freebo

This comes up a lot, I've now lived in Sydney for about 6 months so I feel a bit qualified to comment.

1) The average wage in Sydney must be way higher than the average wage in Australia as a whole.

2) Rental costs in Sydney are high, really high.

3) Property prices in relation to rental costs are even higher and can only be justified by the expectation of price rises, rental income does not cover interest. The RBA recently defined this condition as "the definition of a bubble"

So, if you're in my position you can either.

a) Buy a house using your savings

b) Buy a house using your income

c) Buy an even more expensive house using a+b

d) Rent and look on in amazement/bemusement as folk do a, or b, or c.

Despite being in a position to do a, b or c I've gone for option d, and have not even the slightest doubt that this is the right decision, I've owned houses before & will again but the Sydney market (the part I've seen, which is not all of it by any means) is IMHO a ticking time bomb and I'm happy to put away the cash I'm saving by renting. Meanwhile I'm enjoying the McMansion we're renting for a far lower outlay of the cost of servicing the interest on a loan on same.

Of course other people feel differently, maybe it really is different here, I don't think it is, neither does the IMF (among others) "you pays your money & takes your chances"

I respect ABCD's stats which he wheels out regularly, but I personally don't think I'd like to live in an averagely priced $481,000 house anywhere within commuting distance of my office in the Sydney CBD.

Wages are higher here, costs are too (maybe even more so), and (for anyone who's lived in the UK recently), Sydney is BTL mad.

And before non-Sydney folk chime in, my comments only apply to my opinion of the Sydney market, they may or may not apply elsewhere - I have no recent experience of other locations in Australia.

lapin_windstar

No - that's the average new mortgage in NSW, not Sydney.

ABCDiamond

That is the bottom line... "average".
Most people want to be above the average, and the more that manage to get above the average, then the more the average will rise even higher
And then even more will complain that the average is too high

However, there are many other people that accept being average, with average costs that they can afford.

Amazulu

Move to New York and save some money then.

ABCDiamond

That depends on your definition of Sydney.

Sydney City, I agree. Only 1 bed apartments for $310,000.

Sydney overall though... with it's size of 4,700 sq miles, and a population of 4.5 million, there is a massive variety of properties.

Steve2009

More like this:
http://www.abs.gov.au/ausstats/[email protected]/mf/6302.0
http://www.abs.gov.au/ausstats/[email protected]/mf/5609.0

ABCDiamond

August 10, 2010 - New York Wages:
And house prices in New York ?


Going on those two New York average figures... $44,600 average wage, and $656,000 average property.

However, figures for just New York, New York itself, show average wages of $62,700, although the house prices for that area may also be a little higher than State figures ?

ABCDiamond

I shall look forward to all of your posts having such clear links to back up your information then

Take this one as an example: http://britishexpats.com/forum/showp...3&postcount=98 when I even asked you where the data was from, but you didn't supply it.

freebo

Thing is, I can afford above average, with or without a mortgage but I don't see value in the market so I choose not to participate - and I'm far from the only one in this position.

Steve2009

Your comparing medians with averages if I'm not mistaken.

man_called_Horse

Not everyone buying a house in Sydney is an immigrant, some would be old money Australians who maybe have a equity of around 50-60% of the value of the property. Many made their money on the Boom in the 90's and 2005 onwards.

You are right $300K on its own will buy you SFA in Sydney but its a good lump deposit on a decent 4x2.

50,000 Pommie peso's might be a decent deposit for a house in the UK, but its only worth $80K in Oz. At the standard minimum 20% deposit that will buy you a home around $400K with a home loan of $320K.

6 or 7 years ago your £50,000 would have got you about $125,000 and still at minimum 20% you could probably afford a house at $625K. That same house worth $625K is probably worth $800K now. So if you sold that house now you would have equity worth $300K.

ABCDiamond

Lets see the three figures I showed:

• average house listing $656,615
• median weekly income $858 earned by men ie: $44,600
• Average wages $62,700 (not median)

Difficult to compare exactly, but a general picture is shown.

ABCDiamond

I saw that when we decided to move up to QLD

freebo

There are places outside of Sydney which seem to stack up a lot better, but Sydney's where my work is right now so I'll keep putting away the pennies & see how things develop

Steve2009

Your third figure is for a different population than the second. They are not comparable. You have an average house price for one set, a median for one set and an average for one set. I think you tried to compare a median from one set to the average for a different set. It's all over the place to be honest.