| Housing Affordability
Posted: 3/31/2008 3:29:09 AM | yeah yeah I searched, but didn't find one in this forum. So........
Given the current housing climate, how are people coping (or not?).
Hows interest rates, for those paying off their home, affected you if at all.
And for those who already own their home outright, do you find the interest rates affecting you at all?
And what have you had to sacrifice?
Personally, I'm a renter/boarder. Trying to save for a home, though somehow I'm starting to think it's a frivolous endeavour. | |
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| Housing Affordability
Posted: 3/31/2008 4:03:00 AM | Yep I rent and unless house prices come back down to 150K or I become the CEO of the Commonwealth Bank I wont be buying a house anytime soon. But at least on the bright side, if the world decends into chaos and it becomes an everyman for himself doomsday situation I wont have to worry about losing my house!! | |
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TLC_
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Joined: 1/26/2008
Msg: 3 | |
| Housing Affordability
Posted: 3/31/2008 4:18:14 AM | the federal government need to take over all banks and stop the shareholder parasites living off the backs of the people.
sure have an intrest, but there is no need for it to be so high, 1 or 2 percent is quite adequate | |
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| Housing Affordability
Posted: 3/31/2008 5:56:39 AM | There you go - someone who wants the government to fix everything. You're living in the wrong country - perhaps you should try one of those failed centrally controlled economies: Mexico, Zimbabwe, Argentina, or the classic communist models. Or maybe you were being sarcastically rhetorical.
Facts are that in Australia, housing has increased over the last 100 years at around 7% annually. Strangely enough, the stock market has a long term growth rate of about 7% annually as well (in the USA, this is based on 150 years of recorded growth). No one seems to know why it works out at this rate, but you can't ignore reality. Then add one or two percent for the banks' margin.
That means that interest rates today are still below historical averages. But did anyone ever think that interest rates would never go up after reaching 40 year lows only two years ago? | |
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| Housing Affordability
Posted: 3/31/2008 6:04:45 AM | | Rentals in my area are hard to get, there is often 20 people applying for the one property, and rental bidding wars are not uncommon. Prices are rediculous. I pay 50% of my incoming out in rent.............. I'm sure I'm not alone there . God help you if you have pets, as 9 out of every 10 properties available, don't allow them. | |
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| Housing Affordability
Posted: 3/31/2008 6:05:33 AM | I dont think interest rates are the problem for home owners.... housing prices have been pushed up by speculating investors who get a tax break on their interest payments for investing in real estate..
so get this..... the person who owns their own home cant claim the interest on their tax form but a speculating investor can claim it, because they are supposedly making an income from the property...when in fact , they structure the investment so that it loses money and they can get a tax break and get some idiot to pay off their investment - the person who rents..
guess who controls the tax laws...... the government...
and yes, hawke and keating got rid of negative gearing for a few months back in the 80s because it is so unfair but all the investors took their money out of property and there was a shortage of rentals...now if we put up with the short term pain at that time, we wouldnt have had the huge glut of speculative property money in the market in the last 20 years pushing up house prices.. | |
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TLC_
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Joined: 1/26/2008
Msg: 7 | |
| Housing Affordability
Posted: 3/31/2008 6:05:39 AM | interest rates are just a way a few $crew the people.
the wages of the bank staff dont go up with rises in intrest, the wages of those working in oil refineries havent gone up with the price of oil, so whos pocketing all our money, just a few stuffed shirts that wouldnt know a days work if it hit them in the face.
and dont confuse what communism became with the true ideals of the communism | |
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| Housing Affordability
Posted: 3/31/2008 6:13:26 AM | | I proudly rent and can't see myself living to 105 to pay off a reasonable mortgage. | |
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| Housing Affordability
Posted: 3/31/2008 6:13:58 AM | Here in Perth we are having some problems because of several factors fuelling inflation, including a housing shortage. What concerns me is the vulnerable in society being hit by rising rents and other costs, especially the mentally ill, the elderly, and the poor. While the housing crisis here has its roots in government incompetence, the mining boom and its very uneven fruits are also much to blame as well. West Australians are amoung the richest in the nation, but according to a story I read, gave the least to charities. I am especially concerned with the rising numbers of homeless, which aggravates various social problems, including crime.
The government and the private sector need to work hand in hand in the most efficient way to ensure housing remains affordable, especially for the marginalised in society. | |
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| Housing Affordability
Posted: 3/31/2008 6:21:39 AM | Perhaps TLC you really don't understand today's economy. There are no them and us. Most companies are publically listed - that means they are owned by their shareholders. That means people who invest in shares.
