Go Back  British Expats > Living & Moving Abroad > Australia
Reload this Page >

Australian Median Property Prices from 1982 to 2004

Australian Median Property Prices from 1982 to 2004

Old May 11th 2005, 12:38 am
  #16  
BE Enthusiast
 
Jimbo9's Avatar
 
Joined: Jan 2004
Location: Melbourne
Posts: 400
Jimbo9 has a brilliant futureJimbo9 has a brilliant futureJimbo9 has a brilliant futureJimbo9 has a brilliant futureJimbo9 has a brilliant futureJimbo9 has a brilliant future
Default Re: Australian Median Property Prices from 1982 to 2004

Overall work particpation is increasing only slowly, going up for females & down for males -

"Over the last two decades, Australia's labour force participation rate has increased slowly, rising from 60.8% in 1979 to 63.7% in 2002. The main factor behind the long-term rise in the labour force participation rate has been an increase in female participation, which has risen from 43.6% in 1979 to 55.5% in 2002. In contrast, male participation fell from 78.4% to 72.2% over the same period. Graph 1 shows male and female participation rates from 1979 to 2002"

http://www.abs.gov.au/ausstats/[email protected]
Jimbo9 is offline  
Old May 11th 2005, 12:38 am
  #17  
BE Enthusiast
 
Joined: Oct 2004
Location: Berkshire
Posts: 360
sackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant future
Default Re: Australian Median Property Prices from 1982 to 2004

Originally Posted by Badge
It is the dual income family/couple alone that has fueled the housing affordibility. There is no way the average bloke can earn enough to buy some of the homes out there.

But I suppose 30+ years ago, the point is that one income was enough.

Badge
Too true. The thing is, for anyone who has children (and therefore needs a house rather than a flat), they are going to go through a stage where they do not have two full time incomes. This stage will last years and even when it's over there are childcare costs.

As for dual income families resulting in a one-time and irreversible adjustment to house prices, I don't buy it. I heard precisely the same argument put forward in the late 80s but prices in the UK and Australia still crashed in the early 90s.

The bottom line is that we're experiencing a bubble in house prices and therefore will correct to historical average income multiples. Unfortunately, bubbles tend to overcorrect - the UK bubble of the 80s bottomed out at 2.9 x average income.

Anyhow, here's an interesting article about it from GMO:

https://www.gmo.com/NR/rdonlyres/E5E...r_1Q05_ALL.pdf
sackofspuds is offline  
Old May 11th 2005, 12:45 am
  #18  
Badge
Guest
 
Posts: n/a
Default Re: Australian Median Property Prices from 1982 to 2004

Originally Posted by sackofspuds
Too true. The thing is, for anyone who has children (and therefore needs a house rather than a flat), they are going to go through a stage where they do not have two full time incomes. This stage will last years and even when it's over there are childcare costs.

As for dual income families resulting in a one-time and irreversible adjustment to house prices, I don't buy it. I heard precisely the same argument put forward in the late 80s but prices in the UK and Australia still crashed in the early 90s.

The bottom line is that we're experiencing a bubble in house prices and therefore will correct to historical average income multiples. Unfortunately, bubbles tend to overcorrect - the UK bubble of the 80s bottomed out at 2.9 x average income.

Anyhow, here's an interesting article about it from GMO:

https://www.gmo.com/NR/rdonlyres/E5E...r_1Q05_ALL.pdf
quite an interesting ansalysis - and a bit of a departure from the usual arguments

Incidentally one of the reasons why I like australia is that it is not *impossible* that we can get by one income in the *best* times. Best = me being in my current type of work at current rates which is not much to ask for but may not always happen

I still sleep at night put it that way.


Badge
 
Old May 11th 2005, 12:53 am
  #19  
Rocket Scientist
 
MrsDagboy's Avatar
 
Joined: Aug 2003
Location: Dreamland AKA Brisbane which is a different country to the UK
Posts: 6,911
MrsDagboy has a reputation beyond reputeMrsDagboy has a reputation beyond reputeMrsDagboy has a reputation beyond reputeMrsDagboy has a reputation beyond reputeMrsDagboy has a reputation beyond reputeMrsDagboy has a reputation beyond reputeMrsDagboy has a reputation beyond reputeMrsDagboy has a reputation beyond reputeMrsDagboy has a reputation beyond reputeMrsDagboy has a reputation beyond reputeMrsDagboy has a reputation beyond repute
Default Re: Australian Median Property Prices from 1982 to 2004

Originally Posted by Megalania
So how many hours would a house buyer work if a house buyer would buy a house?
Is the answer the same as how much wood could a woodchuck chuck if a woodchuck would chuck wood?
MrsDagboy is offline  
Old May 11th 2005, 1:06 am
  #20  
ABCDiamond
Guest
 
