Melbourne Property Market

[Brad Goodman]

Some people resent others getting ahead.

Kernel of truth to that. I don't want to have to get married to buy a house!

 

[Z_K]

You should have a good hard look at yourself. It's unhealthy to resent other people's success.

Huh? I'm 27 and am just about to buy again after buying in at 23. I didn't do anything remarkable and am actually a bit embarrassed by my relative success in property. It's been through no great management on my part, but it looks likely to have set my family up.

So, despite me likely having 3 properties by 30 and seeing my parents houses up to about a million each in this boom, I think prices are too high, too restrictive and cutting too many families way to close to the edge. Just because I will benefit greatly doesn't mean I sit back and not concern myself with what these ridiculous prices and this completely un-sustainable rise will have on those looking and those buying into a potential financial death trap.

 

[Clay Davis]

Don't worry, if things start to go pear shaped, bunsen will disappear from this forum.

 

[bunsen burner]

Nope, its the people like that Carmel lady from the Apprentice who was living it up in her mansion with her fancy car and such, all on borrowed money, that are greedy.

And there are too many out there like that.

You didn't address the point. Why did you bother replying? It would have been easier to say "I am resentful too". Or "I am so short sighted that when I see an idiot on TV I associate that with the majority of Australian Mum and Dad property investors".

 

[bunsen burner]

Don't worry, if things start to go pear shaped, bunsen will disappear from this forum.

unlikely.

 

[bunsen burner]

Huh? I'm 27 and am just about to buy again after buying in at 23. I didn't do anything remarkable and am actually a bit embarrassed by my relative success in property. It's been through no great management on my part, but it looks likely to have set my family up.

So, despite me likely having 3 properties by 30 and seeing my parents houses up to about a million each in this boom, I think prices are too high, too restrictive and cutting too many families way to close to the edge. Just because I will benefit greatly doesn't mean I sit back and not concern myself with what these ridiculous prices and this completely un-sustainable rise will have on those looking and those buying into a potential financial death trap.

I see. "Potential death trap" yet you are going in and buying? Do you have a split personality? How do you manage to balane the ledger here? You seem to be having a bet each way.

 

[Clay Davis]

unlikely.

I'd say quite likely. You have form.

 

[Lyyynnnchy]

I see. "Potential death trap" yet you are going in and buying? Do you have a split personality? How do you manage to balane the ledger here? You seem to be having a bet each way.

There is a "smart buy" and a "bad buy"

I'd say NorthBhoy is looking at buying a cf + property, one that is cf- but undervalued or one that is cf- and has significant room for capital growth. Many people don't look to the future and just by what they see seems like good value now.

My friend and his gf just paid $420,000 (95% loan) for a 3 bed 1 bath house 25 - 30ks from Perth with no ammenities close by that would rent for $300 - $350 a week. Has a big block and plenty of room for his 2 dogs and a pool table, big block is ok but it's to far from the city and not even close to a train station...If house prices fall that is a death trap

A cf+ house/apartment/townhouse within 10ks of the city and walking distance to a train station is a good buy anytime. If house prices fall these types of dwellings would fall in price the least, if your holding for 5+ years then you cant go wrong

You need to make sure you can still pay for your mortgage/s if interest rates reach 10%

I am talking from a Perth point of view

 

[Z_K]

I see. "Potential death trap" yet you are going in and buying? Do you have a split personality? How do you manage to balane the ledger here? You seem to be having a bet each way.

Not sure why you're angling for an argument, but very simply, I can afford it. I don't need to borrow from parents or ask them put up their joint for assistance. If rates went up 4% and my missus stopped working, we could still service our loan and then some.

As it stands, we have two very good incomes (she could double her weekly take home easily and will in the run up to the next buy) and not much else to spend money on. I have a fair idea on where we'll buy next and I think we'll do well. We might not, too. 13km's from the city is my limit ATM, must be near a train or tram line, infrastructure planned and committed to is an added bonus. If forced to buy in right now, it would be Fawkner, Hadfield, Glenroy. Biggest impediment for the first two is the shitness of the established housing, but it ticks every other box. Hadfield has some enormous blocks of land going. All 3 are undervalued. Coburg, Brunswick, Northcote, Preston will continue to grow but have, IMO, gone past being absolute musts.

I think the current housing climate has the potential to create a large group of working poor and physically stranded families living on the edge every month in s**t "suburbs" of Melbourne. This has huge social implications, even forgetting for a moment the obvious financial knock on effects.

