Australia housing bubble

[Citroënbender]

Second hand appliances. Plenty of bargains, plenty of perfectly good reasons stuff is for sale. Get over the pride, clean it mercilessly and it’s your win for the budget - no longer someone else’s cast-off.

FWIW my parents had no TV until 1981 1982, no phone until 1976. They generally had a second hand car <5 years old on the basis of no mechanical skills therefore less cost risk from age related failures. We had second-hand school clothes.

Originally Posted by PG2

…I have always thought leftovers taste better the next day.

Absolutely! And you always look forward to it so much!

[FTE217]

Drop the idea getting a loan for new car, dead loss for the privilidge.
Wait till you can actually afford the hit.
That must do a OS trip.
Drop Uber eats.
Do you really have to have those "branded" clothes and 250up Nikes or McQueens.
Women or your partners spenditure on salons,make up,lashs,injections.
Gyms are OTT cost today, do it at home, YT is your friend.
App expenditure.

CB mentioning retro or Op Shops.
To this day my wife loves visiting Vinnies/Smith family shops.
Passing on our great condition cast offs for someone's good use she buys bargains every time be it brick or brak and clothing new countless times.
Another money spinner she use's FB market place to de clutter, the quick 1 $200 always pays for a take away night for eg or a Dan M visit.

[PG2]

For the millennials...

FTE217 and Citreonbender have suggested buying second hand. This does not mean go shopping at a hipster 2nd hand shop and buying something 'retro'.

[Citroënbender]

Some yard things are not so good second-hand unless you’re well-skilled and tooled up. Fencing (metal, including aluminium) is one example, decking materials another. You’re generally saddled with unsuitable dimensions or age related deterioration. I notice people often ask too-high prices for used modular retaining wall components.

[Yellow_Festiva]

Originally Posted by blueoval

While the temptation is there to sell, unless you are downgrading, what could you buy to replace it comparitively?

https://pulsehobart.com.au/news/enti...t-up-for-sale/

[Yellow_Festiva]

Originally Posted by Citroënbender

So… Why aren’t people taking lodgers or tenants to support their mortgage? You’d think it was a win-win.

I did this for a while. Great money earner but fraught with danger from the legalities. Insurance is a pain, then you need to claim the income and the accounting side of things gets hard if you have a mortgage.

Plus, the more you deal with people on a more direct personal level and try to mix with that a business relationship the more you hate dealing with people and regret taking on the tenants.

[hayseed]

Originally Posted by PG2

Shop for specials, cheapest prices for groceries
If something is on 'special' then buy two, three or four of it - just be careful not to buy too much that it will go out of date.

This is how 85% of the Red Meat In our House is Bought.. Particularly when It's approaching Its Best Before (or Display until) Date It's mostly 30-50% Off.!!

We just take it Home & freeze It,

Take your lunch to work
I know, it doesn't sound sexy but I have always thought leftovers taste better the next day.

Absolutely, The Flavour gets a Chance to Infuse itself throughout the Meal..

[Yellow_Festiva]

Originally Posted by Itsme

I was in the same boat with the bank in regard to savings, they changed the goal posts every time I applied. In the end I sold my pride and joy to secure the loan.

In 2002 or 2003 I applied for a loan to buy a unit in Sydney.

Was $72k (total) if I recall. I had the cash to buy it outright yet I failed the loan application as I was working casually (full time or more hours).

So I bought it outright to not lose the sale then refinanced it several months later for a valuation of $93k.

Last year (or late 2021??) I applied for a $6k travel credit card (the lowest you could apply for). I applied for it after not working almost 4 months due to a period of holiday time off then 3 months of lock down.

I failed the application due to not having an income, but with having a 7 digit bank balance earning interest. "The computer says no"...

Interest (nor the actual money) wasn't factored in as income or assets because it was not secured or guaranteed "I could pull it out and spend it tomorrow".

I don't have many kind words to say about the banking industry as a whole.

[Yellow_Festiva]

Went to 4 auctions last weekend.

