Last week I asked the question are Sydney house prices depressing in this blog.
So how do you want to live? House or shoe box?
Some people have said “Embrace apartment living. The time of affordable detached houses is over. I would definitely live in a shoe box with my wifey and some cats,” but others say “I want a garden and a chook run
Not sure I’d be able to find a strata scheme that’d let me have chooks.
There is no doubt that people want to live in the city for the added perks and high paid workers are prepared to pay for it even it means living in a shoe box apartment.
Some people even joke “Check out this nice $300,000 Winnebago! Boom you have cheap city living! Sure you might have to find power and water but I’m sure you can work something out.”
So where can you still afford to buy a house in Sydney on an average income?
Well according to Census data, the average median weekly household income is $1,447 and the corresponding mortgage value they can afford is around $430,000 to $500,000. Well you have no choice but to go west if you want to stay in Sydney.
Ok, so you have decided you don’t want to live in one of those massive apartment buildings with a gazillion people or you have decided to still live in one (maybe renting) and buy a house out of the city to save you getting in silly amounts of debt.[sam id=34 codes=’true’]
Some city people have a bad view of buying in western Sydney, as one commenter said “Oh but wait, there’s a $35,000 government grant, so you can buy yourself a new home at some new estate called “The Ponds” where you would be lucky enough to get any mobile phone coverage and forget any internet coverage.”
Some people even say “It takes an hour to get to the city if you buy a house past Parramatta”. Obviously, they’ve never driven out west before.
Setting the record straight about buying in western Sydney
You can buy a house and land for under $500,000 in;
And make it to Town Hall train station in 45mins on a Saturday worst case scenario. We have full National Broadband Network (NBN) with speeds of up to 100Mbps. I have also heard people say “But all the work is in the city.” Well that is not entirely true.
There are 9 industrial parks surrounding these suburbs and more than 25% of Australia’s top 500 companies have a presence in the area, and the area also enjoys growing links with China and India.
There is major infrastructure boom in the area which means more jobs and growth. Some people tell me there is a crime issue out west. Well I don’t think they have looked in to it that well and just taken the media’s word for it.
Crime actually has dropped over the past couple of years in these areas (under 738 cases) but I can’t say much for the south west, with 770 cases and increasing. Just look at the map below which shows the crime rates for the Inner West and Eastern suburbs.
Not enough people have a vision for the future.
We have buyers that come to us in Toongabbie saying “We have $400,000 to spend and we want a house and land. Oh, and we don’t want Lalor Park”. Most of them can’t find a property and aren’t willing to go up $20,000 to secure the particular home they want, so they hold off for 6/7 months to save for a bigger deposit.
Now property prices have gone up $50,000 in Toongabbie and they are still well priced out of the area. People are now asking us to see homes in Lalor Park but in the last 6/7 months Lalor Park property prices have now increased to levels close to that of Toongabbie real estate when the price increase started and now they can only afford a base model home there.
The sad thing is that they could have gotten an above average home there 6/7 months ago! I would suggest 40% of average home buyers are in this loop and it’s a vision problem, not looking to the future when purchasing a home. I know it’s a big decision. I’m not belittling them. In fact, I was in this loop myself.
I would suggest in a market like this, pay the extra 1,2, or 10 grand to secure the home now because you’re not going to remember the exact figure you paid for it in 7 years’ time anyway, or just choose another suburb!
House prices will always go up and down. I’m not delusional. However, if you want a home in this market, you should know what you are willing to pay for a home and fight to get it, or you could wait for the property cycle to come down (not sure how long that will be) but Sydney’s sub-markets can have a mind of their own and defy market averages.
Sydney housing being expensive is subjective based on your mindset. People don’t have a vision for the future and how property cycles work and even how to eventually afford where they want to live.
They aren’t willing to sacrifice to get ahead in life because everyone wants everything and they want it now. For the average person to be able to buy in Sydney they need to separate their wants from their needs and understand that Sydney is only “unaffordable” if you have the wrong mindset.