"RENTING in Canberra remains as affordable as ever" [With poll]

I earn $750 a week. I pay $430 a week rent. And I have 3 kids. Renting is the pits!

I’ve got my apartment rented at an outrageous amount, just as the market dictates, and I’m barely making a tiny profit. This place was bought at 1/3 of today’s purchase prices, so I can easily see how you could not make money renting. The only reason people get into rental properties is the expectation of future capital gain combined with some amelioration by negative gearing tax benefits.

urchin said :

RandomGit said :

I have to sell my rental property because the amount of rent I would have to charge just to cover land tax puts me out of the the market. It isn’t worth renting in Canberra compared to other states because of land tax and stamp duty. Unless you can but the property outright.

really? land tax is under 1% of the UV of the land and you can’t get that as a rental return? must be a crappy property. perhaps you have to sell because you made a bad investment decision and negative gearing hasn’t turned out to be the party you thought it would be when you’re not getting any capital gains.

+1

If you can’t turn a profit from rental properties in Canberra then there’s only one person to blame.

The return on capital received by landlords suggests that renting is the way to go. Compare the interest payments plus outgoings on the median Canberra rental versus the rent paid to live in it.

RandomGit said :

I have to sell my rental property because the amount of rent I would have to charge just to cover land tax puts me out of the the market. It isn’t worth renting in Canberra compared to other states because of land tax and stamp duty. Unless you can but the property outright.

really? land tax is under 1% of the UV of the land and you can’t get that as a rental return? must be a crappy property. perhaps you have to sell because you made a bad investment decision and negative gearing hasn’t turned out to be the party you thought it would be when you’re not getting any capital gains.

in order for the article to be of any value whatsoever they’d have to compare median rents to median renters’ income. i think you’d be looking at a very different picture if they actually did that, but obviously the point of the article is not to present accurate information but to contribute to the echo chamber and hope to convince people that housing in australia isn’t really a disaster on the verge of collapse…

I have to sell my rental property because the amount of rent I would have to charge just to cover land tax puts me out of the the market. It isn’t worth renting in Canberra compared to other states because of land tax and stamp duty. Unless you can but the property outright.

arescarti42 said :

These people make me sick.

+1

Self-serving bullshit. Mind you, it’s what they’re paid to do, but anyone who takes any notice of them deserves all they get.

I am just so glad that I am able to spend 45.83% of my income to pay off my house as opposed to this disgrace of , what, 16.72%?? I was paying over 50% not 3 years ago in rent, which is why I moved interstate for a better life [taking a valuable asset away from the nation’s capital], but came back for family reasons and still compare my mortgage to the rental rip-offs here. This is a B.S. story with B.S. figures. No point continuing with it….lost cause.

Actually the other thing from the article that made me retch was this little gem:

“Ms Lynch says that despite what is happening to economies overseas, in Australia, now is a good time to enter the market.

“There’s been 10 months straight of the cash rate staying the same,” she said. “It’s a very positive climate. You can understand the hesitation, but Australia is in a different scenario.

“We have a strong population growth, a baby boom, financially we are strong and unemployment is low. “It’s very positive.”

What world does Amanda Lynch live in? The cash rate has stayed the same for the last 10 months because it is becoming increasingly apparent that every sector of the economy except mining is going down the shitter.

Population growth is weak, down to 1.5% from 2.2% in 2008, and gee, babies are really great for the economy anyway aren’t they, what with all the houses and plasma screens they buy.

Australians have more mortgage debt now than the Americans had at the height of their bubble, unemployment is low but increasing, the US is on the verge of another recession and the EU is approaching financial Armageddon. How could anyone interpret this as a “very positive climate”.

These people make me sick.

Tetranitrate said :

random said :

Median gross income in the ACT is indeed well over $100k,

No it isn’t.
http://www.ausstats.abs.gov.au/ausstats/subscriber.nsf/0/DBE855896D8CA36DCA2578FB0018533C/$File/65230_2009-10.pdf

Spot on, you beat me to it.

I’d also like to point out that that that $104,416 gross median income figure is gross HOUSEHOLD income. The ABS data also shows that there are on average 1.5 employed persons per household, so individual gross median income is well below $100k.

Of course a lot of that income actually isn’t available to be spent, you take out tax, imputed rents and superannuation contributions and that 16.72% figure is pure bullshit.