Why is Australian residential property so incredibly expensive?

[Battleneter]

Originally Posted by WildOnions

I want to make it clear that I'm talking about rental properties. Rental vacancies were once (in my city) around 5% and now they are at 1.8% roughly. This provides property owners with a premium rent and has no doubt contributed to people thing "what the hell, let's just buy"! Both situations are a boon for the government. This is Australia, there's no shortage of land.

I do understand what you are saying, but first time buyers are entering the market in record low numbers, so the reality is the renter pool is only growing while the percentage of the population that owns their own home is falling, that's fairly undisputed.

To many people increasing the LVR requirements may seem counter intuitive thinking it will hurt first time buyers, BUT it hurts speculators/investors far more many already leveraged up to their teeth, stops them buying more.

When residential housing falls below the returns of investing elsewhere (and its very close now), people exit the market and house prices ease.

Understanding the "major" forces behind what is happening is the first step to solving it, your certainly not going to get the facts from the media, under supply my ass and that includes most of Sydney :P

[BCC_1]

Originally Posted by WildOnions

This is true. I would also say that apartment living seems to attract high rents because of the novelty value and because there is simply not enough of them. In most cases you can pay almost the same for an apartment as you would for 2/3 of a house. Flats here in Adelaide are expensive, the closer you get to the city and you forgo a parking space.

I don't know about the novelty factor being a reason. I guess for some it might be and new apartments come with a lot of bells and whistles. I was invested in a development in Sydney that included a rooftop cinema. Made a pretty penny on that, almost all went to Chinese buyers.

[tilt10]

Simple. Lack of decentralization. Very few countries in the world like Australia.
Absolute disgrace that both sides of Australian politics in Australia have not tried to decentralize.

[Samuel,J]

So what do you call the state/local government system of government?

[Battleneter]

Originally Posted by tilt10

Simple. Lack of decentralization. Very few countries in the world like Australia.
Absolute disgrace that both sides of Australian politics in Australia have not tried to decentralize.

Hardly anyone reads back.

http://www.whocrashedtheeconomy.com/...uk_sep2012.png

MOST countries in the OECD had rapid price growth from exactly the same time, Australia is NOT different at all.

90% of the issue stems from banking deregulation in the late 90's followed by (insert reason here).