pogsy

With interest rates on the move at the moment what would any Oz residents recommend, buy now or wait and see if property prices fall. We will be moving to NSW in November this year and are not sure if we should buy when we arrive or rent and wait to buy later. Any thoughts on this.

woogle

We came in Feb & rented for 6 months,just to get things sorted out & get to know the area, as we'd never been before.
We started to look for houses 2 months ago & bought after only seeing about 5 properties, as we just fell in love with the house . We move in next month. The interest rates are supposed to be going up again soon, so I'm hoping we're in the house before they do. Don't know about NSW, but around here the houses sell within a few weeks,a lot are sold even before Inspection day. So I felt happier buying ASAP rather than do another 6 months rent,which is dead money, and I would have been watching prices getting even higher :scared:

Tom Sawyer

Not too sure at the momment. We have been looking in Sydney for 15 months and still have not bought. In general the houses are very overpriced. Got talking to the agent who is selling the place we rent last weekend and his words were "the market has collapsed, nobody selling, nobody buying". To back this up he told there is 15 agents in the area where we live and they sold 6 houses between them in July and I'd guess there is about 150 - 200 properties for sale. I would think after a collapse comes the price crash. He also said that they cannot persuade vendors to lower their prices, they still believe they can get the same price as they did 2 years ago, and we have personal experience of dealing with a vendor with that attitude. I know of lots of houses that have been for sale for 6 months + at the same price and when you enquire with the agent if the vendor would negotiate / consider lowering their price, they say no.
I think a few chickens are coming home to roost, agents set the prices and they ramped them up excessively when the market was good, and now cannot get back to a realistic, affordable level. So maybe a wait and see what happens after the next rate rise. Mass panic?

thebears

To add if the market is so hot as agents claim why are they offering
Carpets
$1500 worth of petrol
drapes
landscaping
A number of free plan alterations
etc

On new homes?

If houses were going like hot cakes as some agents would have you believe would they need all of these sweetners? and why are I getting so many calls from agents from details I left 4 months ago?

moneypenny20

Regardless of interest rates and property prices, most sensible people (not us ) rent for at least six months to make sure they know what area they want to buy in as you should have lots of visits to various areas at different times to make sure you get it right.

pogsy

The only thing putting us of renting is the prospect of unpacking the contents of our house and life then repacking it all again when we were to buy six or twelve months later. If you were to get a removal company in what is the likely cost of a move from rented to purchased house assuming you were pretty accurate with the area you were renting in and then subsequently purchasing (meaning the move was not to far). Add this cost to the rental price and it can add up to being quite an expence when you compare it to purchasing straight off.

spottydog

We rented for the first few months before buying and I'm glad we did. We stayed with friends in the Shire when we first got here, then rented in Balmian but quickly decided that Balmain was just too city for us and the Shire was where we wanted to live long term.

We bought our place in the Shire about 3 months ago. Places down here seem to be selling if they're correctly priced but ones that are overpriced are sitting there often for many months then changing agent and selling immediately as they are correctly priced with the new agent (Ours was dropped about $60k between agents with about a 6 month gap between advertising).

I would certainly say rent first to check where you want to buy as I don't think that prices are going to be rising massively in Sydney and are more likely to drop. Then find somewhere and buy your home and if it's really your home even if prices drop you'll be happy where you are and won't worry (as house prices only really matter when you're buying of selling, the rest of the time its just numbers and newspaper articles)

thebears

Your talking pennies where as you should be more concerned with pounds mate.

Put it in storage for $13 per week. You check out the difference of rent versus interest payments - rent in smaller place ie 2 bed instead of 4 bed for 6 months.
Dont underestimate the costs in buying (have you checked out the cost of stamp duty? get it wrong and buying again in 5 years is equivalent to 12 months rent just on this)

nfernand

Yep, Prices must come down. NSW prices are over valued. Rent money is not dead money. If you buy a house you pay most to the bank. Also, rental return is 4% and interest rates are 7%. Saving of 3%.

PS/ For the past 15 months I am on rent in Syd likewise my property in Lon is on rent. Planning to buy a property in NSW early next yr hopefully by then prices have crashed

pogsy

OK thanks to everyone for their input, I guess if we were to put all our money in a good interest bearing account then the interest may pay for the rent each week and it gives us the opportunity to take advantage of the maybe lowering prices.

thebears

You should be getting at least 6.10%

pogsy

Thanks for that I will start to check out the best rates avaliable.

touchingcloth

Bank of Western Australia offer a 12 month introuctory rate of 6.6%

steve`o

at those rates the proceeds from a house sale in the uk
lodged in a high intrest account will pay the rent out of the monthly intrest it makes

ginaf

From this morning's SMH

http://www.smh.com.au/news/national/...012414995.html

It is going to be 2 years before we buy a house in Sydney and I am glad we have that long to wait. Interest rates are set to rise by at least another .25% by the end of this year and likely to continue to rise further. I would keep your money in the bank for a while.