I don't say that our modern economic theories are perfect - far from it (mainly because of their total inability to consider the non-economic impact of free goods like clean air that factories polute, fresh water that we pour our waste products into, topsoil that our farming methods destroy with overproduction, etc). However, it is about wealth creation, standard of living and a measure of the general state of happiness of our citizens.
Communism just misses the entire point, because it doesn't attempt to raise the bar, but lowers the boom to the lowest common denominator. | |
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pedro!
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Joined: 9/22/2007
Msg: 11 | |
| Housing Affordability
Posted: 3/31/2008 6:35:42 AM | | Ten years ago I was on the bones of my butt and had a few strokes of fortune to the tune of about $140k which I used to buy a house outright in Townsville. I have since bought and sold twice, have always rented a room out and have now about $350k equity in my current and am in the process of subdivision which, if all goes to plan will knock off my remaining mortgage. I've been lucky but I've also tried to be shrewd in my wheeling and dealing - I painstakingly research real estate values and growth patterns and recently fixed my mortgage repayments for four years. I'm not quite in the "mortgage stress" category but manage to live fairly frugally and have a good quality of life. I can't complain. I cannot imagine though, how I could survive on what i was earning 10 years ago, in today's climate. | |
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TLC_
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Joined: 1/26/2008
Msg: 12 | |
| Housing Affordability
Posted: 3/31/2008 7:09:34 AM | some points paul, but just think how good it will be in a few decades time, when oil has ran out and hydrogen fuel cells are the go, hydrogen in some form is available to all countries, not just a few.
countries can produce their own, the price we pay can be set bl local production costs, not by international conglomerates. ahhh the bliss, shares in oil worth less than toilet paper :) | |
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pedro!
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Joined: 9/22/2007
Msg: 13 | |
| Housing Affordability
Posted: 3/31/2008 7:50:26 AM | | I partially agree with you paul though I think that rampant unchecked free market capitalism is every bit as doomed as the Communist project for the exact reasons that you have stated, i.e. the unsustainability of a model whose voracious appetite and reliance upon a kind of exponential growth will see our poor little planet unable to fuel what Marx referred to as "capitalist combustion". The ideals of the Soviets were far from the race to the bottom that you described though in practice they failed miserably to deliver the utopia they espoused; corruption and privilege won out and cronysim of the worts sort prevailed. We on the other hand smugly pat ourselves on the back for our standard of living but tend to forget that it is very much supported by the sweat of a third world labour force that works for bugger all in slave labour conditions to manufacture almost everything we use. I wonder if there is a social / economic / industrial model in which a modern technological society might thrive while maintaining a balance of social and environmental responsibility? | |
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| Housing Affordability
Posted: 3/31/2008 8:22:46 AM | | i dont know how our doller relates to australias,but in edmonton canada an average house costs about 420 k and we have a housing problem.lol.to say the least.3 bedroom house rents for about 2 to 3 grand a month. | |
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| Housing Affordability
Posted: 3/31/2008 8:51:06 AM | I rent. I face the choice of either renting forever and having no investment out of it (dead money) or I buy a place... and have no lifestyle.
Neither is a pleasant decision. I would like to own a place, but I'm not that interested in paying 3-4 times what I pay in rent in order to own something. | |
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| Housing Affordability
Posted: 3/31/2008 1:47:35 PM | I was discussing this with a couple f other business owners and we came to the conclusion that one of the big problems is the mining boom.
This directly affects the people in the city.
There is a shortage of tradesmen as they head west to earn huge dollars working in the mines.
They are also cashed up and come home to buy a house, and having large amounts of money available to them, they wil pay the price, which forces up the average price.
In addition to this, the shortage of tradesman in the city makes it hard to find quality workers, and when you do find them, they require large salaries or wages to keep them there or they will head off as well.
