bourbon-biscuit

We're in no position to buy at the moment and realistically we'd need the market to drop by about 25% to buy round these parts, which would obviously be awful for everyone but us if it did happen BUT if you were laying a bet- what do you think will happen to the market in NSW over the next year or two? Would you buy now?

I know it's all speculation but I've got time to kill atm ...

JAMMIE DODGER

apparently in the last recession house prices only fell approx 5% ,
supply and demand is the key,
Lots of new money coming into the country from people emmigrating and what do they spend the bulk of their cash on?.....property.

ABCDiamond

Bearing in mind that prices are already at 2002 levels, in some of the Sydney areas, I doubt they would drop much further.

With these properties getting a very healthy rental income compared to property price, they are already a good investment for property investors.

However, there are other areas, mainly the more expensive areas that I feel will still drop in price.

Devlin

Once this all shakes out (could be as long as a decade...) I think Australian house prices will be 60% less in REAL terms (i.e. adjusting for inflation)

Australia pretty much has the most overpriced housing in the world and is probably going to have the most severe recession as well. How can house prices not plummet?

ozzieeagle

I've got my eye on some Inner city property hoping.
Far easier than dealing with builders and knocking down my gaffe and putting up two big townhouses.

Theres no way in the world, that being within walking distance of the MCG and owning one of these would be a bad investment.

So fingers crossed yes please, drop prices drop...





It has to be the perfect time to change up dramatically if one can be sure of your jobs. I reckon we can.

If I can get one of these for under 800.000 I may go for it...

Jimclevs

There are, of course, very good deals to be currently had from Federal and State sources ie First Home Owner Grants etc which may not , of course, be left at this higher level forever.

...... damned if you do, damned if you don't..... as it said in this morning's Money section of the Sydney Morning Herald - might be worth your while having a read of the online version of that while its still up and available.

Jim

jad n rich

The building of new houses has almost dried up. New approvals that is, not work that was financed and approved 1 - 2 years ago, which is the stuff you can see going on now. Building materials continue to rise.

Even if prices fall somewhat, eventually the demand will bank up again, we will have headlines screaming housing shortage and up go the prices again.

Rental returns are also now better than money in the bank in many cases. If someone wants to give their property away an investor will snap it up.

I notice in the UK, prices have not fell anywhere near what I thought they might, its more a stand off between buyers and sellers, most vendors simply wont sell let alone at 60% off How many on here will sell at that, yep right

In OZ if the bank forces a sale on a property in OZ, the reserve has to be set at a valuation based on at least 3 similar properties, real sales, they dont actually accept silly offers.

Sales volume will drop even further, but prices will only go as low as vendors are prepared to take, I think like the UK it will become one big standoff , people will renovate, rent do anything before they sell their biggest asset at some fruitcake price. Lack of sales volume is already reflecting that.

northernlights

How much do these houses go for right now? Just curious -thanks!

asprilla

Well, when you consider that a couple, each earning an average of $55k, can save up e.g. $30k deposit over the course of a year or two, and then take out a loan of 3 times their income ($330k), then it makes it quite acheivable for that couple to buy a first home at approx $350k.

Average earners in their 30's, 40's, 50' s and 60's will be slowly trading up to bigger better homes in the $400k to $800k region. Then there are the top earners who will be spending even more.

I am not saying that Australian houses aren't overpriced... I agree with you on that point. All I'm saying is, when you consider the current relatively high level of wages, I can't really see how a dramatic fall will occur. A 60% fall in real terms, would mean that many earners like myself, would suddenly find themselves capable of buying some pretty top quality properties, all on their own single incomes. When something seems too good to be true - it usually is!

IndieG

I will be waiting for at least 2 years before buying - recommend the same if you're not in a hurry. I'm not going to attempt to time the market. However, would rather buy when prices are going up (on the road to recovery) rather than when they're on their way down. With all the bad news (GDP, unemployment, manufacturing...etc) coming in and the global economic crisis, don't really see prices going up anytime soon. Might as well play the waiting game....

Incidentally, I tried asking the same question at the global house crash site and got banned after making 2 posts.... They don't believe I live in Dubai and suspect I am a troll from Oz Apparently, my "IP is travelling the world"

jad n rich

There was a load of screaming and media hype that went along the lines of aussies cant afford their mortages as interest rates rose. It was intersting then that after several rate cuts, only 2% of aussies cut their mortage payment, the other 98% kept paying the higher rate. I think that shows people were not really under much housing affordability stress at all.

IndieG

They must have got locked into a fixed rate mortgage a couple of years back?

ABCDiamond

Dwelling Unit building approvals



We still have a population growth, and the need for more housing, yet the housing shortage situation is about to get much worse.

But if anyone was buying, they should be very careful on what and where they buy.

eugene43

good thread

IndieG

Notwithstanding the housing sops and interest rate cuts (not all of which has been passed on to borrowers) Aussie house prices are still extremely unaffordable in relation to income levels. People will only buy if they can afford to buy and are sure that they can service their mortgage loans.

Rising unemployement, job uncertainty...etc will probably keep buyers away from the markets for some time. Also, lenders now requiring higher downpayments will deter those trying to get on the property ladder.

More than likely that many immigrants will initially spend their cash on rents and living expenses until they find a job. And not many are lucky enough to find a job within a couple of weeks of arriving...


Or are you referring to "cashed up" migrants who have cash to buy property outright? (same story about cash buyers supporting/propping up house prices was also bandied around in Dubai - turned out to be the biggest myth ever)