stef

I totally agree. You could spend a fortune in renting just waiting to see if house investments rise or fall. Sometimes you just have to take the bull by the horns and do it. Try and find an up and coming area, but most importantly somewhere youd like to live and then sod it. If prices fall they fall. So long as your where you want to be then hey its better than the uk. Even debt is easier to take when the sun shines.

Melchels

Yes, I agree that you must not over commit yourself to a mortgage that you cannot handle, but if you can 'afford' to buy, it is a better option....

ossigeno

I agree with buying but not at the peak of an over-inflated market.

20k?, that's about 5% on the average Australian property. More like 20% in the next 12-18 months. With more to follow.

It will recover at some point but there is the opportunity cost associated with buying at the wrong time. A lot of people cannot see this.

jad n rich

Study all factors of buying not just one sensational article, did Mr Symonds mention in 2006 building costs will rise at least $20,000 in many areas just to cover new builidng regulations, codes and requirements, and land development costs will rise approx $14,000 a block

merlotsmum

Sorry to bring this one up again but I am so confused, at the earliest we will be in a position to buy in Australia in early 2007 (if we return in Sept 2006), I am assuming that many of you are renting as you feel prices have peaked in Oz and may go down?????

biggy

I cant see prices going down...they may level out, but then again they may rise, you just dont know!!!!

I do know that the cost of building has increased horrendously over the last few years......my mate built a house here in 2003......the land they bought they would now pay almost $200k more for and the price of building the same house has gone up by a staggering $100k plus.

We wanted to build a two storey house, but because of all the changes in health and safety regulations regarding scaffolding and the public liabity insurance premiums going thro the roof for these suppliers, the bill for the scaffolding alone would be going on $50k

Aparently the price of concrete is also through the roof.....mostly due to rising fuel costs and also water shortages and the need for the supplier to pay for excess water all adds to the increasing costs.

IMHO you cant put buying a house on hold just to see if the prices come down. Yes rent initially to make sure you likr the area etc etc. Renting is a total waste of money if you intend to buy....you are looking at at 'least' $12,000 a year for a decent rental......5 years renting $60,000 thats almost half my mortgage paid.

ginaf

http://www.qbr.com.au/index.cfm?stor...splaystory.cfm

http://www.bloomberg.com/apps/news?p...d=ajS6P0DDhxcY

http://www.theadvertiser.news.com.au...5E2682,00.html

http://firstrung.co.uk/articles.asp?...articlekey=901

ABCDiamond

and from ABS
Sept 2005

Quarterly Changes
Preliminary estimates show the price index for established houses in Australia fell 1.0% in the September quarter 2005, compared with an increase of 0.7% in the June quarter 2005.
House prices fell in Hobart (-3.0%), Sydney (-2.3%), Melbourne (-1.5%), Brisbane (-0.9%) and Canberra (-0.2%) and rose in Darwin (+7.7%), Perth (+3.1%) and Adelaide (+0.7%).

Annual Changes (September quarter 2004 to September quarter 2005)
Over the twelve months to September quarter 2005, preliminary estimates show that established house prices rose 1.0%.
Annually, house prices rose in Darwin (+21.9%), Perth (+17.7%), Adelaide (+4.2%), Brisbane (+2.9%), Hobart (+2.9%), Canberra (+2.4%) and Melbourne (+1.4%). House prices fell in Sydney by 4.7%.


and
Wednesday, 16 November 2005. 10:48 (AEST) ABC News
Burke Shire experiences strong property prices.
An influx in tourist numbers, city residents seeking a sea change and a shortage of freehold land has led to a boom in property prices in Burke Shire. (where ? )

and
28 November 2005 Infochoice
Macquarie Bank expects house prices to remain stable in Sydney and Melbourne for the next two to three years.


and
November 24, 2005 The Australian
THE Sydney apartment market has hit the bottom, Melbourne could battle oversupply for some time and there is renewed vigour in the Brisbane market,
(I agree with that last bit, with the number of buyers around in the last few weeks)

Melbourne prices rose first, followed by Sydney, and then Brisbane (not sure about other states), then Melbourne dropped first, followed by Sydney and then Brisbane....

bondipom

Access economics also reports stagnant house prices in Sydney for at least 3 years. Australia also has the worlds highest differential between rent and house prices indicating an underlying overvaluation. Access economics estimated this overvaluation at 10% with Sydney the hardest hit due to Sydney having the biggest initial bubble. Perth and Darwin are riding the resources boom which is proving to be a double edged sword for Australia's exporting industries or those competing with importers. Car parts is particularly badly hit but other industries are also hurting. High energy prices are also acting as a defacto interest rate rise.

No one is talking of interest rate cuts at the moment and all the talk is of rises in the new year.

For a 5 year return savings accounts offer a much less risky option for as more reward.

Buying for somewhere to live is a different matter however I wouldn't be in a rush and biding ones time to buy the right place at the right price is probably the best tactic. Anyone coming here would do well to rent for 6 months to learn the local market and assess where to live.

merlotsmum

Thanks for the links and feedback, off to open an ING Direct account I think

ossigeno

This is UK house prices, however if anything Australian house prices are in a more vunerable condition. Smart money is buying below the long term trend. Historically after each boom prices have always dropped below the long term.

Of course some people say ".. we are buying now for x years when prices will have recovered.." no doubt this is true but there are the opportunity costs associated with buying at the peak. Paying excess mortgage interest for those years whilst waiting for the recovery and the lost opportunity to buy a bigger house for the same money if they had timed the purchase better.

BadgeIsBack

Buy for the long term. True. If you can afford your mortgage, and I mean, really afford - if you're at all worried about it then you can't afford it - then I'd buy.
Problem is, only cashed up Poms can probably afford it.

ginaf

I personally think you are doing the right thing, my husband deals in risky investments (using other peoples money!), and even he believes the best place for your money is in ING!

jackie

Great thread linda totally agree rent , rent , rent no debt for us for a change will bank our money in high interest account and buy when time is right.
Have fun and enjoy your new life
jackie

bri.thomson

Great thread.
Both sides of the equation makes sense, but every individuals circumstance dictates what anyone will do.

Someone HAS TO BUY the property or there would be no places to rent?

I cannot believe that people are renting out at a loss, if they are the rental wont last for long.
Renters beware!!
If interest rates rise, so will rents- simple economics.
If values drop the rental still keeps coming in, so nothing lost for the land lords and long term they will recover(always have and most probably always will)
So rental money is dead money, no return whats so ever.
Yes no capital outlay to begin with, but you have to make sure the pot is deep enough!

Buying a property has got to be the best long term saving policy available to all of us. I have never heard of anyone who has put their money into bricks and mortar for long term being left without anything.

If anyone knows where and when the market will bottom out please give me 6 Nos for Saturday. Its all speculation and I guess in the long run it's up to you.
If you like a house, then make it Your Home and in the end the value is to you and you alone, if it is an investment you are looking for stick yer money in the bank and hope the interest rate you get covers your rent.

Only my thoughts of course.