 

[Tonche]

You didn't address the point. Why did you bother replying? It would have been easier to say "I am resentful too". Or "I am so short sighted that when I see an idiot on TV I associate that with the majority of Australian Mum and Dad property investors".

Are you telling me that there aren't a ton of people out there who are living beyond their means?

Referring to both owner/occupiers stretching their budgets and investors leveraged to the hilt.

Come off it.

 

[Brad Goodman]

I have 80k for a deposit and an annual salary 60k yet consider myself incapable of servicing a mortgage. I'm certain there are people in worse situations than me who are in over their heads.

 

[bunsen burner]

I'd say quite likely. You have form.

In your deluded mind, yes. You guys said the maret would drop 30-40%. It dropped 5%. I said it was at the bottom of the downturn and I wasn't far off. I didn't come here for 6 months. So what? There wsnthing to talk about. Had someone started a property thred I most likely would ave.

 

[bunsen burner]

There is a "smart buy" and a "bad buy"

I'd say NorthBhoy is looking at buying a cf + property, one that is cf- but undervalued or one that is cf- and has significant room for capital growth. Many people don't look to the future and just by what they see seems like good value now.

Unfortunately Nothbhoy is not talking about good deals and bad deal. e's having a stab at property investors and the market in general but then is going out and buying property. His actions and his opinions don't reconcile.

 

[bunsen burner]

Not sure why you're angling for an argument, but very simply, I can afford it. I don't need to borrow from parents or ask them put up their joint for assistance. If rates went up 4% and my missus stopped working, we could still service our loan and then some.

As it stands, we have two very good incomes (she could double her weekly take home easily and will in the run up to the next buy) and not much else to spend money on. I have a fair idea on where we'll buy next and I think we'll do well. We might not, too. 13km's from the city is my limit ATM, must be near a train or tram line, infrastructure planned and committed to is an added bonus. If forced to buy in right now, it would be Fawkner, Hadfield, Glenroy. Biggest impediment for the first two is the shitness of the established housing, but it ticks every other box. Hadfield has some enormous blocks of land going. All 3 are undervalued. Coburg, Brunswick, Northcote, Preston will continue to grow but have, IMO, gone past being absolute musts.

I think the current housing climate has the potential to create a large group of working poor and physically stranded families living on the edge every month in s**t "suburbs" of Melbourne. This has huge social implications, even forgetting for a moment the obvious financial knock on effects.

Actually champ, you said this:

I think prices are too high, too restrictive and cutting too many families way to close to the edge. Just because I will benefit greatly doesn't mean I sit back and not concern myself with what these ridiculous prices and this completely un-sustainable rise will have on those looking and those buying into a potential financial death trap.

On one hand you think prices are too hgh and unsustainable yet you are buying a property?

Do you want to try again?

 

[bunsen burner]

Are you telling me that there aren't a ton of people out there who are living beyond their means?

Referring to both owner/occupiers stretching their budgets and investors leveraged to the hilt.

Come off it.

Sure there's people living beyond their means but that doesn't equate to this comment that you wholeheartedly agreed with:

but Australians are greedy and ****ing stupid

I think it's you who needs to put the cack pipe down.

 

[Papa G]

Actually champ, you said this:



On one hand you think prices are too hgh and unsustainable yet you are buying a property?

Do you want to try again?

.....And indeed fuelling and profiteering from the same property/housing climate he claims to be so detrimental to social fabric of the country and creating a working poor underclass.

 

[bunsen burner]

I have 80k for a deposit and an annual salary 60k yet consider myself incapable of servicing a mortgage.

Then you need to do your figures again or get creative. That is plenty.

tHere is a random property I picked out. Did' even search for anything more suitable

http://www.realestate.com.au/cgi-bi...r=&cc=&c=19685925&s=vic&snf=rbs&tm=1256531908

Purchase price + stamp + buyng costs = $400k

$80K deposit
$320k loan
Interest repayments @ 9% = $29k
Rates, insuance, strata = $2k
Rent for second bedroom @ $180pw = $9360

Cost to hold pa = $21640 = $416pw

Don't forget rates right now at about 6%.

I'm certain there are people in worse situations than me who are in over their heads.

And?

 

[Brad Goodman]

I would not live there. Far too small. Either way I'm not willing to put more than a third of my weekly disposable income towards it (this currently = $300p.w). A guy my age used to be able to pay off a house and still have a life. Not anymore.

Aren't all those people with less financial comfort than me yet still in the market living beyond their means? How are they going to be if we go up another 3 percentage points in not much time? If they have to get out then they shouldn't have been in in the first place...

 

[Clay Davis]

In your deluded mind, yes. You guys said the maret would drop 30-40%.

