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Real Estate, time go get back in the water.

By johnboy - 13 January 2006 20

ABC Online is reporting that housing prices in the ACT have hit a three year low.

Interesting considering all those who said real estate could never depreciate.

In any event it really does seem unlikely it will drop further so time to hold our noses first home buyers.

Never mind the quality, feel the width.

What’s Your opinion?


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20 Responses to
Real Estate, time go get back in the water.
nyssa76 1:16 am 14 Jan 06

I resent Howard for a lot of things but it doesn’t encompass my life. However, those who grumble [in my experience] are usually the same people who voted for him.

Spitfire3 12:20 am 14 Jan 06

“Interesting that despite house prices having gone through the roof on Howard’s watch, there doesn’t seem to be any great resentment of him from first home buyers related to that fact.”

I am a fairly recent first home buyer and I am pretty pissed off about it.

Marco 8:43 pm 13 Jan 06

Interesting that despite house prices having gone through the roof on Howard’s watch, there doesn’t seem to be any great resentment of him from first home buyers related to that fact.

Not sure what to make of it, but I find it interesting.

I certainly don’t enjoy the thought that the house I bought as a first home buyer for $300k in 2004 went for $155k in 1999…

nyssa76 5:33 pm 13 Jan 06

Bugger being single, try having 3 children and a combined income of $100K and still can’t buy a house.

4brs are too expensive. Houses in general are too expensive – for a piece of dirt, some bricks and mortar.

I seriously doubt I will ever own a house in the ACT and am looking outsite the territory – which is a shame as I like it here.

I have a great credit rating and savings, as does hubby, but we can’t afford the $2000+ a month in a mortgage plus all our other bills. Even with the Defence forces $40K assistance, we can’t even think about it until the kids are all over 21 and even then I think it will be near impossible to buy a house.

bulldog 4:20 pm 13 Jan 06

And that’s w/o getting to involved in the cost of living. Bullshit the “affordability crisis” is over.

shauno 4:00 pm 13 Jan 06

Yep exactly If your single and want to buy a house costing say 400k you would have to save a reasonable 50k deposit snd then get a loan of 350k. To support the 2500 a month payments a nice take home pay of 6000 a month would be about right or over 115k a year pre tax.

Now if your on the average yearly income of say 52k a year your house better not cost you much more then say 200k or those morgege payments could get ugly

bulldog 3:32 pm 13 Jan 06

And by my (very) basic calculations a monthly payment of $1904 would entitle you to a loan of just under three hundred thousand dollars… Take what you will from that, but don’t tell me that the “affordability crisis” is over. Seems to me that so many of the twenty-somethings still at home will only own a house when their olds kick the bucket.

shauno 12:25 pm 13 Jan 06

“Nationally, loan repayments absorbed 27.7 per cent of average income in the December quarter, with the average monthly loan repayment falling to $1902”

So from the above figures the average monthly income is around $7000 or $84,000 a year.

I guess thats about right if you call it household income. The thing is the figures are misleading because that would be before tax.

So if you take off say an average of 30% income tax. The figure would be a more realistic $58,000 or so. That being around $4800 a month taking the “absorbed” income figure to more like 40%

The above back of the envolope calculations do not include cost of living expenses which would bring the “absorbed” income figure much higher

jr 10:58 am 13 Jan 06

Interesting to note that whilst the market is the cheapest it may have been in a long time… the price of housing is still no where what it was. Me thinks the real estate industry are attempting to drive business.

Remember kiddies interest rates are low at the moment but the Reserve bank may start to jack them up is there is too much of a surge on the housing market.

Indi 10:28 am 13 Jan 06

Bulldog – “I somehow doubt that my rates will go down. Even thought housing is in a (minor) slump, I’m sure we’ll be told that property value is still increasing.”

The value of your property (ie. land) will not necessarily go up, but the way in which rates are calculated may well. A clever little formula will be used to calculate a higher rating system without maintaining a value that should be reasonably attached to the rating system.

Most average households probably saw a drop of 15-20K off their unimproved value, but still saw a rate increase during the last round.

The strange part was that the general population showed no signs of dissatisfaction, but rather rolled over and took it.

vg 9:24 am 13 Jan 06

If people are in the market for the long term they will make money on housing. Lemezina is also the same Lemezina of Lemezina Homes. Sold my last place for a 250% profit, will sell the current one for at least 100% profit in 5 or 6 years

RandomGit 9:10 am 13 Jan 06

Im on around 60K and only scrape by on mortgage repayments and living costs because my father in law sold us his house for a fraction of it’s market value.

Indeed, kill all the real estate agents. And lawyers, also politicans. How about you and me and a big red wasteland, how does that sound?

Kandy A 8:58 am 13 Jan 06

ooh housing property has depreciated about 10 % in the last 3 years, as opposed to going UP 200% in the last 10. The best chance for real depreciation is for bird flu to wipe out significant proportions of the population, starting with real estate agents.

Heavs 8:51 am 13 Jan 06

The agents must be feeling the hurt. We looked at a place back in August and got a call from the selling agent earlier this week asking if we were still looking to buy. Guess he can’t shift those properties on his books …

bulldog 8:42 am 13 Jan 06

I somehow doubt that my rates will go down. Even thought housing is in a (minor) slump, I’m sure we’ll be told that property value is still increasing.

And where the hell do they get these statistics?
“HIA executive director Caroline Lemezina says average mortgage repayments are still high at almost 30 per cent of household incomes.”

Bullshit – certainly from where I and my friends and relatives who have bought in the last couple of years stand – the average mortgage is between forty and sixty-five percent of a houses income! Granted this is a twenty-five to thirty-five demographic, but first home buyers are finding it increasingly tough if they are a middle income earner. If you are single, or your house-hold income is below seventy-thousand dollars a year, then owning your own place is next to impossible in the current market – especially if your trying to rent in the mean-time.

I’d suggest that players thinking about buying try and ease the pain, so if that means jumping in now (provided you are in a position to afford it), don’t wait too long.

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