Perth home affordability.

[Guest Guest66881]

Perth property is more affordable than it has been at any time in the past decade, the Housing Industry Association says.

The HIA said rising wages and falling interest rates have helped offset increasing house prices, making properties as affordable now as they were 10 years ago when they cost about half as much.

The association's affordability index for Perth property is at 69.1 per cent - the best since December 2003 when it was 70 per cent.

It may be surprising given the median price for a WA dwelling is $575,000, more than twice the December 2003 median cost of about $271,000.

HIA chief economist Harley Dale said interest rate cuts helped offset the higher house costs, with a fall from 6.8 per cent on variable loans a decade ago to 5.35 per cent in the last quarter.

The rate changes have had a favourable impact on mortgage payments, which average $3128 a month compared with $1441 a decade ago. Mr Dale said homeowners were better able to service bigger mortgages because WA's average weekly wage was $1662, compared with $926 a decade ago.

 

http://au.news.yahoo.com/thewest/a/-/newshome/18697906/perth-home-affordability-best-in-years/

[Bibbs]

I'd say the housing is very affordable.

 

$750 a week, over 30 years gets you a 550,000 loan at 5.8% .. (just did the sums on the ANZ site, at 5.3% it's just over $700 a week).

 

550,000 when you add a 20% deposit will get you a place in all but the best suburbs.

[nicolac34]

$3,128 a month? Ouch!

[wolvesaussie]

there a lot of positive housing stories in press recently desperate to keep people buying. u cant rely on record low rates if unemployment really does rise there will be repossession and house price crash. they seem desperate to avoid that trying to trick us with positive stories

[newjez]

I don't think homes are affordable anywhere. Look at the price of houses and flats in Hove and Brighton. I don't know anyone who could afford to live there who is not living there now. (But move back from the beach a mile or two, and they before much more affordable - but still expensive.)

 

I doubt we will ever see the conditions of 95 again. If we did - it would cause an awful amount of pain to get there. Total economic melt down would get us there - would we want that? Do we want to be like Spain or worse?

 

We've made our bed - now our children will just have to try and find somewhere to sleep.

[newjez]

Danger is when the rates go higher in a year or two, and as prices rise - this equation becomes less favourable.

 

I'd say the housing is very affordable.

 

$750 a week, over 30 years gets you a 550,000 loan at 5.8% .. (just did the sums on the ANZ site, at 5.3% it's just over $700 a week).

 

550,000 when you add a 20% deposit will get you a place in all but the best suburbs.

[Bibbs]

Danger is when the rates go higher in a year or two, and as prices rise - this equation becomes less favourable.

By then you should have been able to over pay for a while and have a buffer.

 

It's also not much more expensive than renting.

 

Worse case, you get a lodger in to help.

[nicolac34]

I'd say the housing is very affordable.

 

$750 a week, over 30 years gets you a 550,000 loan at 5.8% .. (just did the sums on the ANZ site, at 5.3% it's just over $700 a week).

 

550,000 when you add a 20% deposit will get you a place in all but the best suburbs.

 

Do you think the average family/person has $110,000 saved up as a deposit plus $30,000 stamp duty?

[Bibbs]

Do you think the average family/person has $110,000 saved up as a deposit plus $30,000 stamp duty?

 

First time buyers pay no stamp duty under 500k, and only pay 100% over 600k (it's a sliding scale). So that can help.

 

Why wouldn't they have a deposit? It'll either be equity out of their old house, or it will be savings while living at home and/or paying less in rent, or for the younger ones assistance from the bank of Mum & Dad.

 

 

Using the figures above.

 

If your weekly wage is $1600, that's over $5k a month after tax, take $3k away for rent and living. That's $2k a month saving. So $25k a year. 6 years and you have your $110k deposit and $30k stamp duty.

[fifi69]

We are toying with the idea of buying at the mo. I know it makes more financial sense than renting but I think we would have to become hermits to be able to save deposit and stamp duty and i can't help but keep coming back to the fact that we can afford to rent a wow house in a nice area, to buy though would mean a bog standard box in a less desirable area somewhere out in the sticks

 

decisions decisions

[fifi69]

First time buyers pay no stamp duty under 500k, and only pay 100% over 600k (it's a sliding scale). So that can help.

 

Why wouldn't they have a deposit? It'll either be equity out of their old house, or it will be savings while living at home and/or paying less in rent, or for the younger ones assistance from the bank of Mum & Dad.

 

 

Using the figures above.

 

If your weekly wage is $1600, that's over $5k a month after tax, take $3k away for rent and living. That's $2k a month saving. So $25k a year. 6 years and you have your $110k deposit and $30k stamp duty.

 

 

6 years:mad: no way, life's for living. Think I will buy a boat instead!!

[nicolac34]

First time buyers pay no stamp duty under 500k, and only pay 100% over 600k (it's a sliding scale). So that can help.

