All fishermen have a story about “The one that got away ..”
I think all property owners are the same!
Property never seems affordable, or inexpensive, at that time. It is only in retrospect the lost opportunity is truly realised. “If only .. “
I first moved to Melbourne from the family farm in North Western Victoria in 1980. At that time the median house price was $39,500. “If only .. “
Of course at that time I was a student, it was to be many years before I could afford to buy my first property.
Melbourne’s population then was 2.84M. Amazing population growth since. All around a single CBD.
The average wage in 1980 was $13,458, so the median house price was around 2.9x average income. That was considered high at the time.
The multiple has increased since to around 9.7x. Reasons for such continual growth in the median price are far more than merely wage growth, or inflation.
Why?
There are multiple reasons for that growth including:
Decreases in interest rates. In 1980 home loan interest rates were 10% - with no Mortgage Broking industry at the time to assist purchasers. Lower interest rates today assist affordability.
Most families survived on one income back then, whereas today dual income family purchase of property is the norm.
There is an increasing shortage of accommodation available where people want to live. The CBD is job central. Everyone wants to live near to their place of work. More people, more demand for the same property.
Every 30 year old today wishes they had the opportunity to buy property in their parents day. Their kids will probably say the same thing in 20 years.
Was 1980 a great time to buy property? Absolutely! The fact is any time in Australia’s past has been a great time to buy property. And I believe today is no different.
Australia’s population continues to grow, with most of that growth in the major cities. Economic conditions are stable. It is most likely prices of premium and quality property will continue to grow as they have in the past. Time in the market is the key.
If you are a believer:
It is important you do your research.
Do your budgeting, do not over-extend.
Buy quality property.
And speak to your mortgage broker!
Daryl Borden, your Dingley Village Mortgage Broker, Ph. 03 9511 8883 ACL 392184
Integrity Finance Australia– Changing Lives