By: hdmausguy
18/10/2009
4:55 am Yahoo! Profile:
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| gny - Why do couples in the majority of cases go out and buy themselves an expensive home usually with a small deposit and a large debt? Why don't couples start off with something less expensive and therefore much less debt? They'll take on a long term debt plan but don't seem to look at a step up plan to get something better further down the track. Some alternatives that I,ve suggested to some people have been met with horrified looks and replies. Here's some ideas I put forward with the goal to avoid the interest debt spiral.Just rent,out here in western Sydney you can rent a house for $360 - $400 pw. That's about 1/2 of a $350k mortgage repay. Set up in a residential caravan park or mobile home village. 10 - 25% of the price of an average home. Buy a house in a country town @ 1/2 the city cost. Get work in mining areas. I had a nice 4 br brick mine house for $17pw many years ago. The mining ended so it all closed down. Buy a house boat and live on a river etc rent free(yeah nice if council does'nt grab you). The main idea is to minimise your debt and maximise your savings. With a mortgage you have to keep meeting those repayments month in month out for 25 years or so. You have to encounter interest rate rises,possible unemployment,surviving on one income if/when babies come along then budgeting for the extra money absorbers. One factor I notice most people don't consider too much is that having a big mortgage impacts negatively on their long term Quality of life. If home interest rates get to 12% many many people will have already lost their home.Then they're back at square one.I did it the low debt way. With little money in the bank when 1st married, with hard work,prepared & did travel to remote areas,disiplined saving & good investments we bought a house debt free in Sydney in 8 years. Most of our friends have only just paid off their mortgage in the last few years. Admittedly because houses were much cheaper then their repays were nothing like today. |
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By: gnyakudjga
18/10/2009
2:17 am Yahoo! Profile:
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| Buying a house is the single most important step one can take. There are many advandages as there are many disadvanges which comes from doing so but the advandages do out weigh the disadvandages by far. Any change in the economy will definitely affect house buyers either positively or negatively, with the low income earners becoming vulnerable if interests rates rises. After all this is said, buying a house means securing your future.There are many ideas to follow which are like a road map for home buyers.One idea is to try to pay more than what you are supposed to pay monthly. The reason being that you will shorten the prescribed period you are supposed to pay for the house. During the ending recessional period, we saw interest rates falling to record lows. For those who were fortunate enough with there jobs not affected, it was the proper time to pay more.The list of what to do when the tough gets going for new house buyers is endless. Onother one is to lobby the the government to interfere. Above all having your house is better than renting. |
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By: guy.longshank1
17/10/2009
7:31 pm Yahoo! Profile:
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| The "Government Home Ownership Carrot" (as I believe Rodney first called it) has done nothing except cause the already over inflated pricing of Oz housing to be supported longer than it rightly should have been. Accordingly, given that our current, (and near future at least) economic conditions shall not be sufficient to in itself support such inflated values the anticipated and already overdue property crash shall occur. It is not just a question of when.. |
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By: puyi
17/10/2009
1:07 am Yahoo! Profile:
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SMH, JONATHAN CHANCELLOR
October 17, 2009
WITH the Australian dollar trading at 14-month highs against the US dollar, vendors are increasingly repatriating the proceeds of residential property sales to their offshore bank accounts.
At Artarmon the proceeds of a $530,000 two-bedroom unit sale are being repatriated to its Australian vendor living at Basle in Switzerland.
Claude Di Ciano, an agent with McGrath, said: ''He got a double bonus when he sold his investment unit at a great price, given the recent first-home owners' boost push and the strengthening of the dollar.'' |
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By: puyi
8/10/2009
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JACOB SAULWICK NATIONAL CORRESPONDENT, SMH
October 8, 2009
SINCE the previous interest rate rise in March last year, more than 225,000 households have grabbed a toehold in the housing market, forced to take on ever larger loans to do so.
The average loan taken out by a first-home buyer was worth $270,800 in August, according to the bureau's housing finance report.
The loan size was down from a peak of $287,000 in March but, in a rare event historically, it remained higher than the average home loan of $265,000 taken out by those who are not first-time borrowers.
