Realestate - buyers, sellers, purveyors and dreamers

[edgy]

Sydney has to have some sort of pull back, or at least stop going up you would think. Once you price your own citizens out of the market you're not far off a housing crash.

Back to the thread.... nice little apartment - only room for 8 cars :

http://www.realestate.com.au/property-apartment-nsw-darlinghurst-124658526

With the supply & demand dynamic in Sydney, I don't see how a "crash" is possible, it'll no doubt cool off and adjust in certain aspects but a crash doesn't seem plausible to me.

Call me weird, but I prefer my garage to be attached to the house... you know, for togetherness with your loved ones (the cars). 

 

[tazzieman]

I'm only entering this thread to accuse a mainlander of heinous activity, as this sort of thing doesn't happen down here.. The horrified neighbours watching this destruction have breathed in asbestos dust and are understandably not happy. I hope the razer gets the full 10 year ban , the dickhead.

http://www.abc.net.au/news/2017-02-27/anger-over-heritage-house-being-demolished/8305830

 

[LeeM]

 Wow, what an idiot! 

Imagine the red tape he's going to go through with any sort of council approvals in the future! 

 And as far as I'm aware, any company or contractors employed to carry out works on any building site that are instructed to cease work by the council, are required to do so immediately regardless of the clients wishes. They should be held accountable too

[tazzieman]

Imagine the red tape he's going to go through with any sort of council approvals in the future! 

He's in the deepest poo imaginable. And given the backstory of the most recent owner , a 97 year old Changi veteran who lived there , it's likely A Current Affair will visit. They love a property scandal.

[Blue964]

Sydney has to have some sort of pull back, or at least stop going up you would think. Once you price your own citizens out of the market you're not far off a housing crash.

Back to the thread.... nice little apartment - only room for 8 cars :

http://www.realestate.com.au/property-apartment-nsw-darlinghurst-124658526

 

Sydney clearance rates would suggest that folks are some way off being priced out.

[sleazius]

Wage growth would suggest otherwise. Just because you can loan 'x' amount doesn't mean you can afford it.

[Blue964]

Wage growth would suggest otherwise. Just because you can loan 'x' amount doesn't mean you can afford it.

have you seen any data on the Sydney mortgage default rate? I'm no property expert--but with the banks tightening lending criteria (lower LVRs), no decline in clearance rates and prices pushing higher I can't see any indicators suggesting most are being priced out. Demand is well and truely outstripping supply in Syd.

[GUT]

I hope you've all dusted off your cheque books.

Auction's on at 11am

Come on down!

I'll round you up at Dak Dak in the morning.

http://www.realestate.com.au/property-house-vic-camberwell-124638998

 

[Harvs11]

I hope you've all dusted off your cheque books.

Auction's on at 11am

Come on down!

I'll round you up at Dak Dak in the morning.

http://www.realestate.com.au/property-house-vic-camberwell-124638998

 

GLWS  If you have some buyers left wanting, send them my way  

http://www.realestate.com.au/property-house-vic-ashwood-124845206

 

[LeeM]

Wage growth would suggest otherwise. Just because you can loan 'x' amount doesn't mean you can afford it.

 It's the vibe of the thing! 

[MFX]

It will be interesting to see how the Sydney market reacts when eventually interest rates start to rise again. I think there are a huge amount of people out there cutting it very close to the wind...

That said, I don't think it will plummet, but it may 'correct' a bit.

It will be a similar thing with the P car and the classic car market in general, if/when there is another economic downturn, the toys are the first things to go...

[Harvs11]

It will be interesting to see how the Sydney market reacts when eventually interest rates start to rise again. I think there are a huge amount of people out there cutting it very close to the wind...

That said, I don't think it will plummet, but it may 'correct' a bit.

It will be a similar thing with the P car and the classic car market in general, if/when there is another economic downturn, the toys are the first things to go...

so having some cash on hand ready to scoop up a bargain from a desperate seller would be helpful. 

[MFX]

so having some cash on hand ready to scoop up a bargain from a desperate seller would be helpful. 

Doesn't Warren Buffet say something along the lines of 'buy when everyone else is selling and sell when everyone else is buying'?.

[KGB]

Doesn't Warren Buffet say something along the lines of 'buy when everyone else is selling and sell when everyone else is buying'?.

Yeah, but in both instances you've got to get as close to the "last" day as is practicable, and that's obviously his super skill.

Or maybe it's just buy a red 964 time!

[GUT]

 

the toys are the first things to go...

