house, and we added another extension.

Maintenance is the trick to a home lasting many years. And with that maintenance we find things that need to be repaired or replaced.

Building regulations have come a long way in the past 50 plus years. Planning has improved sewerage and storm water piping, plaster and concrete are tougher than they were, especially since there are standards now.

I love my 130+ year home, double brick is a better insulator and sound proofer. But the walls aren't quite square, the floor boards not quite true, the ceiling needs gaps repaired every decade.

A well built new home, like the couple of investments I had built 6 years ago, can last a very long time, with the benefit of having square and level walls and floors

So, How long will a new house last?​

​

This is largely debated within the construction industry as it is really dependant on the materials that are used, the quality of the workmanship and the maintenance that is required and followed through on. On average, the generally expected and acceptable lifespan of a home should last at least 60 years. However, many believe that the lifespan of a home is much longer than that reaching well over 100 years."​

How Long Will A New House Last? | Property Registry

Unsure How Long A New House Will Last? We've Got All The Information So You Can Predict The Lifespan Of Your New Build.

propertyregistry.com.au

 

[over9k]

Maintenance is the trick to a home lasting many years.

Also worth noting that an ounce of prevention is worth a pound of cure here - $1000/year in maintenance avoided for a decade will be a $50,000 repair bill 10 years later, not a $10,000 one.

 

[wayneL]

Old houses were built to last. A lot of the hardwood from way back was sourced from the best hardwood species when there was a lot of choose from. Try putting a nail in it now after it's been seasoning for 60 or 70 years. It's as tough as granite. Builders took pride in what they built, now it all about cutting costs and maximising profit. Give me an old hardwood house any day.

The house on the property I just bought is 80 years old and can attest
to what you say.

Someone put a lot of love and effort into building this place and though it's going to need us to give it some TLC to bring it back to its former glory there's not a whole lot to do really.... Nothing structural at all.

 

[3 hound]

Well there are always exceptions, but in general old houses were built better and intended to last longer than they are now. Workmanship these days leaves a lot to be desired. I have owned an old hardwood house and it was as sold as a rock 80 years later.

I do see some beautiful old homes here, the outclass and outsole any new ones but the maintenance costs are off the scale like using a grinder to bring the exterior surface back to bare wood, oil, paint.... love to own one but not going to invest the time and money into that.

 

[sptrawler]

Well there are always exceptions, but in general old houses were built better and intended to last longer than they are now. Workmanship these days leaves a lot to be desired. I have owned an old hardwood house and it was as sold as a rock 80 years later.

I posted a picture of a house I bought in Midland a suburb of Perth in 1982, it was at least 40-50 years old then and it was chopped in half carted on two truck for 200klm in a storm and then restumped and the two halves nailed back together and the roof put back on.
Now 40 years later it is still there and still being used as a residence, so yes the old hardwood houses were solid and do last and it did have 13' ceilings so it did cop a lot of wind and weather when relocated.