The future of Australian property prices

[Smurf1976]

Ok just throwing a couple of concepts into the ring for discussion

Don't know if it still exists but there used to be a scheme where Defence rented houses from private landlords.

Presumably the tenants would be reasonable? Nobody's going to trash the place when their employer's the middleman between them and the owner surely? Doing so would be a good way to lose their job I'd think.

Plus if it's rented to a government agency then even if they pay the rent late, you can be pretty sure they will at least pay it.

 

[qldfrog]

Ok just throwing a couple of concepts into the ring for discussion

1 I answered an ad for housing for disabled with NDIS funding. On the face of it, it looks good, (of course) but I have several misgivings and possible gotchas over the long-term

2 AirBNB. Seriously haven't really looked into this much at all it was just an idea that came up in discussion. Once again looks good on the face of it but I am sure there are many traps.

As a general principle we are not really that keen on direct real estate investment investment, especially considering some of the posts above.

Petty issues are just not on our agenda of things that we want to contend with. We've got enough of that shxt in our own family/lives, never mind having to deal with other fruit loops.

Nb it's not always the tenants, quite often it is the rental agent which should be permanently in a straight jacket and sedated.

Do not think about it...short summary

 

[sptrawler]

I will repeat my earlier post, if you dont want to actually move into the house, all you are doing is supplying social housing, which the Government took years to offload and obviously aren't keen to get back into.

If you dont want to eventually move into it, it is a hard way to make a buck IMO.
Even if you make a profit, the Govt takes a chunk of it, so basically it is just a cheap loan, where you can write off the losses against your taxable income, if you dont make a profit your supplying social housing for free, if you do make a profit, the Govt takes a share, win/ win.
What's in it for you?.

If supplying social housing for NDIS, or anyone else was a winner, the Government would still be doing it themselves, rather than subsidising you to do it.

Rope a dope 101 IMO.
But hey everyone to their own, there is money to be made, but to think it is easy money you have to buy in Sydney, Melbourne. Lol

 

[houtman]

To spend $100’s of thousands of dollars putting a roof over the head of some unappreciative tenant is generally a Mugs game.
Sure there are lots of great tenants but you only need one to slip through.

The only way I would look at it now is
-block or brick internal walls, painted, no plaster, minimise the need for $100/hr tradies
- use the grumpiest agent in town
- lots of capital gain to be had on the land
- and me to be 20yrs younger, just cbf with the hassle any more

 

[divs4ever]

A mate rented a house to disability services and can't sell it now until they can rehouse everyone

cheers ,

i missed an opportunity like that ( buying such a property )

nice to see my 'niggles' were justified

BTW the property sold to another 20% higher than my offer ( but it ain't MY cash , possibly locked solid )

 

[Warr87]

Don't know if it still exists but there used to be a scheme where Defence rented houses from private landlords.

Presumably the tenants would be reasonable? Nobody's going to trash the place when their employer's the middleman between them and the owner surely? Doing so would be a good way to lose their job I'd think.

Plus if it's rented to a government agency then even if they pay the rent late, you can be pretty sure they will at least pay it.

It goes under Defence Housing Australia (DHA). Rent is subsidised for defence members (they pay is fixed but they can be posted to anywhere. I.e. your $80k wage is fine in Perth but different story if you're in Sydney, given you are supposed to live within a 25km radius of your posting). The DHA option is essentially set-and-forget as rental income is guaranteed. But from what I remember, the management fees are much higher than normal. But whether there is a tenant or not wont matter, you'll get your $$$.

 

[Dona Ferentes]

But from what I remember, the management fees are much higher than normal. But whether there is a tenant or not wont matter, you'll get your $$$.

Close to 20% mgmt fees. And they do a full clean/ restore at end of lease.

I used to own a 3br house in Campbell, next to Russell defence complex in Canberra. As it was 'officer' status, the non-working partner usually kept the place in immaculate condition. And no problem finding tenants

 

[JohnDe]

If anyone is not making decent money from residential renting, they either have purchased a property in a poor location or have a poor quality property.

I purchased my first rental property 30 years ago, in an up and coming suburb. I experienced some headaches from tenants but very few investments are stress free. I eventually bulldozed one property & built. That suburb is no booming & the rent has increased substantially, with high income tenants that have pride and maintain the property perfectly.

 

[InsvestoBoy]

Don't know if it still exists but there used to be a scheme where Defence rented houses from private landlords.

Presumably the tenants would be reasonable? Nobody's going to trash the place when their employer's the middleman between them and the owner surely? Doing so would be a good way to lose their job I'd think.

Plus if it's rented to a government agency then even if they pay the rent late, you can be pretty sure they will at least pay it.

This scheme still exists. I live in a house that was once a Defence rental in a block of 4 Torrens title houses. Only 1 of them is still rented by Defence.

The previous tenant of that house just moved out, I was chatting with him on move out day and he was complaining about DHA as a horrible landlord, they pick every nit and dock your pay if it's not perfect. They moved out as they were buying their own place in Penrith.

