nicky1969

Hi All,

At last, after 9 months house sold, heading out to Perth Feb 2010, now were having seconds thoughts are we really doing the right thing? We currently live in a nice (well I think so ) 3bedroom home, only 9 years left on mtg , however looking at prices of houses similar standard to what we live in is getting me really nervous, we would be taking on a much much bigger mortgage than we have and have to take it back over 25years. Is this the norm do people really have fairly big mortgages in Aussie, would be interested to hear what the average mortgage is?. We would have to look for employment when we arrive, oh 41 teaches I.T in F.E, I 40 (next week) work as medical receptionist. My head is all over the place as it has taken hard work and waited so long for us to get the visa granted, and I know we are very fortunate to be in this position, we validated last december, and really want to give this a go, but i still have this demon playing with my head. I think it the unknown thats scary, but ill be honest its more financial reasons, then i think well if it can offer my family a better way of life then it will be worth it in the long run.

As a silent poster, we have enjoyed reading all your posts on here and have found them very useful over the time.

Any advice would be greatly appreciated

Nicky

bcworld

Aussie average new mortgage highest ever

The average figure (Jul 09) for a NEW mortagage is $354,137. Not sure if the figure for WA is available separately, but I'd expect it to be higher than the Australian average.

hereandthere

What do people expect? Australian house prices are the least affordable in the western world, and Australian interest rates are usually the highest in the western world. I live in an expensive part of Australia, but it would take ten times our joint income to get a mortgage in my district - financial suicide, in other words.

Australian houses are at least 50% overvalued and I think in many cases significantly more so. We have interest rate rises coming in Australia for the next 18 months at least, so I'm guessing, and hoping, that this will induce forced sales and bring prices down, but there are some theorising that IR rises will put houses up - UP - from today's all time high! Where will it end I wonder - $10 million for a two bedroom house?

Britain also is staring down the barrel of IR rises - I note their inflation is waking up after its deadly slumber - and this will cause untold misery in that country.

ABCDiamond

The average mortgage in Australia is actually not much different to the average UK mortgage.
Note that the average NEW mortgage is higher than the average existing mortgages:
However, your situation, going from 9 years left, to going back to 25 years, should not be classed in the average bracket.

Almost everyone goes through the phase "are we doing the right thing", so you are normal and average for that part.

This part is a difficult period for you. But at the same time you have to consider your feelings should you decide not to move over...

If house prices could stay stable in both countries, it would make that choice much easier.

swigski

There is an International yearly survey done on Housing Affordability with all the multiples, averages you could wish for.....

http://www.demographia.com/dhi.pdf

It uses the Median House price divided by the Median household income for all significant markets within a country.

The multiples are graded as

Severely Unaffordable 5.1 & Over
Seriously Unaffordable 4.1 to 5.0
Moderately Unaffordable 3.1 to 4.0
Affordable 3.0 or Less

Of the 64 severely unaffordable markets in the WORLD, 24 were in AUS. Australias 3 other areas were Seriously Unaffordable.

The Sunshine Coast (Queensland) replaced Mandurah as the nation’s most unaffordable surveyed
market, with a Median Multiple of 9.3. All markets in Australia were rated as “severely unaffordable”
except Wagga Wagga (New South Wales), Bendigo and Ballarat (Victoria), which were rated
“seriously unaffordable” (Median Multiple between 4.1 and 5.0).


In the UK, 10 areas are Severely Unaffordable and 6 seriously Unaffordable with the median of 5.2

Therefore in Australia, 88.9% of houses are severely Unaffordable and 11.1% are seriously unaffordable with a median of 6.0
In the UK, 62.5% of houses are severely unaffordable and 37.5% of houses are seriously unaffordable with a median of 5.2

hereandthere

If I recall correctly Demographia conclude that this is because of planning laws in Australia/UK versus planning laws in US/Can.

koalakim

Hi Nicky

Know how you feel!

We've been out here nearly 3 years and really want our own place now, just sold in the UK and the plan was to only have a little mortgage, however, thanks to the exchange rate we've "in theory" lost a lot of money and house prices in our area have gone up in the last year - a double whammy for us resulting in a bigger mortgage than we want and to keep the payments lower - yep extending the term.

The thing is you have to get on with life and just deal with the situation at the time - if you believe in the long run moving to Oz will be better for you then go for it. If you have some spare cash then get an offset mortgage and put your savings against it or over pay a little when you can as this knocks years off the term.

Good luck - it is scary and a big decision when you are fairly comfy in the UK but something is driving you to do it! You have to think would you look back in years and think what if..........which is what pushed us in the end!

hereandthere

You want to buy a house in this financial environment?

mindblower

[[/QUOTE]

Went through everything youv'e said, but no regrets coming here so far

Just a shock to the comfort zone....you will be fine in time.

ABCDiamond

With prices normally created by supply and demand, anyone would think that people prefer to live in Australia, after seeing those figures.

swigski

Agree, but how much more unaffordable will homes in Australia get before people like nicky think it is just not worth it and stay put.

All the sunshine in the world will not mean a thing if you have to live in a shack and struggle to make ends meet.

Keith Moon

Alright Nick,

Read my update, i know its a bit of a laugh, but some good advice. Just remember, you do not have to buy, you do not have to exchange all your cash, but getting a job is a "have to". If you can get a job, you will be fine, if not, think seriously at the moment. Australia is not moving planets, wait, i have been here for a short time, just think long and hard before you commit to anything which could have an affect on your health through the stress of making the wrong decision!

Keith

Catch

interesting reading

ABCDiamond

That is the really interesting question.

One day we may find the answer...

ABCDiamond

The Sunshine Coast is estimated to be the least affordable of 265 markets in Australia, Canada, Ireland, New Zealand, Britain and the US.

But take account of some of the possible reasons...

• The average Sunshine Coast house costs a little under $500,000, compared to Brisbane $421,000
• The Sunshine Coast has a 22% higher unemployment rate than Brisbane, with much higher part time and casual jobs, causing average wages in the area to be very low in comparison.

If property prices are compared to the wages of the people buying property, ie, mainly full time wage earners, we will see much different ratios.

Looking at WA, as the OP is looking at that area:

• Average New Australian Home Mortgage in April 2009:
  WA $387,187 equal to 4.76 times Male income of $81,276
  
• Average existing Australian Home Mortgage in April 2009:
  WA $282,800 equal to 3.48 times Male income of $81,276

Obviously if you earn half the average, then you must expect to get half the average house for your money, or pay 7 to 9 times the income ratio.