Posts: n/a
Default Re: Australian Median Property Prices from 1982 to 2004

Originally Posted by sackofspuds
Anyhow, here's an interesting article about it from GMO:

https://www.gmo.com/NR/rdonlyres/E5E...r_1Q05_ALL.pdf
It is an interesting article. The comparisons of House price to incomes actually suprised me though.
The UK is shown at about 5.8
Australia at about 4.8
Boston USA about 6.5
USA as a whole 4.2
 
Old May 11th 2005, 1:27 am
  #21  
BE Enthusiast
 
Joined: Oct 2004
Location: Berkshire
Posts: 360
sackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant future
Default Re: Australian Median Property Prices from 1982 to 2004

Originally Posted by Badge
quite an interesting analysis - and a bit of a departure from the usual arguments

Incidentally one of the reasons why I like australia is that it is not *impossible* that we can get by one income in the *best* times. Best = me being in my current type of work at current rates which is not much to ask for but may not always happen
Yes, it is interesting, though I think the argument is essentially very simple; house prices are too expensive compared to the historical norms and will correct. The questions that follow are:

1. If you accept a correction will occur, when? Trying to pick the top and bottom of a market is notoriously difficult. If you put off buying back in the early 2000s then you've missed out on some huge rises.
2. If you don't accept it then it follows we're in a "new paradigm" and where's your evidence for it?

The most sensible advice is probably not to overstretch yourself. Don't panic into taking out a mortgage at horrendous multiples of earnings in the fear you will never be able to buy otherwise.

As to you being able to service your mortgage on a single income, is this simply a result of house prices in Oz being cheaper for UK immigrants with housing equity in their back pockets?

I don't want to go on about this, but I've seen statements on here about property in say Perth not being overpriced. The average house in Perth is at about 6 x average earnings. It may look like a bargain to people from outside the country but that doesn't mean it isn't overpriced!
sackofspuds is offline  
Old May 11th 2005, 1:29 am
  #22  
BE Enthusiast
 
Joined: Oct 2004
Location: Berkshire
Posts: 360
sackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant future
Default Re: Australian Median Property Prices from 1982 to 2004

Originally Posted by ABCDiamond
It is an interesting article. The comparisons of House price to incomes actually suprised me though.
The UK is shown at about 5.8
Australia at about 4.8
Boston USA about 6.5
USA as a whole 4.2
I quoted another article here recently showing many cities in Australia at 6 x earnings, ie, much closer to the UK.
sackofspuds is offline  
Old May 11th 2005, 1:32 am
  #23  
 
Joined: Aug 2003
Posts: 11,149
bondipom is an unknown quantity at this point
Default Re: Australian Median Property Prices from 1982 to 2004

Originally Posted by ABCDiamond
It is an interesting article. The comparisons of House price to incomes actually suprised me though.
The UK is shown at about 5.8
Australia at about 4.8
Boston USA about 6.5
USA as a whole 4.2
The Sydney house price graph was a bit jerky to say the least. Those trying to draw trends from those graphs would struggle to make the current market look undervalued. I will put away my crystal ball.
bondipom is offline  
Old May 11th 2005, 2:09 am
  #24  
ABCDiamond
Guest
 
Posts: n/a
Default Re: Australian Median Property Prices from 1982 to 2004

Originally Posted by sackofspuds
I quoted another article here recently showing many cities in Australia at 6 x earnings, ie, much closer to the UK.
Ah yes, but if comparing the two, then it must either be City to City eg: London to Sydney
or Country to Country eg Australia to UK.

Comparig the most expensive cities in Australia (say 6+) to the UK average (5.8) is like comparing London (say 6+) to the Australian average (4.8) ?


However, one problem with ALL statistics is which ones do you believe ?

And when it all boils down to it, all we need to do is find out where Bondipom has put his crystal ball
 
Old May 11th 2005, 4:49 am
  #25  
Don
Banned
 
Joined: Aug 2002
Posts: 7,613
Don is an unknown quantity at this point
Default Re: Australian Median Property Prices from 1982 to 2004

Originally Posted by Megalania
So now two incomes is the norm and women's participation in the work force is approaching that of men, only increases in the general participation rate in the workforce (+productivity etc) will increase general household real incomes - rate of capital appreciation of houses will taper back to the rate of increase in participation + productivity?

In other words, increased women's participation has had a one off, generational effect of raising house prices?
Does it also mean that all those women are working for no purpose (financially)?

Ie 25 years ago one income was enough to support family and buy a home, now 2 incomes are required and the key reason is to afford the mortgage on a much higher priced house (relative to single income)? Other costs - car, food, clothing etc have generally come down in real terms but house prices have increased way beyond inflation.