The market is very strong between the $900k-$1.2m bracket. Lots of bidders and vendors still getting decent money.

I think once you go over $1.3m things get much harder. (SW Sydney).

Many of my saved properties are also selling prior to auction. Another agent I'm dealing with did the right thing and messaged me with a pre-auction sale offer that I had the option to beat.

The other sale I missed out on last week was almost certainly an inside job as the price they got was well below value and less than I would have paid had it went to auction or had I been offered the chance to counter offer.

I have removed all saved properties from that agent and will refuse to deal with them.

What I have also noticed is that my notifications for properties that match my criteria has all but dried up. Where I would get 10 matches a week late last year it has fallen to 2 or 3 matches a week.

Got another open this afternoon and will be a little bit more forceful in seeing if they will entertain offers prior to auction. It 90% matches what I need but if the price is right I will have some play money left over to fix up what's lacking.

And it's from the same agent that gave me the courtesy of a text message for the other place I inspected so lets see what happens.

[Yellow_Festiva]

Originally Posted by hayseed

This is how 85% of the Red Meat In our House is Bought.. Particularly when It's approaching Its Best Before (or Display until) Date It's mostly 30-50% Off.!!

We just take it Home & freeze It,

Absolutely, The Flavour gets a Chance to Infuse itself throughout the Meal..

I won't buy anything unless it's on special or reduced. I wish I had a bigger freezer!

I'm a member of a tight a$$ FB group - some of their discount finds really put me to shame lol. Needs to be right place at right time.

[Polyal]

https://www.livewiremarkets.com/wire...ecord-in-sight

[fordomatic]

Originally Posted by PG2

Does anyone else have any hints on how to save money?

Live within your means, simple really.

I'm in my late 30's.

I support my wife and two kids on my single income, which for Canberra is considered below average.

We have a mortgage for investment properties and rent where we live for about half the market rate of rent.

We shop at Aldi, fresh food markets, get petrol from Costco. We are smart with our money. Coffee machine at home, instead of getting it when out.

When COVID hit we lost $1800 a month because on of our investments is a hotel. We managed to survive without dipping into savings, thanks to low interest rates. Our mortgage has gone up by $850 a month. We aren't stressed about it because we survived on 2k less a month through COVID.

Flip that to all our friends who are constantly crying poor. We are the only single income family out of all our friends. They all have new cars, go out for meals all the time, have all the fancy stuff in their houses. It drives me crazy when they whinge about being poor, in reality they are not, neither am I.

My kids are lucky, they don't miss out on anything from the sacrifices we've made. We don't go to the shops on the weekends. We are out hiking, fishing, surfing, spending time as a family and giving them experiences they will remember rather than things that will get thrown in the bin.

Everyone is different, but some need a reality check. I remember not eating red meat as a kid for 12 months because the farm was so far in debt. I remember eating rice and pasta for most meals and only having jam sandwiches for lunch when times were tough etc etc. We didn't even have a TV until I turned 13 (remember i'm still young now). None of this changed the way I grew up other than making me realise that you can't have what you want without hard work.

[BENT_8]

Good ideas on how to cut spending but I fear the bigger issue is convincing people to consider it in the first place.
Theres a whole generation of young adults out there who've never experienced the need to tighten spending, they also make up a good percentage of those who only buy the latest of everything to compete with their friends. As if any of them will be the first to be 'that' person in the group and buy 2nd hand or not at all.

I think its more likely people will opt for 2nd jobs to support their current spending habits than consider spending less, unfortunately the collateral will be the children who are already suffering the effects of attention deficits.

[FTE217]

Originally Posted by Yellow_Festiva

In 2002 or 2003 I applied for a loan to buy a unit in Sydney.

Was $72k (total) if I recall. I had the cash to buy it outright yet I failed the loan application as I was working casually (full time or more hours).

So I bought it outright to not lose the sale then refinanced it several months later for a valuation of $93k.

