Each Saturday morning I like to share some of the interesting property investment and economic articles I’ve read during the week.
I’ve put them here all in the one place for your easy reading.
Enjoy your weekend….and please forward to your friends by clicking a social link buttons on the left.
Are the rich getting richer? Not in the housing market.
We know there is not one property market. Each state is at its own stage of the property cycle and in each state different geographic locations and price points segment the markets.
Then there’s the house market and the unit market.
According to RPData we are seeing significant differences across price segments in the market with the most expensive housing markets generally underperforming compared with the more affordable markets.
Across the combined capital cities, the most expensive twenty percent of suburbs have seen values fall by -8.5 percent since the market peak compared with a -4.0 percent fall across the most affordable twenty percent of suburbs and a -4.4 percent fall across the broad middle 60 percent of suburbs.
As can be seen from the graph above, the most expensive markets have outperformed the broader capital city average during the growth phases but underperformed during the corrections.
Over the past five years the annual rate of growth across the most expensive segment of the market has been just 1.7 percent per annum compared with a growth rate of 2.9 percent per annum across the most affordably priced suburbs and 3.3 percent per annum across the broad middle priced suburbs.
The trends across the price segments aren’t uniform across all of the capital cities.
Brisbane and Adelaide are showing the opposite performance, with the more expensive price segments of the market returning a better result for dwelling values compared with the more affordable priced suburbs.
This is interesting in the sense that Adelaide and Brisbane are also the most affordable mainland capital cities to be buying in (Adelaide’s median dwelling price is $371,500 and Brisbane’s is $405,000).
The weaker performance in these markets can be linked with mortgage repayment pressures being felt across the mortgage belts of both these cities, particularly in South East Queensland where many of the most affordable suburbs in the region have shown a higher than average level of mortgage arrears.
The performance across price segments highlights why it is so important to drill down below the capital city boundaries in order to truly understand housing market conditions.
How many properties do you need to retire well?
Another great Property Uncut show produced by Kevin Turner. If you don’t already subscribe to this excellent weekly Internet based radio show.
This week he has a heap of great guests:
- John Fitzgerald from Custodian Wealth Builders
- Michael Yardney from Metropole Property Strategists
- Rob Balanda from MBA Lawyers
- Dr Phil’s Money expert Loral Langemeier
- Michael Teys from Teys Lawyers
You should definitely subscribe to the weekly Property Uncut audio program. Click Here It’s free and you can listen on the go on your smartphone, iPad etc.
There is no Australian housing affordability crisis: Terry Ryder
In a recent article in Property Observer Terry Ryder says…
I keep reading about our “affordability crisis” and wonder whether I’ve teleported into a parallel universe.
The one I live in doesn’t have a crisis in affordability. The latest data suggests that affordability is at its most attractive level in 10 years. A combination of lower prices, cheaper loans and higher incomes has put homes without reach of more people.
Various sources, including the RBA, keep telling us the relativity between prices and household incomes has changed very little in the past 10 years – some say in the last 20 years.
Rather than an affordability crisis, we have an analysis crisis. The information channels are cluttered up with individuals and organisations running political campaigns or pushing vested interests, aware that the claim of a “crisis” will always gain an easy passage through to publication.
Ryder suggest that…The people who see a “crisis” need to get back to the drawing board. But, please, do some research first, rather than wasting everyone’s time by bringing emotionally charged furphies to the national debate.
The boom in baby boomers
With almost 40 per cent of the population of greater Sydney now aged over 45, Baby Boomers are going to be a major force shaping our property markets over the next decade – just like they have been in previous decades.
Therefore it’s little wonder that many new-apartment developers are deciding to target cashed-up empty-nesters as one of their priority markets.
As baby boomers race towards retirement age, more and more apartments are coming on to the market specifically designed to appeal to this demographic.
Amazing property trivia from around the world
HouseLogic ran an article sharing some fun property related trivia. Did you know…
1. Google rents goats to do its mowing.
Rather than use gasoline-guzzling, noisy mowers at its Mountain View, Calif., headquarters — the Googleplex — Google has been known to keep its lawn coiffed with rent-a-goats.
Google rents goats from a cool company called California Grazing, which swears it can maneuver a herd of goats through crowded city streets. It’s an eco-friendly approach to landscaping — and you can’t beat the cute factor.
2. Swedes and Danes use dead bodies to heat their homes.
It’s an idea that makes a lot of sense when you think it through. Crematoriums heat up to 2,000 degrees, which is a lot of energy that was going to waste — until someone got the bright idea to pump that heat into local energy companies, where it’s used to warm homes.
3. Brass doorknobs disinfect themselves.
It’s called the oligodynamic effect: The ions in the metal have a toxic effect on spores, fungi, viruses, and other germs — eliminating the nasties within eight hours.
4. The original housewarming party was — literally — a housewarming.
Guests brought firewood as gifts and lit fires in all the fireplaces in the home. Obviously this warmed up the place for the family, but it was also believed to ward off evil spirits. Uninhabited homes were thought to attract roaming ghosts, so a new home would have to be rid of that bad energy before it could become a happy abode.
5. In Scotland, home owners paint their front door red when they pay off their mortgage.
Throughout history, a red front door has symbolized many things — the ancient Hebrews believed it would protect firstborn children from the angel of death; in the early days of America, it meant the home was a safe place for travellers to stop for the night. And according to Feng Shui, a red front door invites positive energy into a home.
6. There’s a chain of bathroom-themed restaurants.
At Modern Toilet, a restaurant chain based in Taiwan, patrons sit on toilets, sip soup from sinks, and wipe their mouths with toilet paper. While the latrines aren’t functional (except in the actual bathroom, we hope), you’ll certainly have something to talk about until the food comes.
12. According to an old superstition, if a bird flies into a home, death is soon to follow.
Long before “put a bird on it” became hipster décor, birds were thought to symbolize imminent death for the home’s occupants. People have long connected birds to the spirit world, and it’s evident in our culture — just think of Edgar Allen Poe’s poem “The Raven” and Alfred Hitchcock’s movie “The Birds.”
Read more property trivia in the full article at: HouseLogic.com
Quantity vs. quality
Are you fascinated by China’s blistering growth?
Always remember what your grandmother told you about quality over quantity.
One of the longest bridges in northern China collapsed recently, just nine months after it opened, setting off a storm of criticism from Chinese Internet users and underscoring questions about the quality of construction in the country’s rapid expansion of its infrastructure.
The New York Times reports that the bridge had cost almost $300 million.
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