No mysogyny, just a thought.
Don is offline  
Old May 11th 2005, 5:32 am
  #26  
ABCDiamond
Guest
 
Posts: n/a
Default Re: Australian Median Property Prices from 1982 to 2004

Originally Posted by Don
Does it also mean that all those women are working for no purpose (financially)?

Ie 25 years ago one income was enough to support family and buy a home, now 2 incomes are required and the key reason is to afford the mortgage on a much higher priced house (relative to single income)? Other costs - car, food, clothing etc have generally come down in real terms but house prices have increased way beyond inflation.

No mysogyny, just a thought.
Most households now have two cars, 3 or 4 TVs, Videos, DVD's, Computers, more gadgets than anyone ever thought of, plus more holidays, weekends away etc., etc, than we did around 30 years ago, when one income was sufficient
And I'm sure women only used to have a small number of shoes and handbags, not like today
 
Old May 11th 2005, 6:11 am
  #27  
Lost in BE Cyberspace
 
ozzieeagle's Avatar
 
Joined: Feb 2005
Posts: 15,526
ozzieeagle has a reputation beyond reputeozzieeagle has a reputation beyond reputeozzieeagle has a reputation beyond reputeozzieeagle has a reputation beyond reputeozzieeagle has a reputation beyond reputeozzieeagle has a reputation beyond reputeozzieeagle has a reputation beyond reputeozzieeagle has a reputation beyond reputeozzieeagle has a reputation beyond reputeozzieeagle has a reputation beyond reputeozzieeagle has a reputation beyond repute
Default Re: Australian Median Property Prices from 1982 to 2004

Originally Posted by ABCDiamond
Most households now have two cars, 3 or 4 TVs, Videos, DVD's, Computers, more gadgets than anyone ever thought of, plus more holidays, weekends away etc., etc, than we did around 30 years ago, when one income was sufficient
And I'm sure women only used to have a small number of shoes and handbags, not like today
Not to mention holiday homes, oseas trips, kids staying at home longer requiring more support.

One other factor that hasn't been mentioned, I beleive that In Japan, that house buying is carried across generations, IE: it takes two or three generations to buy a house. Now that would be hard to take.
ozzieeagle is offline  
Old May 11th 2005, 8:52 am
  #28  
BE Enthusiast
 
longreach's Avatar
 
Joined: Apr 2005
Location: Gold Coast
Posts: 493
longreach has much to be proud oflongreach has much to be proud oflongreach has much to be proud oflongreach has much to be proud oflongreach has much to be proud oflongreach has much to be proud oflongreach has much to be proud oflongreach has much to be proud oflongreach has much to be proud oflongreach has much to be proud oflongreach has much to be proud of
Default Re: Australian Median Property Prices from 1982 to 2004

Originally Posted by ABCDiamond
Some food for thought on property price changes over the years:

Median Property Prices from 1982 to 2004

Perth from $48,200 to $267,000 = 454% = 8.10% average per year
Brisbane from $55,100 to $309,000 = 461% = 8.15% average per year
Sydney from $82,600 to $471,500 = 471% = 8.24% average per year
Canberra from $59,000 to $350,000 = 493% = 8.43% average per year
Adelaide from $45,500 to $270,000 = 493% = 8.43% average per year
Melbourne from $50,500 to $382,000 = 656% = 9.63% average per year

2004 values from http://www.loan.echoice.com.au/pages...ng_market.html
1982 values from http://www.reiaustralia.com.au


If Brisbane was to catch up with Melbournes average growth over the last 22 years, the median price here should be (statistically speaking ) $416,000 :scared:
Would also be interesting to see an interest rate comparison
longreach is offline  
Old May 11th 2005, 9:00 am
  #29  
ABCDiamond
Guest
 
Posts: n/a
Default Re: Australian Median Property Prices from 1982 to 2004

Originally Posted by longreach
Would also be interesting to see an interest rate comparison
As it happens I do have a copy of the monthly Base Interest rates for about 30+ years somewhere on my hard drive, but not sure what I called it
 
Old May 11th 2005, 12:09 pm
  #30  
BE Enthusiast
 
Joined: Oct 2004
Location: Berkshire
Posts: 360
sackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant futuresackofspuds has a brilliant future
Default Re: Australian Median Property Prices from 1982 to 2004

Originally Posted by ozzieeagle
One other factor that hasn't been mentioned, I beleive that In Japan, that house buying is carried across generations, IE: it takes two or three generations to buy a house. Now that would be hard to take.
Japan also had the mother of all property crashes. You're talking falls in some places of 90%. Of course, those people who bought at the top are still lumbered with a 50 year mortage or whatever.
sackofspuds is offline  

Contact Us - Archive - Advertising - Cookie Policy - Privacy Statement - Terms of Service -

Copyright © 2024 MH Sub I, LLC dba Internet Brands. All rights reserved. Use of this site indicates your consent to the Terms of Use.