Economists said strong growth in house prices, driven by interest among first-time buyers, probably contributed to the Reserve Bank's decision this week to raise rates by 0.25 percentage points.
In his statement explaining the decision, the Reserve Bank governor, Glenn Stevens, said house prices had ''risen appreciably'' over six months. |
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By: jaymarcel
5/10/2009
8:40 am Yahoo! Profile:
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| There are insurances for that & the percentage of people in that situation is tiny. |
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By: bewitchedfan1971@y7mail.com
1/10/2009
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| what if you became ill with acronic illness and cannot work.does this mean you shouldnt have ahome anymore.two people have to work these days to buy a house.what if your happy little bubble bursts.education isnt everything having a happy family is. |
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By: almurrie1@y7mail.com
1/10/2009
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I just had a thought that we may soon have to suffer another way of costing our rates. Councils rely exclusively on valuations continuing to go up. If they grant too many aged pensioner discounts, and also house values go down, they are faced with the double whammy of inflation sending costs up, and income going down.
Can you see where I am coming from. A tiered and yearly indexed rate, according to a set range of property values, except for those very high priced homes that actually go up.
Get ready
Al |
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By: jaymarcel
1/10/2009
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Hi puyi, At the end of the day there will always be a section of people at the bottom who can't afford a house. I don't see this time around all that much different to previous times.
If you get yourself an education & work hard you can afford a house! We all can! |
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By: puyi
1/10/2009
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ABC
Home grant boost rolled back from today
Thursday October 1, 2009
UNSW City Futures Research Centre director Bill Randolph says the boost has resulted in inflated prices.
Housing Industry Association senior economist Ben Phillips says the boost may have encouraged some buyers into the market but it has made housing affordability worse.
"So I don't think the exact impact that has on prices has been the primary concern of policy makers." |
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By: puyi
29/09/2009
7:34 pm Yahoo! Profile:
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Yahoo Finance,
Tuesday September 29, 2009
Rising house prices can hurt low income Australians and governments should keep working to stop prices rising too fast, the Reserve Bank of Australia (RBA) says.
"The risk is that we might move towards undesirably strong growth in Australian housing prices," Dr Richards said in a speech to the Committee for Economic Development of Australia (CEDA) Housing Forum in Sydney on Tuesday.
Rising house prices and rents did not necessarily make the nation any richer and left lower income households vulnerable, he said.
"Lower-income households are less likely to own housing, either their own home or an investment property, than higher-income ones," he said.
"So when the price of housing rises, higher-income households tend to benefit at the expense of lower-income households."
Dr Richards said governments need to remove more barriers - such as zoning, development approvals and transport issues - to increase the supply of dwellings to prevent an increase in house prices.
"Given that some increase in density in inevitable as the populations grow, this will put greater focus on the replacement of existing housing with higher density housing," he said.
"Nevertheless, if housing affordability is a concern, it will be necessary to keep working to reduce impediments to the construction of new housing, both inside our cities and our fringe." |
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By: puyi
29/09/2009
7:31 pm Yahoo! Profile:
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The Age,CHRIS ZAPPONE
September 29, 2009
"When the price of housing rises, higher-income households tend to benefit at the expense of lower-income households," said the head of the RBA's Economic Analysis Department, Anthony Richards.
"We are not really any richer when the price of housing rises, but the more vulnerable tend to be hurt," he told the Committee for Economic Development of Australia in Sydney today.
In the speech in which Mr Richard outlined the effects of the chronic housing shortage on the economy, he noted that a recent improvement in housing affordability was due primarily to interest rate cuts.
The weighted average for established home prices rose 4.2 per cent in the June 2009 quarter, according to the Australian Bureau of Statistics.
Elsewhere in the world, home prices have slumped in the aftermath of the global financial crisis.
The high ratio of home prices to income puts pressure on other household spending over the lifetime of a home buyers or renter, he said.
Renters are not immune to the impact of the long-run upward trend in home prices, either, Mr Richards said.