 

[Warr87]

Close to 20% mgmt fees. And they do a full clean/ restore at end of lease.

I used to own a 3br house in Campbell, next to Russell defence complex in Canberra. As it was 'officer' status, the non-working partner usually kept the place in immaculate condition. And no problem finding tenants

yea, that's about right. And also, I personnally wouldn't put much stock into an 'officer' type to be too clean. There are still roles in defence specifically to clean up and bring meals to said officer types ...

This scheme still exists. I live in a house that was once a Defence rental in a block of 4 Torrens title houses. Only 1 of them is still rented by Defence.

The previous tenant of that house just moved out, I was chatting with him on move out day and he was complaining about DHA as a horrible landlord, they pick every nit and dock your pay if it's not perfect. They moved out as they were buying their own place in Penrith.

DHA are not particularly good. Not really held in too high of esteem inside of defence, at times. It's a real mixture of people you may get (like most jobs I guess). Plenty of friends have complained about them that's for sure. It's usually them sticking rigidly to policies or rules that do not apply/make little sense, even when discretion would apply.

But enough on them ...

I am of the opinion that property is not the fool-proof type of investment it is touted by many. I think people here wouldn't hold that believe as any investment carries a risk, and no investment is guaranteed to go up over time.

 

[JohnDe]

This scheme still exists.. I was chatting with him on move out day and he was complaining about DHA as a horrible landlord, they pick every nit and dock your pay if it's not perfect……

Almost every tenant says that.

 

[dyna]

LEVERAGE.

The magic word.
One of the wisest things I've ever read on this forum, was this : " money... makes... money ".
Meaning, using other people's money ( banks)
It is the way to serious wealth creation.
Simple as that.
As for tenants , up-market R.E. is the only way to go. There is always a keen demand for it.
Sure, you get a lower yield but in the right position, capital gain is the name of the game. You don't need to realise that C.G. either.....just borrow against it. Leverage works. It works like magic.

 

[farmerge]

The magic word.
One of the wisest things I've ever read on this forum, was this : " money... makes... money ".
Meaning, using other people's money ( banks)
It is the way to serious wealth creation.
Simple as that.
As for tenants , up-market R.E. is the only way to go. There is always a keen demand for it.
Sure, you get a lower yield but in the right position, capital gain is the name of the game. You don't need to realise that C.G. either.....just borrow against it. Leverage works. It works like magic.

OPM I love to use it when I can.

 

[divs4ever]

OPM I love to use it when I can.

i love to avoid it ( in most cases ) and sparingly when i do

but then i never dreamed of being rich ( or even middle-class )

 

[Smurf1976]

DHA are not particularly good. Not really held in too high of esteem inside of defence, at times. It's a real mixture of people you may get (like most jobs I guess). Plenty of friends have complained about them that's for sure. It's usually them sticking rigidly to policies or rules that do not apply/make little sense, even when discretion would apply.

From an owner's perspective that's not necessarily a bad thing however. If the rent's being paid and the property is being looked after then you're doing OK.

 

[divs4ever]

From an owner's perspective that's not necessarily a bad thing however. If the rent's being paid and the property is being looked after then you're doing OK.

OR you have dreams of re-developing the property in the future , and say start the long haul to have your property re-zoned ( and redeveloped later )

a nearby suburb to where i grew up went from a suburb of cottages to a plantation of units ( up to 10 two bedroom units per 1940's house block ) ( formerly homes for WW2 veterans )

 

[SirRumpole]

AirBNB seems the way to go these days. You don't have to put up with bad tenants for a long time and you can charge higher rents because people are only there for a short time.

Downside is some councils make rules about short term rentals and you have to get a place in a trendy location like beach side. Then there are seasonal variations as well.

 

[farmerge]

AirBNB seems the way to go these days. You don't have to put up with bad tenants for a long time and you can charge higher rents because people are only there for a short time.

Downside is some councils make rules about short term rentals and you have to get a place in a trendy location like beach side. Then there are seasonal variations as well.

Arvo Sir R and then there is the problem of willful damage to the joint because they don't care.

 

[sptrawler]

It's all about how you present the issue, using the article information, Sydney median house prices peaked at approx $1.6m.
So even with the current fall, the price is still up considerably, on the price three years ago.

Sydney house prices post steepest annual fall on record

Rising interest rates took a toll on buyers’ spending power, but an unexpected trend emerged in the final three months of the year.

www.smh.com.au

Sydney house prices have had their steepest annual fall on record, declining 10.9 per cent last year as rising interest rates took a toll on buyer demand and spending power.

Sydney’s median house price fell more than $170,000 to $1,413,658 last year, the latest Domain House Price Report, released on Wednesday, shows.
House prices are now 11.3 per below their early 2022 peak, but are still 24.2 per cent higher than they were when the market troughed in mid-2020.

Historical Data.

 

[sptrawler]

I mean really, how unfair is this? ?

$511k crash: Blow for every Qld home buyer looking to borrow​

Queensland buyers have seen as much as $511,000 wiped from their borrowing capacities since April last year, with first home buyers and families taking the biggest hit to their budgets.