House asking prices / what you actually paid
Aug 13th 2013, 12:43 am
#61
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Re: House asking prices / what you actually paid
Then the young people should be doing their reno in a not-so-really nice area. And by doing so they will improve the area.
Thirty years ago the inner-western suburbs of Sydney (eg. Newtown, Annandale, Leichhardt) were horrible. Tiny, poky, old houses, run-down streets, no decent shops etc. Then those selfish baby-boomers started buying the cheap houses (because they couldn't afford the nice areas, either), doing them up and now they are extremely desirable suburbs. Same with Paddington in the 1950s.
Gen X, Y and the like need to do the same. They need to find the cheap suburbs to buy and renovate in.
They can't expect to be given it all on a plate..
Thirty years ago the inner-western suburbs of Sydney (eg. Newtown, Annandale, Leichhardt) were horrible. Tiny, poky, old houses, run-down streets, no decent shops etc. Then those selfish baby-boomers started buying the cheap houses (because they couldn't afford the nice areas, either), doing them up and now they are extremely desirable suburbs. Same with Paddington in the 1950s.
Gen X, Y and the like need to do the same. They need to find the cheap suburbs to buy and renovate in.
They can't expect to be given it all on a plate..
Aug 13th 2013, 2:41 am
#62
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Joined: Oct 2005
Location: Hill overlooking the SE Melbourne suburbs
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Re: House asking prices / what you actually paid
Then the young people should be doing their reno in a not-so-really nice area. And by doing so they will improve the area.
Thirty years ago the inner-western suburbs of Sydney (eg. Newtown, Annandale, Leichhardt) were horrible. Tiny, poky, old houses, run-down streets, no decent shops etc. Then those selfish baby-boomers started buying the cheap houses (because they couldn't afford the nice areas, either), doing them up and now they are extremely desirable suburbs. The cafes, bars and shops followed the people. Same with Paddington in the 1950s.
Gen X, Y and the like need to do the same. They need to find the cheap suburbs to buy and renovate in.
They can't expect to be given it all on a plate..
Thirty years ago the inner-western suburbs of Sydney (eg. Newtown, Annandale, Leichhardt) were horrible. Tiny, poky, old houses, run-down streets, no decent shops etc. Then those selfish baby-boomers started buying the cheap houses (because they couldn't afford the nice areas, either), doing them up and now they are extremely desirable suburbs. The cafes, bars and shops followed the people. Same with Paddington in the 1950s.
Gen X, Y and the like need to do the same. They need to find the cheap suburbs to buy and renovate in.
They can't expect to be given it all on a plate..
Aug 13th 2013, 4:43 am
#63
Almost more Oz than Pom
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Location: Brisbane northern suburbs
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Re: House asking prices / what you actually paid
Originally Posted by Zen 10
We surely do not have dredge up the statistical facts demonstrating the unaffordability of all housing today relative to the 1970s, do we?
Aug 13th 2013, 5:57 am
#64
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Re: House asking prices / what you actually paid
I dont think it can really be argued that housing is less affordable now, prices are higher and the multiples of your wage has increased. When a house goes up 300% in a decade and wages go up say 25% then the gap is widening at a huge pace.
Aug 13th 2013, 6:49 am
#65
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Re: House asking prices / what you actually paid
You state initially that it can't be argued that housing is less affordable?
Aug 13th 2013, 6:55 am
#66
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Re: House asking prices / what you actually paid
late 1980s - a whole swag of people with negative equity and huge loans.
1970s - inflation.
I am reminded though that it was actually a lot harder to get a mortgage in the 70s - apparently.
There seemed a sweet spot in the early - mid 90s when people got sustained employment and scooped up cheap properties. I knew of people who got out of FE in 1990-1992, they dropped out - and bought desirable stock for silly prices that had doubled even as early as 1998. So they escaped the negative equity and early 90s recessions and saw 15 years of growth - so even by the GFC they had some solid foundation. Some of these people might then have made a killing moving to Australia in the early 00s....!!
Aug 13th 2013, 7:09 am
#67
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Re: House asking prices / what you actually paid
Aug 13th 2013, 7:38 am
#68
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Aug 13th 2013, 9:17 am
#69
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Re: House asking prices / what you actually paid
But... 300% in a decade ? Maybe the odd house or two, but not Sydney.
This chart is only for FIVE years, but it gives an idea..
You can see some Sydney 10 year (decade) figures at: http://www.abcdiamond.com/australia/...orkers-sydney/
Nov 2002 $394,000
Nov 2012 $605,200 = 53% in 10 Years
Wages however rose by about 58% for that same 10 year period.
http://www.abcdiamond.com/australia/...-2002-to-2012/
Aug 13th 2013, 9:27 am
#70
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Re: House asking prices / what you actually paid
Did you pay asking price for your house here in Australia? If not, what kind of percentage did you knock off? Was your offer laughed at? We only need to talk percentages here, not actual dollars as that's private. In England we knocked 10% off our last house, and eventually settled on a price 7% under asking price.
