A generation of Renters?

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Renee

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Are people forced to pay these inflated prices because they simply can't afford to buy?


Sydney rents hit $500/wk
From: By Nicki Bourlioufas
November 29, 2005

MEDIAN rents for two-bedroom dwellings in inner-city Sydney jumped 5.6 per cent to $500 a week in the September quarter from a year earlier as landlords enjoyed a tightening rental market.

Rents for two-bedroom homes in Sydney as a whole jumped 3.6 per cent over the year to $290 a week, or by $15, according to the Rent & Sales Report from the New South Wales Department of Housing for the September quarter.
During the quarter alone, the median rent for two-bedroom homes jumped $10 a week from the June quarter.

Median rents rose $5 a week in middle and outer suburbs from the June 2005 quarter. Median rents remained unchanged in inner suburbs over the September quarter.

Australian Property Monitor's Research Director, Louis Christopher, said the figures showed the first significant rise in Sydney rents for four years.

"The rise has been as a result of many would-be property buyers waiting on the sidelines for housing prices to fall further and the fact that the supply of new rental properties has quietly reduced over the last 12 months."

Mr Christopher believed there would be more rental increases to follow for the next 12 months, which is good news for suffering property investors but bad news for tenants.
Reflecting the pressure on inner-city rents, median rents for two-bedroom units rose 5.7 per cent in inner suburbs over the year, 4.0 per cent in middle areas and 4.3 per cent in outer suburbs.

Two-bedroom flats in Auburn recorded the largest annual increase in median rents (up 13.6 per cent), followed by Leichhardt (up 11.4 per cent) and Blacktown (up 10.5 per cent).

The largest annual increases in median rents for two-bedroom houses within Sydney were recorded in Canterbury (up 12.0 per cent) and Auburn (up 8.2 per cent).

Rents have climbed sharply in Sydney and across Australia as people seek to rent rather than buy homes with housing affordability hovering at historially low levels.

During the quarter, the number of new rental bonds lodged with the NSW Government rose 5.2 per cent in Sydney, reflecting the strong demand for rental properties.

A shortage of new housing stock is expected to keep upward pressure on rents and housing prices.
 
Australian property 'over-valued'
From: AAP By Shane Wright
November 29, 2005

AUSTRALIA has beaten the world in over-valuing its homes ? and property owners should prepare for price falls until late next year.

A special Organisation for Economic Cooperation and Development (OECD) report into housing markets in the world's richest nations has found Australia is the most over-valued property market.
The report was prompted by sharp spikes in property prices in developed nations in recent years.

The OECD found the estimated over-valuation of Australian homes in 2004 was 51.8 per cent. The next highest over-valuation was in Britain at 32.8 per cent.

That over-valuation was coupled with the second highest mortgage rates in the developed world, at an average of 7.1 per cent ? only eclipsed by New Zealand where they were eight per cent.

There have been plenty of signs of the slowing property and housing market since prices peaked early last year.

But the OECD believes prices are likely to fall for some time.
Since 1970, Australia has had six upturns in the property market ? the highest number of the developed world. Those upturns have averaged 14.3 quarters, or about 43 months.

During those upturns, average prices have increased 31.6 per cent.

But between the first quarter of 1996 and the first quarter of 2004 Australian real house prices climbed 84.7 per cent.

Downturns in the Australian house market have averaged around 10 quarters, or 30 months, with an average price fall of 10.1 per cent.

The current downturn started in Sydney and Melbourne early last year, which means on the OECD's figures, prices are likely to fall ? or not rise ? until the fourth quarter of 2006.

The OECD said the strong growth in house prices in developed nations was unprecedented, partly because of how it has not mirrored the global economy.

"The current house price boom is strikingly out of step with the business cycle," it found.

The OECD pins down several factors for the way people had bid up the price of houses across the developed world.

It suggests a lack of housing stock, higher migration levels, low interest rates and more competition from lenders have all contributed to the strong rises in prices.

"A combination of generalised low interest rates across OECD economies, coupled with the development of new and innovative financial products, have no doubt played an important role," it said.

"In Australia, increased competition among credit providers has contributed to the doubling of the number of products provided by lenders."

Another factor with special importance to Australia is the growth in people investing in property specifically to rent.

Buy-to-let mortgages, as they are called internationally, have grown in most nations. Around seven per cent of loans in Britain are for investment, while in the US 15 per cent of home sales last year were for investment.

But in Australia, around 30 per cent of mortgages (by late 2003) were for investment. In NSW the rate was 42 per cent of all mortgages, and in Victoria it was 35 per cent.

The OECD said even a small rise in interest rates could prove problematic for the housing sector.

"If house prices were to adjust downward, possibly in response to an increase in interest rates or for other reasons, the historical record suggests that the drops might be large and the process could be protracted," it found.



Seriously, lets just go live in trees!!!
 
Seriously, lets just go live in trees!!!
Click to expand...

Seriously why dont you come and live in melbourne? :angelnot: Houses for renting AND buying are waaaaaaaaaaaaaay cheaper and more beautiful than the ones in Sydney :razz: AND safer :gunsss:
 
Townsville is the best place to move to right now in Australia. It is Australia's biggest growth area which means for investment properties, the place to be. With a major Army Base there, you will also be well protected.
 
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