Hooray! Houses are more affordable!
Apr 20th 2009, 4:36 am
#1
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Hooray! Houses are more affordable!
Sky News had a stunning example this morning of the way that the financial geniuses who have already broken the planet, think.
The female financial correspondent was cheering the "fact" that housing is becoming more affordable at last, with interest rates at an almost alltime low.
She was blindly ignoring the facts that:
1) First time home buyers are being lured into the market by the uplifted FTHB grant.
2) Affordability has nothing whatsoever to do with interest rates - except in the very hort term. If people with marginal incomes are inveigled into a housing market they can only just afford now, they will be out of a home in a year's time when interest rates are escalating.
3) We are entering what may well be a period of well above historical unemployment rates. Many of those entering the market for the first time will be, almost by definition, among the first to lose their jobs.
Just to educate them: housing affordability is a matter of the ratio of price to income. Transient payment rates are just that - temporary.
How many of these financial whizzkids/esses could balance a household budget? Not many, by my reckoning.
The female financial correspondent was cheering the "fact" that housing is becoming more affordable at last, with interest rates at an almost alltime low.
She was blindly ignoring the facts that:
1) First time home buyers are being lured into the market by the uplifted FTHB grant.
2) Affordability has nothing whatsoever to do with interest rates - except in the very hort term. If people with marginal incomes are inveigled into a housing market they can only just afford now, they will be out of a home in a year's time when interest rates are escalating.
3) We are entering what may well be a period of well above historical unemployment rates. Many of those entering the market for the first time will be, almost by definition, among the first to lose their jobs.
Just to educate them: housing affordability is a matter of the ratio of price to income. Transient payment rates are just that - temporary.
How many of these financial whizzkids/esses could balance a household budget? Not many, by my reckoning.
Last edited by Wol; Apr 20th 2009 at 4:44 am.
Apr 20th 2009, 4:39 am
#2
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Joined: Nov 2004
Posts: 2,584
Re: Hooray! Houses are more affordable!
Sky News had a stunning example this morning of the way that the financial geniuses who have already broken the planet, think.
The female financial correspondent was cheering the "fact" that housing is becoming more affordable at last, with interest rates at an almost alltime low.
She was blindly ignoring the facts that:
1) First time home buyers are being lured into the market by the uplifted FTHB grant.
2) Affordability has nothing whatsoever to do with interest rates - except in the very hort term. If people with marginal incomes are inveigled into a housing market they can only just afford now, they will be out of a home in a year's time when interest rates are escalating.
3) We are entering what may well be a period of well above historical unemployment rates. Many of those entering the market for the first time will be, almost by definition, among the first to lose their jobs.
How many of these financial whizzkids/esses could balance a household budget? Not many, by my reckoning.
The female financial correspondent was cheering the "fact" that housing is becoming more affordable at last, with interest rates at an almost alltime low.
She was blindly ignoring the facts that:
1) First time home buyers are being lured into the market by the uplifted FTHB grant.
2) Affordability has nothing whatsoever to do with interest rates - except in the very hort term. If people with marginal incomes are inveigled into a housing market they can only just afford now, they will be out of a home in a year's time when interest rates are escalating.
3) We are entering what may well be a period of well above historical unemployment rates. Many of those entering the market for the first time will be, almost by definition, among the first to lose their jobs.
How many of these financial whizzkids/esses could balance a household budget? Not many, by my reckoning.
Apr 20th 2009, 4:41 am
#3
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Joined: Jun 2007
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Re: Hooray! Houses are more affordable!
Average house prices where I am are around $700,000! Not sure I wil jump for joy just yet.
Apr 20th 2009, 4:42 am
#4
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Joined: May 2006
Posts: 351
Re: Hooray! Houses are more affordable!
Most of these reporters are good examples of the years of excess that we have just had ie people doing jobs that they really aren't capable of. I'm looking forward to this correction.
Apr 20th 2009, 5:04 am
#5
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Re: Hooray! Houses are more affordable!
http://business.theage.com.au/busine...0419-abg8.html
Apr 20th 2009, 5:49 am
#6
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Re: Hooray! Houses are more affordable!
Another article quotes these interesting figures:
To help keep a little perspective on the average Australian home, it's worth remembering that more than 60% of households are mortgage free - even unemployment can't see a bank repossessing them.
- 80% of Australian homes are priced at less than $600,000
- The median house price is about $450,000.
- Only about 5% are priced at more than $1 million.
Apr 20th 2009, 6:54 am
#7
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Joined: Jun 2007
Location: Melbourne
Posts: 10,994
Re: Hooray! Houses are more affordable!