Last year (or late 2021??) I applied for a $6k travel credit card (the lowest you could apply for). I applied for it after not working almost 4 months due to a period of holiday time off then 3 months of lock down.

I failed the application due to not having an income, but with having a 7 digit bank balance earning interest. "The computer says no"...

Interest (nor the actual money) wasn't factored in as income or assets because it was not secured or guaranteed "I could pull it out and spend it tomorrow".

I don't have many kind words to say about the banking industry as a whole.

In the big picture who has any nice words about that industry but for the large Corporates who are in the position to leverage compared to us sheeple.

As for "systems" this is life no matter how cashed you are or not as you know.
Why wouldn't you have drawn $6k out into a debit card unless there's other techicalities I don't know.

Agreed re the $900 - say 1.3 segment, thats the volume good entry price staying solid, the open days we've attended is damn busy with interest, I just wonder how many are actually ready and serious to buy.
Alot of compramise at that price level might I add but thats the segment in Sydney.
Having just been in the GC week before last, looking in areas such as Currumbin/Elanora/Palm Beach, just west off the Hwy being the beach a block off east side you can get into 2/3bed house's easy that kind of budget and under 900k.
Waterways are close by, you'd be a 10min drive to the beach.
Apartments your in easy 900k and obviously if you want beachside you pay 1M up but its nice not in burbs like Sydney.

[Yellow_Festiva]

Originally Posted by FTE217

In the big picture who has any nice words about that industry but for the large Corporates who are in the position to leverage compared to us sheeple.

As for "systems" this is life no matter how cashed you are or not as you know.
Why wouldn't you have drawn $6k out into a debit card unless there's other techicalities I don't know.

Applied for a travel credit card as I was planning multiple OS trips and I had the same card in the past and it was truly a 'no international fee' credit card (28 Degree card).

So was trying to save a bit on the fees when travelling.

Have gone OS 5x since borders opened so as you can imagine I would have racked up quite an amount of fees.

Oh well, I guess there are worse things I could whine about.

[zilo]

Originally Posted by Yellow_Festiva

https://pulsehobart.com.au/news/enti...t-up-for-sale/

Already rang and asked, they are expecting between 6-8 million.

I know of a better one

[zilo]

Originally Posted by GO FURTHER

Going by the chart I posted earlier, I would say that Millennials will have it the hardest.
Simply because their debt-to-income ratio is more than double that of the Boomers.

Let's face it, many Boomers were able to easily pay out their relatively small mortgages (especially once interest rates dropped from the initial high 17% they were paying for a few years to the much lower 5 - 8%), over the term of their loans, well before the 25 - 30 year term finished.

This allowed many of them to invest in other areas, such as an investment property, shares or buy luxury items, once their mortgages were paid out, and build their wealth.

In contrast, it is unlikely that many Millennials will be able to pay out their mortgages early, so will be faced with the ongoing struggle of monthly mortgage stress for a much longer term than the Boomers.

There's just a few itty bitty little details that can easily be overlooked in your poor estimation of boomers.

For a start we didn't have paid parental leave,,,gymnasiums in the workplace...childcare subsidised or...on site in the workplace...etc etc etc

And after all that I clearly remember working on a Sunday, double time...and bringing home less than a single time hourly rate.

WHY? Because we endured a 60% income tax rate above $35k a yearr.

Add in 17% interest rates and that makes those comparisons a little more equitable now doesn't it...

[blueoval]

Originally Posted by Yellow_Festiva

https://pulsehobart.com.au/news/enti...t-up-for-sale/

I like it, cant afford it.

[T3rminator]

Originally Posted by zilo

There's just a few itty bitty little details that can easily be overlooked in your poor estimation of boomers.

For a start we didn't have paid parental leave,,,gymnasiums in the workplace...childcare subsidised or...on site in the workplace...etc etc etc

Not sure about the others, but on child care, the median child care cost in the late 90s were $22 per WEEK. Day care centres were $41 per WEEK.

https://www.abs.gov.au/ausstats/abs@...3!OpenDocument

What is it today? $70-185 per DAY?

