Family and friends all around me have been panicking over the recent years about the lack of housing affordability.
Got a spare $900k anyone? Fancy a mortgage loan of $720k? Got a lazy $180,000 in your back pocket to use as a deposit(down payment)?
House prices were ratcheting up at such a fast rate that we could see housing affordability dwindle before our very eyes. Sure, several of us have bought apartments but less than ten of us have bought a house. We had to start somewhere.
What Do I Mean By 'House' ?
A proper house. At least three bedrooms, bathroom and a carpark on a block that is at least 500sqm and larger. A freestanding house. Not a town house and not an apartment. Not any property that has strata levies to pay.
The property market has settled somewhat due to the increase in the cost of living such as fuel, electricity and mortgage interest rates. It would be a shock if we browsed the real estate websites next year and house prices have yet increased again by $200k or $300k. If it increased $200k in one year, which it has in recent years, that means we would have to save $60k in one single year just to maintain the aim for a 20% deposit.
My latest discussion with family and friends over the topic of buying a home closer to the CBD leads me to conclude that we are all frantically saving in order to buy a house before prices escalate further.
Housing Price Crash Predictions for Sydney
International 'experts' believe that our housing market is overvalued but I challenge them to try and find a rental property. The rental property is tight due to the insufficient number of new housing(apartment+houses) being built and as long as rental yields are decent, investors will keep buying properties and this will support housing prices. It's easy to be an armchair expert sitting at your desk on the other side of the world making predictions about the Australian property market and it's another matter to be pounding the pavement around Sydney, submitting rental applications and being rejected.
Everyone is entitled to their opinions, armchair experts inclusive.
Will our property market collapse like the U.S or the U.K? I think not after looking at these factors. To buy a block of subdivided land cost around $300k. To build a new home on that block is a further $300k. If the price of a house and land package is around $600k then it would be absurd for the D&G(Doomers and Gloomers not Dolce and Gabbana) crowd to think that housing will crash 40% and not find support before that. There would have be high unemployment before investors and owners will start liquidating their properties and the labour/job market in oz right now is tight.
Cheapest House Listed for Sale
In my image above, I've circled suburbs about 30 minutes travel to the CBD. Properties with greater proximity to the CBD will usually be more expensive. I'll be doing a search on www.realestate.com.au and ordering the search results by price, low to high and will post up the CHEAPEST house that is in the search results.
Note that the cheapest house in each suburb are usually on main roads, nowhere near public transport facilities or public transport routes for trains and buses, usually nowhere near amenities such as shops, cafes, schools, on smaller than average size blocks as well, unrenovated, are cottages or fibro, pitiful landscaping and have something glaringly unattractive about them which is why they are the cheapest one in the suburb:
$910,000 at Freshwater
69 Lawrence Street, Freshwater NSW 2096: 3 bedroom, 1 bathroom, 1 car, 423sqm block
$898,000 at Roseville
38 Malvern Avenue, Roseville, NSW 2069: 4 bedrooms, 2 bathrooms, 2 car, 862sqm block
$720,000 at Epping
55 Carlingford Road, Epping, NSW 2121: 3 bedroom, 2 bathroom, 2 carpark
$569,000 at Parramatta
2 Symonds Avenue, Parramatta, NSW 2150: 3 bedrooms, 1 bathroom, 1 car
$600,000 at Kingsgrove
221 Stoney Creek Road, Kingsgrove, NSW 2208: 3 bedrooms, 1 bathroom, 2 cars, 510sqm land
$870,000 at Matraville
81 Jennings Street, Matraville, NSW 2036: 4 bedrooms, 2 bathrooms, 2 car, 632sqm
How was that for a taste of the CHEAPEST house in the suburbs that are at least 30 minutes drive and longer to the city? Dingy, old and unrenovated houses that are poorly positioned and yet still be paying over half a million for them? At least house prices are having a bit of a breather right now and we all need that period of price stability to even have the opportunity to aim for a decent house.