So now, businesses are doing it tough due to wage hikes, house prices are going up so general population on an average wage can't afford a house and we are still selling raw materials to China instead of value adding to the product.....But then we've always done that so nothing has changed I guess. | |
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| Housing Affordability
Posted: 3/31/2008 4:10:26 PM | ah great topic!
i have a mortgage, not huge but enough to now have me decide to sell up. when the financials were sorted after my marriage ended i was lucky enough to be awarded $15,000 (oh yes good for me - about 1/4 of what i took to the marriage) and by some miracle found a house I could buy and a bank that would loan me the money. and things were ok - the little bit of centrelink helped (eg child payments) and that paid the house insurance, car insurance, school fees. now that has gone because both children are over the age of being eligible for payments, i am now digging into any money i had in the kitty. to the point now where there is zilch..... the kitty is empty!
after 8 years financially I cant keep going. as a relatively low income earner my pay is now consumed by mortgage and credit card payments and bills. the cost of living is now astronomical and once upon a time i could make extra payments now they have been eaten up by interest rate rises. I decided a few months back to lock in my interest rate, which at the time was a good decision. but now i have decided to sell up and will put my home up for sale in the next couple of weeks. If i had the added advantage of another income it would not be a problem, but on my own it is now a struggle and I am starting to lose sleep - something I don't like to do!
this house is also most likely going to need rewiring and replumbing and since I have been here has probably cost me $5,000 in attending to new central heating and patching up broken pipes etc. enough already!
All I can say is that I feel total and utter relief at my decision. I will clear any debts I have and invest the surplus. I am happy to pay the rent and actually have some money to myself instead of living off $50 a week, like it has been for the past few months. The only downside being is that both children think they will be moving back in with me when I move.......no, no, no that was not the idea! lol
but it is not only the mortgage as we all know - the cost of food and household bills is crazy and is not going to get any better! I am not fond of living on the poverty line and crumpets for dinner every night looses is gloss after a while.
i am happy to have a few thousand to invest at the end - and I may rebuy down the track. I am also about to start a better paying job and full time (currently work 4 days and also work for myself using abn - so 4 jobs all up) and I know that I will have no probs in saving and building on the money i have invested.
but I can tell you at times like these it sucks to be single - i hate making these decisions on my own and would love the opportunity to discuss it with someone in a similar situation, but all my friends are double incomes and quite comfortable - they dont understand the stress!
but anyway - to infinity and beyond!!! | |
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| Housing Affordability
Posted: 3/31/2008 4:23:44 PM | I live on both sides of the coin.
I have a house which i am paying off.
Which intrest rises have not helped.
But as a way to help i have rented out the top floor to borders .Which helps me pay the loan.
But yes the dream of owning a house is starting to be that for a lot of people.
Just a dream | |
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| Housing Affordability
Posted: 3/31/2008 5:31:22 PM | Gee - if I had a hat on I would take it off to you right now. Firstly for surviving your divorce with your kids and Secondly for purchasing a premises you had as your own that was not the Ritz but it was yours though struggling of course like many people do with repayments. If more people were able to take a step back from their want of a mansion to what they could truly afford, then things would be better.
Owning a house is what many Australians see as their `right` and with hundreds of lenders out there willing to give up 110% loans people take the bait without calculating exactly what their real budget is. I went to a wedding in January of a girl I work with - just Mr and Mrs Average with a lunch time wedding and 60 guests. She told me that a wedding 1/2 the size at lunch time and a honeymoon in Qld saved them $15k which went to their deposit. Both have 10 y/o cars and simple furniture and fortunately she works 1 hour more a day in overtime which she remarks that means they can eat tonight (but in reality her husband drives past to go home together). But to remain ahead they need to keep reality and their budget in good order.
Visiting friends at Easter, I noticed the FOR SALE sign on the lawn and asked if they were moving as I knew they rented whilst working in NSW. A neighbour told me it had been up for sale off and on for almost 2 years as the owner was greedy and could have sold when prices were 20% higher. My friends have been renting there for 8 months as they are working in NSW until December but pointed out to several homes which are up for a foreclosure auction by the banks to repay debt of the owners. | |
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| Housing Affordability
Posted: 3/31/2008 6:11:09 PM | I guess I am a recovered communist and a 'born again' capitalist..., though some of the 'commie' attitudes have remained.
I am very blessed...., being a land owner (several titles) and having no debt. I have built several homes over the years....,
mostly as an owner builder and I produce most of my own food requirements using my own labor and some other energy requirements.
I have never borrowed money, though understand I would possibly have more 'possesions' and security if I had done so.
I feel sad ...., that for the first time in this, 'the lucky country' there could be a large chunk of this next generation of our youth
that cannot even aspire to 'the Australian dream'...., i.e. owning their own home.
Think about that. How is that going to manifest itself within our society in the future. Not every kid has 'asset rich' parents !
I think there could be a negative social impact..., hell there is already.
We have some interesting times ahead ...., it's a good time to keep your cash ready for some cheaper homes.....,
trouble is these homes may be way out in "East B#mf#ck".
Maybe while we have something like uniformity of governance..., 'saint' Kev and the states can come up with some models for
....., housing co-ops, community housing and/or (more) subsidised housing.