[FTE217]

ah the ol gov stats like wiki is the oricle......
Its a general overview and typically Gov right.
Most of us/parents like to have your son/daughter in a clean well run one and also depends on your location and facilities available with spaces etc..
The figures in the Gov doc who knows where they based it from but a general rule of thumb.
We were paying $70 a/w daycare, my wife looked high and low and close enough proximity from our place regards transport, no traffic you might get there in 20min with luck, traffic 30+, worse late arvos picking up 5.30/6pm..

I wouldn't be feeling smug and loling that you got him for for us, we were busting our guts and I used to say to the wife is this worth it how much it eroded into her wage but we had no choice.

[T3rminator]

I can all I like because some of the stuff being sprouted is laughable.

ABS is Australian Bureau of Statistics. Its actual data from government agencies.

In statistics and probability theory, the median is the value separating the higher half from the lower half of a data sample, a population, or a probability distribution. For a data set, it may be thought of as "the middle" value. The basic feature of the median in describing data compared to the mean (often simply described as the "average") is that it is not skewed by a small proportion of extremely large or small values, and therefore provides a better representation of the center. Median income, for example, may be a better way to describe center of the income distribution because increases in the largest incomes alone have no effect on median. For this reason, the median is of central importance in robust statistics.

That one is from wiki

Smug is when boomers or the likes, who reaped the rewards of the biggest boom time, telling kids they can own their own home only if they were willing to give up their lattes and smashed avos. And you wonder why kids these days are feeling disillusioned.

[FTE217]

all power to you, not sure you come across well but thats your type making point of cheap milk and avo's I didn't.
Water off a ducks back you da kid.

[GO FURTHER]

Originally Posted by zilo

There's just a few itty bitty little details that can easily be overlooked in your poor estimation of boomers.

For a start we didn't have paid parental leave,,,gymnasiums in the workplace...childcare subsidised or...on site in the workplace...etc etc etc

And after all that I clearly remember working on a Sunday, double time...and bringing home less than a single time hourly rate.

WHY? Because we endured a 60% income tax rate above $35k a yearr.

Add in 17% interest rates and that makes those comparisons a little more equitable now doesn't it...

Well, like some of the posters in this thread, I am a Boomer.

All my kids are Millennials in their 40's, late 30's and late 20's.
They are all in their first homes.

So, going not only by my firsthand experience as a Boomer, but also seeing how my millennial kids are doing, I can definitely say we boomers in general had it a lot easier back in our day.

I bought my first home in a well to do, upper middle class suburb, just 20kms from the Melbourne CBD.
Cost me $39,000, and I put down a $9,000 deposit, which only took me less than a year to save for on an average wage.
Interest rates started for me in 1984 at just under 11% and rose to 17% by 1990.

By contrast, My kids all have $500K plus mortgages at circa 5% at today's rates.

If I asked my Millennial kids the following question, I know what their answer would immediately be...

"Would you rather have a mortgage of $30,000 at 17% or a $500,000 one at 5%?"

Life is a 30 year mortgage... It's not so much the interest rate that's important.
It's really the amount you need to borrow today and the huge monthly repayments you need to find for every month of those 30 years.
(Not to mention the much harder to attain 20% deposit needed today).

Even allowing for higher income tax rates and lower average incomes back in the 80 -90's, than today, Boomers were still better off IMO.

You said. "WHY? Because we endured a 60% income tax rate above $35k a year"

That was true... But the difference was, you did not have to earn more than 35K back in those days, to comfortably get into your first home and meet the repayments.
Taking into account that the average adult Australian wage was only $27,000 back in 1990.

Boomers also had the added benefit of seeing some of the best boom years in Aussie Real Estate, building their equity and wealth a lot quicker.

The first home I bought in 1984 for $39K, I sold 18 months later for $68K... A massive 74% increase in less than 2 years.