Housing stress remained "quite high" for renters in the 2007-08 financial year, as well, he said.
Also, sky-high home prices, driven by a short supply, may have "choked off some of the demand that might otherwise have existed".
The number of hours worked for Australians most likely to buy homes have jumped above 50 hours a week starting in 2005-06, which also may reflect the cost of homes.
"But, to the extent that this has boosted the price of housing, it will have contributed to some households needing to work longer hours."
Mr Richard said there is scope for further progress in relieving the housing shortage in coming years.
"The task for public policies is to help ensure that this occurs with relatively higher construction volumes and lower growth in prices, rather than vice versa." |
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By: ishtoopar
29/09/2009
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Hi Jaymarcel. It will be interesting to see what happens next time if/when interest rates rise to 9%. I say this, because there seems to be this " collective " fear floating around for the inevitable interest rate rise for some reason!
I hope Australia continues to prosper,and not to live in fear of rate rises or anything else for that matter, and steer away for the need for stimulus. |
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By: jaymarcel
29/09/2009
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Hi ishtoopar, I agree with you the sudden rise in property over the past generation or at least the last decade has been crazy & I still don't really understand why it has happened. What does seem to have been forgotten is only about 2 years ago majority of homeowners were paying interst rates of close to 9% yet prices continued to rise with few defaults.
I find it hard to believe property investors alone have created this boom, many of us are offering the mid-range rental market which mainly services people who choose to rent rather then play the mortgage/housing game. |
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By: ishtoopar
29/09/2009
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Jaymarcel. I respect your optimism. However! we only need to go back 1 generation, a few years ago, where the luxury/ choice to purchase a home was there as it is now, exept more affordable. Two generations ago, perhaps one had to save a fair chunk before being granted a loan. Perhaps we need that now, execpt for the fact that the income to " current " house price ratio, is way out of balance.
Yes house prices are continuing to rise and people are servicing these debts for the time being which is good news, due to the increase in demand, historically low interest rates, first home grants etc. Buying a house is a choice/ luxury available for most now, we are lucky in that respect. The flip side is, housing, is big business for some. Many are using/ abusing that luxury and readily available choice to buy and sell multiple properties for short term gains and over inflating the " true value ". Most just want a house to live in, to call it home, raise a family etc for a reasonable price. Todays prices are not reasonable. As I mentioned, good for some. In the long run when interest rates rise again, there will be the inevitable defaults, reduced spending, and more renting!! The need for stimulus etc. Lets just go back 1 generation, a few years ago and pretend we did not have a boom, buy a house where the income/ house price ratio was more in balance/ affordable and without too much concern for interest rates, or the need for stimulus. A fair go. Time will tell. |
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By: jaymarcel
29/09/2009
7:21 am Yahoo! Profile:
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ishtoopar, would you prefer the old system only a couple of generations back where the average man was unable to get a loan to buy his own house, stuck with renting forever, people take for granted the opportunities available today.
Buying a house is a choice/luxury that didn't always exist.
The housing market will only stop going up when people can not afford the repayments anymore & from what I can see they are still going up. |
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By: ishtoopar
27/09/2009
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| In regards to your quote " property market at its true value" Is quite frankly nonsense! True value was before the so called "resources boom", 5- 7 years ago. property prices were steadily rising and affordable for most including low income earners, as opposed to the un-precedented and unjustified rises we have seen in the last few years. Good for some, myself included , but not everyone played a part in that boom. Real wages have not increased to the same dramatic extent, there are just more high paying jobs around than before the boom. I keep referring to the boom, because it seems to be the only real reason for the current property price hikes. Housing is not not affordable, as it was for myself, my Parents,my Grandparents my Grand parents before them. $500,000 median house prices in some cities! what a joke! that was a lot of money 5- 7 years ago, it doesn't seem like much now though or does it? We live in a great Country I am proud to call home. But this unprecedented greed in the last few years is spreading like a cancer on society. Cost of living is rising every week, petrol , food etc etc. There is plenty of land, food etc etc for everyone, as there always has been in this Great country of Australia. True value is when property is affordable for all Australians, regardless of booms or not, steady rises, real wages = more spending and no need for stimulus. |
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By: puyi
26/09/2009
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PETER HAWKINS AND JONATHAN CHANCELLOR
September 26, 2009
SYDNEY'S real estate agents are anxiously gearing up for today's record 670 auction listings.
