# Would you buy a property today?



## Editor (Oct 30, 2012)

There is talk that the Australian economy is slowing but inflation seems to be falling and unemployment is at record lows. With these mixed indicators about the economy, would you be comfortable buying a property in Australia today?

Mark


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## DylanW (Jan 26, 2011)

Mark,

I would have to say yes because we purchased our property last week


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## Editor (Oct 30, 2012)

Hi DylanW

Great answer 

I would be interested to know whether you found much competition when purchasing your property?


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## DylanW (Jan 26, 2011)

Hi Editor,

we most definitely did! I must say the Sydney property market had to have been the most painful experience I have had in a very long time.

Maybe its because we bought in the eastern suburbs where demand far out ways supply. My wife and I had been going to about 5 inspection per Saturday since Jan this year.

Not only do the properties go for a few hundred thousand dollars more than they advertise them for but most properties go to auction which is a big gamble too.

I found I would walk into an inspection which 50 other couples and the interest was just ridiculous... Then you show a little interest and there would have 4 or so offers on the table...

You spend $600 on building and pest inspection on a few places before you get extremely lucky and manage to over pay but land yourself a property prior to auction.

Here is my quick story about my property we finally managed to purchase...

Asking price is x,
We make offer of y which is $125k more than asking price of x,
agent rejects it on the spot and says make an offer of z and the owner will accept,
1 day later we make the offer of z and they come back and say they want $25k more..
At this point I knew we had already overpaid and I told them to sell the property to someone else...

2 hours later I got a call telling me they have accepted our offer on condition we sign and pay the deposit by the next day.

We rushed around and managed to get our building/pest inspector to inspect the property the next day and give us a verbal go ahead as it takes him 24 hours to do the report.

Went to our lawyer only to find out his business partner was representing another couple who are also going for the same property and are planning on making a higher offer the day we are planning to sign..

Thankfully they were a lot older than us and had not had their finances in place already and they landed up pulling out due to "to much pressure"..

Let me tell you.... Pheeeww! its a tough market out there!


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## Editor (Oct 30, 2012)

Hi DylanW

Sounds like you have certainly gone through the mill in your quest to find a property in Australia and you bring up an interesting point with regards to supply and demand. It would be interesting to see other members of the forum posting their experiences in different areas of Australia and how they see the supply/demand balance.


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## DylanW (Jan 26, 2011)

yeah I am very interested to see as well.


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## Editor (Oct 30, 2012)

Hi DylanW

What is your opinion of the local economy in Sydney and your thoughts on the medium term - as many are (again) forecasting a downturn for the economy. In recent times so many people have incorrectly forecast a slowdown in growth only for the economy to bounce back. Is this a similar scenario or does it feel different this time?

Mark


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## DylanW (Jan 26, 2011)

hey Mark,

I am no expert at all and I have only been in AU for 3 years but personally I have not seen any slow down in the market at all.

From a property point of view it has most def picked up in the past few months. I feel the property market is on its way up again. Properties that mates bought a year or so ago have sky rocketed and could sell for $200k more than their purchase price just 12 months ago.


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## nemesis (Aug 17, 2011)

When i'm travelling Perth last month, pay a visit to the local show village. I do found that property market now is in a situation of demand higher than supply. 
IMHO, the property developer currently just being conservative.


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## Editor (Oct 30, 2012)

Perhaps that is the key to the ongoing rise in property prices - lack of supply?


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## DylanW (Jan 26, 2011)

Lack of supply and continuous reduction in interest rates.

After meeting with the bank on Monday regarding interest rates the bank is 90% we will see another 2 interest rate drops still this year.

The UK is now on 0.25%! Crazy!


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## Editor (Oct 30, 2012)

Hi DylanW

It certainly is a very strange economic world that we live in at the moment - interest rates rock bottom, countries printing money to refloat economies and still very little movement in the UK, US and especially Europe. Against this background the performance of the Australian economy has been astounding.

Regards,


Mark


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## DylanW (Jan 26, 2011)

Mark,

I agree with you 100%! The Australian economy has to be one of the best in the world at the moment. The country has done a fantastic job to keep us out of most of the GFC!

Its all a big risk... Do you fix your rates or keep them variable? its much of a muchness.. personally we decided to mix up our risk with taking 50% of our new mortgage on an extremely low fixed rate of 4.99% for 3 years and the other 50% on variable which we currently get 5.17.

At least this way we get the benefits of both worlds


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## Editor (Oct 30, 2012)

Hi DylanW

You seem to have it all in hand and I personally like the idea of hedging your bets. If you had gone all out one way or another it might be right in the short term but wrong in the longer term (or vice versa).

Good luck with you new property 

Regards,


Mark


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## DylanW (Jan 26, 2011)

Thanks so much Editor! I am looking forward to moving in


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## Troy (May 19, 2013)

*Interesting...*

Hi All

This has been an interesting conversation to follow. To me it shows the complexity of property ownership, more-so for new or impending arrivals in Australia - it also highlights some areas where the dialogue becomes clouded and confusion can continue to reign.

1. There is a MASSIVE difference between looking for a property for your family home or looking for an investment property- one is guided by the heart, the other logic - caution to those that try to combine the two.

2. There is NO SUCH THING as an Australian Property market - what is happening in Sydney is different to Perth, which is different to Brisbane, Canberra, Adelaide and so on - which also is different to regional centers like, ummm - Taree. Each area of interest needs to be considered on its' merits and goals of property ownership. Do not try to take a holistic average, you will only do your head in!

3. The Australian Economy is headed for an election - the downside to that is politician's talk more than ever - and each side will try to dish the other on their economic performance/management - bringing in the short term a slight drop of public/media confidence in the economy. Gladly the political rhetoric will be short lived (come on 14/09/2013), a democratic choice will be made and we can all get back to the excellent fundamentals of the Australian economy.

4. Types of loans available in Australia are different. If you are domicile here with an established credit rating you will have access to a lot of similar loans with slight tweaks, If you are A NON RESIDENT then be careful of paying too much attention to what you hear and read - it is actually easier to get a loan as a non-resident in most cases.

5. A person or family is generally better off financially if they invest carefully in an Australian investment property BEFORE they relocate here.

6. ALWAYS support QLD in a State of Origin Contest !!!!!!


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## DylanW (Jan 26, 2011)

Troy,

I agree with all your points bar 6... Supporting QLD i nthe SOO is like support man united in soccer.... My suggestion to all, support teams you like rather than supporting them just because they win 

Other than that I totally agree with your points. Even things like "Sydney market" dont really exist.. There is a massive different in demand and price per area's. For example we have just bought a semi in North Bondi, If we had to have looked further out on the eastern suburbs such as Kingsford or Kensington we would have found more property at less value.

Someone to note about Australian area which differs from most countries in the world is not only do you get good area's but you also get good and bad streets in those area's. You will find a smaller narrower street with more apartments will sell for cheaper then a wider road with less. 

My aussie mother in law always said while we were looking, "Just remember you can always change the house but you cant change the house or location"


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## Editor (Oct 30, 2012)

If you look at the UK for example, London dominates the housing market and is in effect its own "mini-market" often acting differently from the rest of the UK. It is important that you do you research on your local property market as this will not always reflect the "general" market. Be careful and take professional advice where possible!


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