Took the $68K and bought a bigger home for that amount (but a little further out were land was cheaper)... Sold that 4 years later for $133K... A 95% capital gain.

And both of those were including doing no renovations or major improvements other than a lick of paint.

So in reality, although interest peaked at around a high 17% during that time... I never really paid any interest in real terms after taking the huge boom years of capital gains into the equation.

Many Boomers did equally well in Real Estate that set them up for life, if they are totally honest.

There is no question in my mind that the Boomers had it the best, in all the 7 generations from The Greatest Generation to the present Gen Alpha's.

[b0son]

Originally Posted by zilo

Because we endured a [B]60% income tax rate above $35k a year

Not since 87. Next you'll be telling us how hard the war was.

[Itsme]

Originally Posted by T3rminator

Not sure about the others, but on child care, the median child care cost in the late 90s were $22 per WEEK. Day care centres were $41 per WEEK.

https://www.abs.gov.au/ausstats/abs@...3!OpenDocument

What is it today? $70-185 per DAY?

In 83 my wife went back to work for extra money, by the time we put our two kids in day care she only worked briefly, with other added costs she was basically working for nothing.
In those days both of us were low wage earners, I won't bother with figures but trust me not all boomers were getting an easy ride as some think.

[T3rminator]

So Kerri from Coogee has caused quite a stir. Interesting comments from boomers and the likes. Good to see some can park their ego and acknowledge the challenges of today's generation.

https://twitter.com/abcnews/status/1...689612800?s=20

Originally Posted by Itsme

In 83 my wife went back to work for extra money, by the time we put our two kids in day care she only worked briefly, with other added costs she was basically working for nothing.
In those days both of us were low wage earners, I won't bother with figures but trust me not all boomers were getting an easy ride as some think.

No one disputed that it was hard. Every home owner has had to make a sacrifice in some shape or form, and I guess that goes the same with having kids.

I know how hard it was. Dad worked over time satdays and sundays for 10+ years just so he could pay off the mortgage, get us to school, give us the luxuries we wanted, and have enough to retire. We hardly got to see him which strained the relationship, but I am forever grateful. Despite all that, he is not lecturing the current generation on how much easier it is today. In fact, he made convinced me to sell one of my properties to my sister at a significant discount because he realised it was impossible for her to get in.

[Itsme]

Originally Posted by T3rminator

So Kerri from Coogee has caused quite a stir. Interesting comments from boomers and the likes. Good to see some can park their ego and acknowledge the challenges of today's generation.

https://twitter.com/abcnews/status/1...689612800?s=20




No one disputed that it was hard. Every home owner has had to make a sacrifice in some shape or form, and I guess that goes the same with having kids.

I know how hard it was. Dad worked over time satdays and sundays for 10+ years just so he could pay off the mortgage, get us to school, give us the luxuries we wanted, and have enough to retire. We hardly got to see him which strained the relationship, but I am forever grateful. Despite all that, he is not lecturing the current generation on how much easier it is today. In fact, he made convinced me to sell one of my properties to my sister at a significant discount because he realised it was impossible for her to get in.

Sorry if my post come across that way, just making a comment, I know every generation will have difficulties with housing and costs but in my eyes and experience with my children, housing affordability is still obtainable.
Probably not much choice where you want to live but still obtainable in reason, no different in our day, you went where it was affordable.

[zilo]

Originally Posted by GO FURTHER

......blah..blah..blah...

IMO.

I could banter with you all day and pick things apart but wil just quote that bit and agree with you

I have three millenial kids.

one earned 500k last year the other earned 450k.

No sympathy from me....both are renting...FFS

[zilo]

Originally Posted by PG2

Does anyone else have any hints on how to save money?

Yep.

Stop being an employee..start a business.
Else you are destined to be just another loser,

[Itsme]

Originally Posted by zilo

Yep.

Stop being an employee..start a business.
Else you are destined to be just another loser,

Seen many business owner's turn losers with failures, seen plenty of employees being very successful with their careers and finances.