Nah - sell the house, keep the toy(s)!

1 down, 1 to go...

 

[firstone]

Congratulations

[SimonN]

It will be interesting to see how the Sydney market reacts when eventually interest rates start to rise again. I think there are a huge amount of people out there cutting it very close to the wind...

That said, I don't think it will plummet, but it may 'correct' a bit.

It will be a similar thing with the P car and the classic car market in general, if/when there is another economic downturn, the toys are the first things to go...

How Sydney prices perform differs greatly depending in region. For instance, at the higher end of the market, compare the eastern Suburbs with the Upper North Shore, which you would normally say are reasonably comparable, but are they......... When the downturn hits, the Eastern suburbs can lose 20% very quickly while the Upper North shore can see no change. This puzzled me for a long time. The reason turned out to be simple. It is all to do with the average level of debt. With the Upper North Shore, debt is very low and when hard times come, people aren't forced to sell in order to avoid high repayments, because they aren't making them. In the Eastern Suburbs, there is a far higher amount of debt, meaning that when rates climb and people lose jobs, they are forced to sell as they cannot service the debt. With high loan to values, a small downward move in prices panics people and you suddenly see properties going for sizeable discounts. Then everybody in the market expects to get a bargain. On the Upper North Shore, in the majority of cases, if they cannot get the price they want, they sit it out. When you own 75% or more of the equity, you have no issues borrowing money to ride it out if you have lost your job, but if you owe over 50% of the value, it's very tough.

The flip side is that you don't tend to see the same rapid growth in the Upper North Shore as you do in the Eastern Suburbs.

Other parts of Sydney have their own unique property value drivers and overall, for the size of city, it is one of the most complex markets I have come across. London was far easier to understand.

[Blue964]

How Sydney prices perform differs greatly depending in region. For instance, at the higher end of the market, compare the eastern Suburbs with the Upper North Shore, which you would normally say are reasonably comparable, but are they......... When the downturn hits, the Eastern suburbs can lose 20% very quickly while the Upper North shore can see no change. This puzzled me for a long time. The reason turned out to be simple. It is all to do with the average level of debt. With the Upper North Shore, debt is very low and when hard times come, people aren't forced to sell in order to avoid high repayments, because they aren't making them. In the Eastern Suburbs, there is a far higher amount of debt, meaning that when rates climb and people lose jobs, they are forced to sell as they cannot service the debt. With high loan to values, a small downward move in prices panics people and you suddenly see properties going for sizeable discounts. Then everybody in the market expects to get a bargain. On the Upper North Shore, in the majority of cases, if they cannot get the price they want, they sit it out. When you own 75% or more of the equity, you have no issues borrowing money to ride it out if you have lost your job, but if you owe over 50% of the value, it's very tough.

The flip side is that you don't tend to see the same rapid growth in the Upper North Shore as you do in the Eastern Suburbs.

Other parts of Sydney have their own unique property value drivers and overall, for the size of city, it is one of the most complex markets I have come across. London was far easier to understand.

I pitty the fools that own newer appartments in Sydney....with the rampant over development of appartments and large number of investors buying into those appartments, the first sign of a downturn will probably hit the appartments market hard as folks seek to offload them en masse. Mind you I remember 15 or so years ago people were calling armageddon for the Syd real estate market and I think people have been calling the end of the world for the Syd market every year since and so the cycle continues

[SimonN]

I pitty the fools that own newer appartments in Sydney....with the rampant over development of appartments and large number of investors buying into those appartments, the first sign of a downturn will probably hit the appartments market hard as folks seek to offload them en masse. Mind you I remember 15 or so years ago people were calling armageddon for the Syd real estate market and I think people have been calling the end of the world for the Syd market every year since and so the cycle continues

I am not sure I can agree with your analysis. If Sydney growth forecasts are to be believed, there still is not enough apartment development going on. having studied the figures and spoken wth the main author of the forecasts, I personally don't believe the figures. I think they are too cautious. one of the reasons why i believe Sydney prices aren't a real bubble is because the demand will remain on a long term basis. Then you look at rental occupancy rates. The almost unbelievable thing is that in places where you tgink there is over development, such as Green square/Zetland, occupancy rates are holding at record levels and again, there seems to be no let up in demand. IMO, it is more likely to go up than down as community infrastructure is built, such as the new Library precinct, swimming pool and park etc. Once the building stops, it will be even more popular.