Another 75pct plus Auction clearance rate in Melbourne this weekend. It's entirely possible that the median has gone up over the last 3 months.
http://business.theage.com.au/busine...0419-abg8.html
http://business.theage.com.au/busine...0419-abg8.html
http://www.bigginscott.com.au/index....TOKEN=19267565
Beautiful apartment, great detail inside. Vendor bid at $410k then no-one else. Now on sale at $455k.
Apr 20th 2009, 7:22 am
#8
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Joined: Jul 2005
Posts: 310
Re: Hooray! Houses are more affordable!
2) Affordability has nothing whatsoever to do with interest rates - except in the very hort term. If people with marginal incomes are inveigled into a housing market they can only just afford now, they will be out of a home in a year's time when interest rates are escalating.
3) We are entering what may well be a period of well above historical unemployment rates. Many of those entering the market for the first time will be, almost by definition, among the first to lose their jobs.
3) We are entering what may well be a period of well above historical unemployment rates. Many of those entering the market for the first time will be, almost by definition, among the first to lose their jobs.
Apr 20th 2009, 7:28 am
#9
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Joined: Feb 2008
Location: Melbourne
Posts: 435
Re: Hooray! Houses are more affordable!
I went to this auction on Saturday:
http://www.bigginscott.com.au/index....TOKEN=19267565
Beautiful apartment, great detail inside. Vendor bid at $410k then no-one else. Now on sale at $455k.
http://www.bigginscott.com.au/index....TOKEN=19267565
Beautiful apartment, great detail inside. Vendor bid at $410k then no-one else. Now on sale at $455k.
Apr 20th 2009, 10:54 am
#11
Lost in BE Cyberspace
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Re: Hooray! Houses are more affordable!
Exactly. In a year or two's time, expect to see the Wayne and Kev show baling out thousands of defaultees. But - Heh! - what's a few billion now that we have got used to all those zeros?
Apr 20th 2009, 11:08 am
#12
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Re: Hooray! Houses are more affordable!
Thats the problem though................houses are deemed more affordable to expats. When a potting shed in England is worth a quarter of a million quid in the UK, its converted to Aussie dollars and then the run down house at the end of the nicest street in a bogan neighbourhood becomes prime real estate here in Australia. Nice for new arrivals, tough for titties for the locals.
Last edited by Officer Dibble; Apr 20th 2009 at 11:09 am. Reason: huasyfd jsjh nwkhhjd nhdjk ahdswgrkg.
Apr 20th 2009, 11:30 am
#13
Forum Regular
Joined: Apr 2009
Posts: 123
Re: Hooray! Houses are more affordable!
Sky News had a stunning example this morning of the way that the financial geniuses who have already broken the planet, think.
The female financial correspondent was cheering the "fact" that housing is becoming more affordable at last, with interest rates at an almost alltime low.
She was blindly ignoring the facts that:
1) First time home buyers are being lured into the market by the uplifted FTHB grant.
2) Affordability has nothing whatsoever to do with interest rates - except in the very hort term. If people with marginal incomes are inveigled into a housing market they can only just afford now, they will be out of a home in a year's time when interest rates are escalating.
3) We are entering what may well be a period of well above historical unemployment rates. Many of those entering the market for the first time will be, almost by definition, among the first to lose their jobs.
Just to educate them: housing affordability is a matter of the ratio of price to income. Transient payment rates are just that - temporary.
How many of these financial whizzkids/esses could balance a household budget? Not many, by my reckoning.
The female financial correspondent was cheering the "fact" that housing is becoming more affordable at last, with interest rates at an almost alltime low.
She was blindly ignoring the facts that:
1) First time home buyers are being lured into the market by the uplifted FTHB grant.
2) Affordability has nothing whatsoever to do with interest rates - except in the very hort term. If people with marginal incomes are inveigled into a housing market they can only just afford now, they will be out of a home in a year's time when interest rates are escalating.
3) We are entering what may well be a period of well above historical unemployment rates. Many of those entering the market for the first time will be, almost by definition, among the first to lose their jobs.
Just to educate them: housing affordability is a matter of the ratio of price to income. Transient payment rates are just that - temporary.
How many of these financial whizzkids/esses could balance a household budget? Not many, by my reckoning.
Apr 20th 2009, 11:35 am
#14
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Joined: Feb 2009
Posts: 3,566
Re: Hooray! Houses are more affordable!
$21,000 for new home builders
$14,000 for existing homes
$14,000 for existing homes
Apr 20th 2009, 8:49 pm
#15
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Joined: Nov 2004
Posts: 2,584
Re: Hooray! Houses are more affordable!
Thats the problem though................houses are deemed more affordable to expats. When a potting shed in England is worth a quarter of a million quid in the UK, its converted to Aussie dollars and then the run down house at the end of the nicest street in a bogan neighbourhood becomes prime real estate here in Australia. Nice for new arrivals, tough for titties for the locals.