Where did I say that?

It dropped 5%. I said it was at the bottom of the downturn and I wasn't far off.

Ha. Already documented earlier in this thread, but if you want to believe that you did, then fair enough.

I didn't come here for 6 months. So what? There wsnthing to talk about. Had someone started a property thred I most likely would ave.

Try a year. There were plenty of property threads. You were relatively absent from this one during the period which prices were falling. Funnily enough, you've dug up material from that thread to use for the OP in this thread one a year later.

Why weren't you on the front foot back then, like you are now?

 

[Clay Davis]

.....And indeed fuelling and profiteering from the same property/housing climate he claims to be so detrimental to social fabric of the country and creating a working poor underclass.

No point being quixotic about it. If the government's going to load the dice such that always falls the way of the property owners, then why take a moral stand? Doesn't mean it's right though.

 

[bunsen burner]

I would not live there. Far too small.

Then you can go get a bigger place further out. But it looks like you're determined to argue it's not possible and then blame everyone else for why they have a hou/unit and you don't

Either way I'm not willing to put more than a third of my weekly disposable income towards it (this currently = $300p.w).

That is your choice. But if you make htchoice you shouldn'tbe resenting others who do.

A guy my age used to be able to pay off a house and still have a life. Not anymore.

"Life is so tough, waaaah, waaaaah waaaaah"

Aren't all those people with less financial comfort than me yet still in the market living beyond their means?

Nope. It typically takes sacrifice and short term pain to get into the market. That often ans moving to undesiable areas or rnting a room or two out to cover the repayments, or scrimping on spending.

Obviously you're not mature enough accept that this is how it is and how it's going to be.

How are they going to be if we go up another 3 percentage points in not much time? If they have to get out then they shouldn't have been in in the first place...

Why are youso worried about everybody else?

 

[Papa G]

No point being quixotic about it. If the government's going to load the dice such that always falls the way of the property owners, then why take a moral stand? Doesn't mean it's right though.

..... umm so it's okay to take advantage of something for personal gain whilst being disgusted by it and knowing/arguing about it's wrongness at the same time? Seems like the eternal internal struggle left wing politicians and highly paid public servants have to deal with everyday.

 

[Clay Davis]

..... umm so it's okay to take advantage of something for personal gain whilst being disgusted by it and knowing/arguing about it's wrongness at the same time?

Of course it is. In the long run, your only duty is to yourself and your family. That doesn't make it right for the govt to manipulate markets for the benefit of a certain group of people.

Seems like the eternal internal struggle left wing politicians and highly paid public servants have to deal with everyday.

For someone who is nominally right-wing, you seem quite happy with the government intervening on your behalf. You should be puckering up for Rudd.

 

[Brad Goodman]

Then you can go get a bigger place further out. But it looks like you're determined to argue it's not possible and then blame everyone else for why they have a hou/unit and you don't

That is your choice. But if you make htchoice you shouldn'tbe resenting others who do.

These comments are fair. Although I wouldn't say I resent those who do, I resent the fact that they need to extend themselves so much for something (property ownership) I believe should be a entitlement, not a privilege or something you have to pay through the teeth for.

"Life is so tough, waaaah, waaaaah waaaaah"

From what I can tell my input in this thread is contributing to a discussion, not having an argument (there is a difference), so was that antagonism really necessary? Again though I will concede a kernel of truth in what you said.

Nope. It typically takes sacrifice and short term pain to get into the market. That often ans moving to undesiable areas or rnting a room or two out to cover the repayments, or scrimping on spending.

Obviously you're not mature enough accept that this is how it is and how it's going to be.

I'm still young so I'm not 100% certain but have things always been this way? I'm guessing it was only when residential property became a widespread form of personal investment, but happy to be corrected on that one.

Why are you so worried about everybody else?

I don't consider myself socialist, but I probably have a socialist view with regards to residential property? I think you should be able to afford to own a house as easily as you can afford to buy groceries at the supermarket.

Thinking out loud here, but perhaps I should just face facts and move with the times...

 

[Z_K]

Actually champ, you said this

:

Champ?

On one hand you think prices are too hgh and unsustainable yet you are buying a property?

I was thinking about it, yeah. I'm in no rush to, but it one comes along in a suburb I think still relatively well priced I will have a crack.

Do you want to try again?

I think the majority of houses sold are overvalued right now. Whether it will continue to ascend or fall in the arse I don't know, but I think there are some areas in Melbourne which still interest me and would have me thinking about buying. Most I wouldn't go near. Not even close.

Your confusion confuses me.