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Old 02-07-2018, 12:24 PM
 
1,162 posts, read 1,268,507 times
Reputation: 1629

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Quote:
Originally Posted by DKM View Post
It takes time to save that money up. Took me several years to get to the point where I could buy my first cheap townhome. Many years of paying it down and a slow price appreciation later and I could move up again. Repeat, 7 years later and viola, sell it for a quarter million down on nearly a million dollar house with income in the 120 to 150 range before age 40. Its about budget first. I don't try to impress anyone, my class is in my behavior. Raising a family on single income living the dream... again takes TIME and SAVINGS. Mortgage, insurance and tax is at 40% of gross income, no problemo. People making more than me whining they can't live in my wonderful neighborhood...
250k down on a 1,000,000 still results in a larger amount than I would be paying on a 600,000 home, both in actual dollar amounts and percentage of income.

Iím not sure of the lesson here.
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Old 02-07-2018, 01:23 PM
 
Location: Formerly Pleasanton Ca, now in Marietta Ga
4,114 posts, read 3,409,203 times
Reputation: 5648
Can we at least know where you are moving to?
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Old 02-07-2018, 01:36 PM
 
Location: NY/LA
3,086 posts, read 2,554,874 times
Reputation: 2382
How much is it to rent there?
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Old 02-07-2018, 01:47 PM
 
Location: Sydney Australia
597 posts, read 303,249 times
Reputation: 868
Quote:
Originally Posted by SportyandMisty View Post
What are the typical tax consequences & implications of purchasing a house in Sydney?
If the house is owner occupied the interest is not tax deductible. So no immediate consequences in that way.But if you live in it for a year then there is no capital gains tax on it when you sell. On purchase of any property there is a tax paid by the purchaser called stamp duty. On a house worth say 1.5 million it would be perhaps 75k.

If the house is an investment property and rented out the interest is a tax deduction along with all the usual costs of ownership, like rates and depreciation. What is controversial is negative gearing, in that if the property is running at a loss the amount can be deducted from your other income. There is a fifty percent capital gains tax exemption on sale if the property is held for a year or more. This encourages investment in residential real estate but pushes up the prices.

Unfortunately the price of real estate in Sydney has got so high that if a family are wanting to upgrade from, say an apartment worth 800k to a house worth 1.5 million, they have to allow at least 100k for the costs involved.

All of this is why our state government is running a massive budget surplus. Which is good and bad. Good in that the surplus is funding massive and much needed infrastructure projects (parts of the business district are a total mess because of a light rail project) and bad in that it is so difficult for first home buyers to get a foot in the market.

You people in the US are fortunate that you have more options to move to cheaper areas. Many professional jobs here are Sydney and Melbourne specific and people have to work out a way to afford these cities.
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Old 02-07-2018, 02:38 PM
 
Location: Forests of Maine
29,738 posts, read 47,525,692 times
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In my town the median household income is $35,714, and the median home price is around $131k.
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Old 02-07-2018, 03:05 PM
 
Location: Prepperland
13,124 posts, read 9,212,549 times
Reputation: 8988
Unfortunately, if you wish to live in conformity to the status quo it will appear maddening to buy or own a house.
The price is inflated by taxes, interest (usury), insurance (gambling), and speculation. The type of house and land use is constrained by zoning and building codes. And may be further degraded by "Home Owner Associations."
The money token (federal reserve note) is a worthless IOU that keeps losing buying power (aka "inflation") despite the money drought.
(Who has all that "too much money" chasing too few goods?)

On the other hand, you might inquire about absolute ownership of private property (not to be confused with 'real estate') which is not subject to ad valorem taxes, nor any other infringement. . . and is constitutionally protected.

Don't believe me - go read the law - write polite questionnaires to your public servants.

Land, private property versus estate

http://www.city-data.com/forum/7785132-post22.html
http://www.city-data.com/forum/16975311-post119.html
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Old 02-07-2018, 04:17 PM
 
Location: Brisbane
3,357 posts, read 5,185,501 times
Reputation: 2685
Quote:
Originally Posted by MarisaAnna View Post
If the house is owner occupied the interest is not tax deductible. So no immediate consequences in that way.But if you live in it for a year then there is no capital gains tax on it when you sell. On purchase of any property there is a tax paid by the purchaser called stamp duty. On a house worth say 1.5 million it would be perhaps 75k.

If the house is an investment property and rented out the interest is a tax deduction along with all the usual costs of ownership, like rates and depreciation. What is controversial is negative gearing, in that if the property is running at a loss the amount can be deducted from your other income. There is a fifty percent capital gains tax exemption on sale if the property is held for a year or more. This encourages investment in residential real estate but pushes up the prices.

Unfortunately the price of real estate in Sydney has got so high that if a family are wanting to upgrade from, say an apartment worth 800k to a house worth 1.5 million, they have to allow at least 100k for the costs involved.

All of this is why our state government is running a massive budget surplus. Which is good and bad. Good in that the surplus is funding massive and much needed infrastructure projects (parts of the business district are a total mess because of a light rail project) and bad in that it is so difficult for first home buyers to get a foot in the market.

You people in the US are fortunate that you have more options to move to cheaper areas. Many professional jobs here are Sydney and Melbourne specific and people have to work out a way to afford these cities.
I dont think that many jobs are specific to sydney or Melbourne. Unless you are in a position to be a CEO, or cure some rare diseases, or maybe top investment banker etc. Its only a small fraction of the workforce.

As far as median incomes are concerned Melbourne is actually the second lowest major city in Australia (Adelaide been the lowest) and Perth is by far the richest.

Housing costs are far more about supply and demand in my opinion.
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Old 02-07-2018, 05:24 PM
 
Location: Formerly Pleasanton Ca, now in Marietta Ga
4,114 posts, read 3,409,203 times
Reputation: 5648
Quote:
Originally Posted by Harrrvy View Post
That's because the inputs to your model are not accurate. What the median salary is in a town is almost completely irrelevant. The median salary in a town includes people that are renting, people that are retired with paid off homes, and people that bought 10 years ago when prices were lower. What would actually matter is what is the median salary of the people that bought a house in the past 12 months. That would actually give you a good idea of how you might potentially stack up.
You might not be able to buy at 180K due to your risk tolerance which seems to be extraordinarily low. Other (most) people would be very comfortable spending 20% of their gross income on a mortgage payment. You have chosen not to be. Therefore, until 1) you make more money; 2) you have saved up a down payment to reduce your mortgage; or 3) housing prices fall; you will not be able to buy a house in your desired location.
those are very good points
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Old 02-07-2018, 07:46 PM
 
8,127 posts, read 4,460,899 times
Reputation: 8750
the median house in my neck of the woods is $112,000. maybe its the neighborhood and not the house
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Old 02-07-2018, 10:08 PM
 
1,017 posts, read 740,553 times
Reputation: 1611
Quote:
Originally Posted by Harrrvy View Post
That's because the inputs to your model are not accurate. What the median salary is in a town is almost completely irrelevant. The median salary in a town includes people that are renting, people that are retired with paid off homes, and people that bought 10 years ago when prices were lower. What would actually matter is what is the median salary of the people that bought a house in the past 12 months. That would actually give you a good idea of how you might potentially stack up.
That's another good way of putting it. My guess is if you looked at successful buyers in city like the OP is interested in, the median income for the current buyers would be much higher than the city median.
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