I was talking to someone recently, Aussie, who said she always goes in 30% under and lets the owner drag them up. What was your strategy here, and how successful was it? It seems to me most Australian houses are around 30% to 40% overvalued, at asking price, but are vendors taking offers in your area?
Also, I add in edit - in Australia they put a wide range on the asking price (i.e. 550,000 - 590,000) - how did you deal with that? I've been cutting it down the middle and calling that the asking price. (i.e. 570,000). How do Aussies read this wide range? My own research seems to suggest houses go for around 5% to 10% under the middle of the range. Any other experiences? Thanks to all.
I was talking to someone recently, Aussie, who said she always goes in 30% under and lets the owner drag them up. What was your strategy here, and how successful was it? It seems to me most Australian houses are around 30% to 40% overvalued, at asking price, but are vendors taking offers in your area?
Also, I add in edit - in Australia they put a wide range on the asking price (i.e. 550,000 - 590,000) - how did you deal with that? I've been cutting it down the middle and calling that the asking price. (i.e. 570,000). How do Aussies read this wide range? My own research seems to suggest houses go for around 5% to 10% under the middle of the range. Any other experiences? Thanks to all.
Example (my area)
Capalaba LGA Redland
Trends - Houses
Median Price $414,000
Days on market 95
Discounting 7.4%
Trends - Units
Median Price $385,000
Days on market 205
Discounting 8.2%
Also, back in 2012
Last edited by ABCD......; Aug 13th 2013 at 9:29 am. Reason: added image
Aug 13th 2013, 12:07 pm
#71
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Re: House asking prices / what you actually paid
At those rates, who could argue...
But... 300% in a decade ? Maybe the odd house or two, but not Sydney.
This chart is only for FIVE years, but it gives an idea..
http://www.abcdiamond.com/wp-content...ange-graph.png
You can see some Sydney 10 year (decade) figures at: http://www.abcdiamond.com/australia/...orkers-sydney/
Nov 2002 $394,000
Nov 2012 $605,200 = 53% in 10 Years
Wages however rose by about 58% for that same 10 year period.
http://www.abcdiamond.com/australia/...-2002-to-2012/
But... 300% in a decade ? Maybe the odd house or two, but not Sydney.
This chart is only for FIVE years, but it gives an idea..
http://www.abcdiamond.com/wp-content...ange-graph.png
You can see some Sydney 10 year (decade) figures at: http://www.abcdiamond.com/australia/...orkers-sydney/
Nov 2002 $394,000
Nov 2012 $605,200 = 53% in 10 Years
Wages however rose by about 58% for that same 10 year period.
http://www.abcdiamond.com/australia/...-2002-to-2012/
Aug 13th 2013, 1:45 pm
#72
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Re: House asking prices / what you actually paid
I bought a house in Brisbane in 2002, for $385,000 ... that means it should be worth $1.15 million now at 300% ?
In reality, maybe half that...
Some areas are high, some are low, but I doubt the average is 300% over 10 years.
Brisbane averaged 7.3% per year for the 5 years to 2010. That was 42% in total.
Australia wide: Median house prices:
1990 $108,000
2010 $425,000
That gave a 294% rise in the 20 years between 1990 and 2010.
That is an average rise of 5.5% per year.
Your profit of 300% in 10 years was great timing
In reality, maybe half that...
Some areas are high, some are low, but I doubt the average is 300% over 10 years.
Brisbane averaged 7.3% per year for the 5 years to 2010. That was 42% in total.
Australia wide: Median house prices:
1990 $108,000
2010 $425,000
That gave a 294% rise in the 20 years between 1990 and 2010.
That is an average rise of 5.5% per year.
Your profit of 300% in 10 years was great timing
Aug 13th 2013, 2:20 pm
#73
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Re: House asking prices / what you actually paid
I didnt say the average was 300% in 10 years.
Aug 14th 2013, 1:13 am
#74
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Re: House asking prices / what you actually paid
Hi Zen10,
I am not fully able to comprehend with this idea. If we keep paying the extra on top of our monthly installment wouldn't the percentage of the interest amount reduce and the principal amount being deducted increase?
Thanks for the info!!
I am not fully able to comprehend with this idea. If we keep paying the extra on top of our monthly installment wouldn't the percentage of the interest amount reduce and the principal amount being deducted increase?
Thanks for the info!!
Aug 14th 2013, 10:09 pm
#75
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Re: House asking prices / what you actually paid
One way of achieving this which works well for people paid fortnightly or weekly is to take the calculated calendar month repayment and make that payment every 4 weeks - that way each year you have made a month's payment directly off the outstanding capital without really noticing it.
The offset account mentioned is an interest paying account which you use as your main transaction account: instead of the interest earned by the balance in the account being paid to you (and hence being taxable income) it is used to 'offset' the interest charged on the home loan. So by having your salary paid into the offset account and using the interest free period on your credit card wisely you can significantly reduce the overall cost of your home loan.
Lastly most mortgage lenders will allow you to 'redraw' the extra payments you have made off the outstanding capital, so you have in effect a high interest savings account with funds you can use when emergencies crop up.