Then you need to look at the investors. A very significant number are coming from overseas. S.E. Asian investors (mainly mainland China) are throwing money into Sydney and they have no intention of selling any time soon. For them, it is almost 'laundering" of money, getting out of mainland China and it is their insurance policy against issues with the regime. They would even leave properties empty rather than sell and they are really looking for long term (10 years plus) capital growth. Some of the developers are specifically targeting that market. You might have seen that last year, one particular developer of Chinese origins had some of the most prominent bill boards at the airport, all aimed at the overseas investors and it worked as they pre-sold their developments easily. The interesting thing has been that while developers in Melbourne and Brisbane have needed to resort to things like rental guarantees to sell apartments, we haven't seen that in Sydney where sales remain strong.

I also believe that there is a "self levelling" mechanism that goes on. If the market comes off, developers stop building and we see a shortage of rental properties which drives up rents and therefore yields which stimulates demand for new apartments. The thing which will break the cycle is if the population of Sydney stops growing. I don't see that as very likely.

 

[sandy468]

Why is Melbourne growing faster than Sydney?

Sorry to burst your bubble Simon ...

 http://www.smh.com.au/comment/why-is-melbourne-growing-faster-than-sydney-20150720-gig1sx.html

Since the 2001 census, Melbourne has added almost a million people to its population, while Sydney has attracted just over 750,000.

Choosing Melbourne and forsaking Sydney, making a difference in population growth since 2001 of more than 20,000 a year.

Melbourne is projected to become larger than Sydney somewhere between 2030 and 2050.

Melbourne 2050: How will we cope with 8 million people.

[Mike-S]

As the water authority responsible for the Fishermans Bend area of Melbourne, our board have just signed off the strategy for the area's predicted growth and it's significant. Wish I'd bought a warehouse in that zone a couple of years ago that's for sure, if it does indeed progress as planned then it'll be a vibrant residential area in the future. 

[DJM]

Then you need to look at the investors. A very significant number are coming from overseas. S.E. Asian investors (mainly mainland China) are throwing money into Sydney and they have no intention of selling any time soon. For them, it is almost 'laundering" of money, getting out of mainland China and it is their insurance policy against issues with the regime. They would even leave properties empty rather than sell and they are really looking for long term (10 years plus) capital growth.

same story in Melbourne.  O/S buyers still going crazy in Eastern suburbs, happily paying over the odds for the same reasons.  Spoken to a few agents who in earlier boom times saw 6 -7 Chinese bidding against each other and at times paying 500-750k over the best expectation. It's softened for sure and government rules around knock downs and stamp duty etc have dampened enthusiasm. But it just forces them to be more creative. 

I'm in the building business so I'm not complaining.  But it's artificially inflated for sure.  Then again, I've been expecting (predicting) a price plateau (not a crash) for 4-5 years and keep eating humble pie as we keep buying back in at ever higher prices.  We recently bought another block in Balwyn at literally double the first one we bought (same street, similar size, 4 years ago and I thought it was big $$ then!)

someone recently told me there are more millionaires in China than there are people in Australia....kind of puts it in perspective.

[sleazius]

Melbourne - you can have it. Having lived my entire life in the congested hell that is Sydney, I've got no problems with Melbourne grabbing the mantle of Australia's largest city. There is nothing attractive about it. We should be looking at developing fast transport links and creating satellite cities - not cramming more people into Sydney and Melbourne, they're big enough as it is, even on a global scale.

Sydney - 55th by population

Melbourne - 59th by population

[sandy468]

 

I wonder which O/S investors this is aimed at ...

 

 

 

 

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1.  News
2.  Victoria News MARCH 5 2017 - 6:21PM 

Vacant property tax expected to raise $80m in push to increase housing affordability

Owners who leave properties vacant will be slugged with a new tax 

The new vacant property tax rate will be 1 per cent of the property's capital-improved value rather than its overall worth. It will apply to homes that are vacant for more than a total of six months in a calendar year.

Premier Daniel Andrews said the tax would send a strong message to owners who were "effectively banking an empty property and denying that to the market".

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[LeeM]

  You can keep both! Adelaide is heading that way with congestion, though it's much better than either of those cities.

 I'm all for building new places, as it keeps me in a job (maybe!), yet no city can keep up with the urban sprawl without significant road and transport upgrades. They seem to forget that bit

 I laugh that all these studies of growth and employment that solely focus on professional jobs in the respective CBD's. S'pose the 'trendy' city café's need someone the buy their overpriced latte's!  

  Stuff city living. I like my 850sqm where I can breathe thanks