coolshadows

"Households in Cronulla are primarily sole parent and are likely to be repaying over $2000.00 per month on mortgage repayments.
In general, people in Cronulla work in a non-specific occupation.

Currently the median sale price of houses in the area is $1,530,000." - rpdata.com

I also don't think the house price trend is a flat as you suggest above...

ABCDiamond

Hang on... my doctor said I must keep my brain working, this thread is very useful for me ........

MartinLuther

coolshadows

This doesn't guarantee that there won't be a drop in house prices. The UK housing market suffers from high population growth and lack of new housing, but it still saw a change in house prices (basically because credit dried up).

As in every housing market, it all depends on how willing the banks are to lend money. The rule being - as long as banks are willing to lend and there is demand (which in most countries will always be true), house prices will continue to increase. Only when there is a drop in demand or the bank become less willing to lend, then house price will fall.

Only 10 years ago, the average new home loan was around 3.5x salary, anything more was considered 'over stretching'. This has changed over the years and now banks are happy to lend 5x or more. I'm sure as times passes, this will increase to 10x or 20x salary with extended repayment options beyond 30yrs.

As long as ABCDiamond is right in thinking that salaries are keeping in line with the increase in house prices over the years (once fluctuations are flattened out), I don't see a problem.

ABCDiamond

Australian Property Monitors

http://www.homepriceguide.com.au/sna...NSW&source=apm

Hmmm we seem to have conflicting expert property prices.

However, these are the 4 house sales in Cronulla for December...
$830,000 12/12/2009
$1,530,000 23/12/2009
$1,595,000 12/12/2009
$1,612,500 17/12/2009

With the $1,530,000 one plainly there.

The APM median price is taken over a 6 month period, so 'maybe' averages out over more sales ?

ABCDiamond

They are Australian Bureau of Statistics figures, not MY thinking.

Is it YOUR thinking that Cronulla prices are a median of $1.53m or are they figures from another source ?

ABCDiamond

This was the $1,530,000 house in Cronulla

coolshadows

I guess that's the problem with median house prices, often they are only based on actual sales. Sell a few 3 bed houses one week, then more 4 bed the next and the median races away.

rpdata supposedly try to even this out, but it's realestate.com.au behind it, so I guess they have their own agenda.

coolshadows

No, my thinking is that Cronulla is full of rich divorcees of gangsters (hence the 'non-specific occupation').


[I was quoting the suburb report from rpdata]

hereandthere

I'd like to comment on the old trope that demand caused by rising population keeps house prices high.

Canada and the US have higher population increases than Australia and the UK, yet houses there are considerably cheaper. I believe Demographia put this down to planning laws.

Either way, the demand itself is not causing the rise, obviously, or houses in the US would be severely unaffordable, like they are in Aus/UK.

Alfresco

There's no such thing as a housing bubble unless you're a goldfish...

and trapped inside one.

swigski

I used Net income because that's what people actually HAVE in their pocket. No point telling someone the bank they earn $1500 a week when they actually have $1175 deposited in their bank a week.

The people living in the UK reading this are interested in the situation in Australia. They know what's happening in the UK. Why would figures using NET income give them a false impression? It's the real world. I suggest your figures using gross income gives them a false impression.

$610,000 is from rpData Dec 2009. Your figures from ABS are Mar 2009!

swigski

If you don't like, don't read it!!

pomtastic

It's funny how people go on and on about where they can buy Marmite or Monster Munch and yet, signing up for a 30 year debt on the biggest purchase of your life is described by yourself as 'inane'. This subject IS important for many new migrants coming over and they need some facts and alternative views from the 'every thing is rosy' crowd who post endlessly on here.

I disagree with your view that this thread is directionless, there have been some good points and facts raised. People have taken time to post decent responses which is refreshing considering the quality of most of the discussion on this forum.

MartinLuther

Good point. Its interesting how this topic is currently hot. Due in part to the low exchange rate for £s and the housing crash in the UK. (That's if there has been a housing crash in the UK? Some of the posters on here seem to suggest that there hasn't.) Go back a few years when people had much larger deposits and the topic was hardly discussed.