Start lobbying the 'pollies' now people !
It would also help if...., some of the suits in Australia become more benevolent and altruistic ! 
I think of a line in a Jackson Brown song...., "Its so far the other way my countries gone!" ..., closer to the yank model. | |
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| Housing Affordability
Posted: 3/31/2008 7:29:05 PM | Gee... I'm with SergeantOz... hats off to you. It can be a big struggle all round. I have a small mortgage on a small place, mainly thanks to amicable settlement. I will never be a high income earner but manage ok. I also work for a tenant organisation and see first hand the huge struggle people have in keeping up with continually increasing rental costs. The property boom hit Brisbane in a big way, we are now considered one of the least affordable places to live! Rental properties changed hands for huge profits and the new lessors are now passing on these costs.... every 6 months a rent rise of at least $10 with a requirement to sign up or move out. Not many choices for renters. Not many choices for anyone who hasn't entered the property market already.
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| Housing Affordability
Posted: 3/31/2008 7:43:53 PM |
I feel sad ...., that for the first time in this, 'the lucky country' there could be a large chunk of this next generation of our youth
that cannot even aspire to 'the Australian dream'...., i.e. owning their own home.
This is unfortunately very true, I still however aspire to it, and I will realise it one day.
Gee, good for you. :-) | |
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| Housing Affordability
Posted: 3/31/2008 8:02:44 PM | I live in a common equity housing cooperative; well actually we are incorporated as a company as we didn't have enough members to form a cooperative, though we do attempt to work to cooperative principles. We hold title to a number of properties, which we rent back to ourselves at rents based on individuals' income rather than post code. Rents are used to for the upkeep and management of the properties.
One of the aims of oganizations like ours is to provide alternative housing models to the public housing and the Australian dream models.
To the OP... Thanks for bringing the topic up as it reminded me I hadn't responded to a question in another thread:
About one third of the population rents (even back in the 80's it was around 20% I think). Is it really viable to say that public money could outright house that percentage of the population, and could taxpayers realistically wear that additional burden? To me it makes sense to encourage investors to provide housing to ease the strain on taxpayers. What am I missing?
No I don’t think it viable to out right house that number of people with taxpayer dollars. But I don’t see why public money can’t be used to fund more self sustaining forms of housing like tenant managed cooperatives or housing associations. If funding and long term strategies were provided to seed these organizations and to help them develop and shake off the stigma of “housing commission” then perhaps more higher income earners could be encouraged into this form of housing to help make the organizations financially sustainable and allow them to expand and absorb a larger portion of the private rental sector.
Well I better go and make a cup of tea for that communist that's hiding under my bed | |
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Naamah
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Joined: 11/22/2007
Msg: 24 | |
| Housing Affordability
Posted: 3/31/2008 9:35:10 PM | Real estate has done well by me. Going in was always hard, and scary. Every purchase came with thoughts of "gawd that's so much money, how will we manage, should we have done this". We made sacrifices (no fancy wedding for example), and we contended with other people doubting the wisdom of our decisions, and seeing other people having more disposable income than we did. We bought in places that other people said "WHY?" about, that then later on got "discovered" by everyone else. Time has shown real estate to be a very, very good decision for me. That is perhaps somewhat inconsistent with the 'I want it now' thinking that prevails, but my experience has been that the scary equations don't look anywhere near as scary a few years down the track. Interest rates might rise, but hey, so does equity. (And so do rents, so that doesn't seem like a true escape from the rising cost of living to me.) Now, I'm so close to being mortgage free that I can taste it. Some might say I am financially lucky or priveleged to be in this position, but there was a whole lot of head-shaking and naysaying predictions and some tightening of belts to contend with along the way.
Anyway, money aside, the feeling of knowing I own my piece of space in this world gives me a horizon. Nobody can give me 7 days notice and inspect, nobody can ask me to move out, nobody can tell me I can't have pets, or to clean my oven (thank god cos I am thinking about just sealing it shut... just seems easier.). | |
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Naamah
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Joined: 11/22/2007
Msg: 25 | |
| Housing Affordability
Posted: 3/31/2008 9:47:02 PM | | Julianx, just read what you wrote. I stumbled across a Housing Co-op at one stage. It was government funded, meant to be used to help house those unable to meet the criteria of the private rental sector. Turned out the head of the co-op was using all the houses to accommodate his various family members. Nice little set up he had going using taxpayer purchased housing. If that's him under your bed wanting a cuppa, I wouldn't mind a word with him. | |
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