 

Why wouldn't they have a deposit? It'll either be equity out of their old house, or it will be savings while living at home and/or paying less in rent, or for the younger ones assistance from the bank of Mum & Dad.

 

 

Using the figures above.

 

If your weekly wage is $1600, that's over $5k a month after tax, take $3k away for rent and living. That's $2k a month saving. So $25k a year. 6 years and you have your $110k deposit and $30k stamp duty.

 

It's just a very simplistic way of looking at it I guess. Having the commitment to save $3k per month, every month for 6 years I think is a bit of a stretch.

 

I'm not disagreeing with the affordability of housing necessarily, just that a first time buyer probably isn't going to be forking out $760k for a house.

[Bibbs]

We are toying with the idea of buying at the mo. I know it makes more financial sense than renting but I think we would have to become hermits to be able to save deposit and stamp duty and i can't help but keep coming back to the fact that we can afford to rent a wow house in a nice area, to buy though would mean a bog standard box in a less desirable area somewhere out in the sticks

 

decisions decisions

 

Yup, it is that choice.

 

We rented an awesome 2 bed apartment at Burswood. We now have a 4 bed place in the 'burbs.

 

Looking at your postcode, I know your area well. As you say, cheaper to rent than own around there.

[wolvesaussie]

financially going to uk was very bad for me. most of my friends stayed living at home for 4 or 5 years after education giving time to raise the 100? 000 deposit. Now im back but im your 30s after u lived on ur own for years not so appealing

[jen85]

First time buyers pay no stamp duty under 500k, and only pay 100% over 600k (it's a sliding scale). So that can help.

 

Why wouldn't they have a deposit? It'll either be equity out of their old house, or it will be savings while living at home and/or paying less in rent, or for the younger ones assistance from the bank of Mum & Dad.

 

 

Using the figures above.

 

If your weekly wage is $1600, that's over $5k a month after tax, take $3k away for rent and living. That's $2k a month saving. So $25k a year. 6 years and you have your $110k deposit and $30k stamp duty.

 

If your a single income young person wanting to buy a house and NOT earning $100k plus per year and lets face it not many 20+ somethings would be then it is tough! Not everyone has mum and dad to help them out and saving a deposit that large on a small wage could take 10+ years!

[Bibbs]

It's just a very simplistic way of looking at it I guess. Having the commitment to save $3k per month, every month for 6 years I think is a bit of a stretch.

 

If you want the $700k house off the bat, then yes. But most people move up the ladder over time.

 

Also as a couple you could halve that time by both having *average* paying jobs.

Or some people used to do FIFO (when mining was booming) for a year or two and bank the money.

 

When I lived in Essex I know a guy who dealt coke for 2 years for a house deposit and gave it up. Not what I'd call a good way to get a deposit, but it worked for him.

[Bibbs]

If your a single income young person wanting to buy a house and NOT earning $100k plus per year and lets face it not many 20+ somethings would be then it is tough! Not everyone has mum and dad to help them out and saving a deposit that large on a small wage could take 10+ years!

 

So if you are single, and you earn a below average wage, and don't have assistance.

Don't try and buy an average (or above) house. Live within your means. Buy somewhere that is cheaper.

 

We can't magically give everyone a mansion in Peppermint Grove just because they do 40 hours a week.

[nicolac34]

I wish I had the determination to save. I think I'm just one of life's spenders and pay-it-backers :biggrin:

[Bibbs]

I wish I had the determination to save. I think I'm just one of life's spenders and pay-it-backers :biggrin:

 

Plenty of us like that now credit is cheap. But you only have to go back a generation or two and you find that most people saved before buying.

 

But then again they were not distracted by iPads & handbags.

[VERYSTORMY]

Someone is living in the land of the fairies. Perth is way overpriced for housing. It is worse than London and Perth is most certainly not London. One is a small city based on heavy industry and one is regarded as one of the most important cities in the world. Perth is probably closer to Sheffield than London.

[Guest JK2510]

You try to find a house for under $500k. We have just had a bill from our settlement agents brought for just over $550k...over $12.5k stamp duty. We were lucky enough to stay with family and save large amounts over a short space of time.

[Bibbs]

You try to find a house for under $500k.

 

Well I just went on Realestate.com.au and looked at Perth and under $500k. There are thousands of them.

[Guest]

http://www.globalpropertyguide.com/Pacific/Australia/Price-History

 

I think i'll skip buying in Darwin. Perth looks overvalued too

[Guest]

Someone is living in the land of the fairies. Perth is way overpriced for housing. It is worse than London and Perth is most certainly not London. One is a small city based on heavy industry and one is regarded as one of the most important cities in the world. Perth is probably closer to Sheffield than London.

 

Does that mean Perth has Henderson's relish!? Awesome!

[Guest Guest26012]

Does that mean Perth has Henderson's relish!? Awesome!

 

yeah! I've got tons of the stuff lol!