Last-ditch vendors are hoping to cash in before the boost in the first-home buyers grant ends at the end of the month.
A National Australia Bank survey found almost half of existing property owners expect prices of properties under $500,000 to fall once the higher grant finishes. |
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By: guy.longshank
14/09/2009
6:36 pm |
Message deleted. Reason: Breach of terms of service |
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By: puyi
14/09/2009
5:27 pm Yahoo! Profile:
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First-home buyers 'facing default risk'
By Matthew Franklin
The Australian
September 11, 2009
INCREASES in interest rates could push thousands of recipients of first-home buyer grants close to default, the opposition says.
"The great risk for first-home buyers next year is rising unemployment and rising interest rates at the same time," Mr Hockey said.
Federal Housing Minister Tanya Plibersek defended the scheme yesterday, saying the first-home owners boost was supporting local jobs. |
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By: puyi
14/09/2009
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AAP September 14, 2009
THE Australian dream of home ownership is slipping away, leaving a threat of a US-style collapse in house prices, according to a team of university researchers.
Analysis by researchers from South Australia's Flinders University has revealed home ownership in the 10 years from 1996 rose only 0.8 per cent despite strong economic growth and low interest rates in that period.
The Flinders Institute for Housing, Urban and Regional Research analysis found home ownership fell by 15 per cent over the two decades to 2006 for low income earners over 45 years of age and medium-high income earners under 45 years.
Other findings included large gains in national income from the resources boom were "wasted" by increasing house prices and accumulating debt to unreasonable levels.
Dr Joe Flood, the Institute's adjunct professor, said the "the writing is on the wall for the 'Australian dream'."
"The country that promised limitless land, cheap housing and near universal home ownership to all comers now has the most expensive housing in the world amid very tight housing and land markets and little prospect of restoring the balance," Dr Flood said.
"As long as the Government, the public and the media remain in denial, and self-congratulatory rhetoric continues that Australia has cleverly avoided the housing market correction it needed to have, there is little chance that matters will improve.
Dr Flood and his team assessed Census data to conclude that Australia's housing market is in "a very dangerous and unstable situation which has received little adverse attention".
"On the one hand Australia is vulnerable to a collapse like the United States, where prices fell by a half during the sub-prime collapse ... or to a long slow decline as in J apan since 1988," Dr Flood said. |
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By: jaymarcel
28/08/2009
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Hi Richard I agree its not ideal but I wonder if this will actually mean anything as their parents may also pay their mortgages through tough times so makes no difference.
Where did you read this info as usually banks look at this & put it into the equation, I know of people who tried to get a loan elsewhere first to use as their deposit but the bank refused to give them a mortgage when they looked into the account & suddenly saw a wedge of money appear.
I am doubtful of the story, probably one of these dodgy websites people on here like to send us to to justify their doom & gloom arguements, would be nice to know if its factual. |
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By: richardporthwaite
28/08/2009
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Cont from below -
Should banks be lending to people who have not even saved enough to pay for the deposit themselves? NO! The bl**dy well shouldn`t.
Nevertheless, it would appear that they are doing so.
Responsible lending.. Hummm. NOPE!! |
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By: richardporthwaite
28/08/2009
1:18 am Yahoo! Profile:
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Wow!
Just read an article which stated that 1 in 5 of the people who are stepping up to grab the stimulus money for their first home purchase are seeking to obtain the required deposit from family members...
If I am undertanding this correctly, 1 in 5 people who would otherwise not be purchasing their own home are now attempting to do so without even having enough personal savings onf their own to pay the required deposit..
Sound financial activity?
Humm.. Nope! |
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By: jaymarcel
27/08/2009
6:09 am Yahoo! Profile:
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| Nice entry luke plenty of facts & future insight, thanks. |
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