Complain or Conquer, is housing affordability really the issue?

Absolutely agree with OP. Personally I currently hold a full time job plus run an online business that roughly equals the income of the job plus have a small family.

All profits from my business go into investing in property. No fancy cars, no smashed avo, no complaining about housing affordability just focus on saving and investing plus hard work.

 

He's right. Sydney prices are a joke!

 

O.K......well hopefully here is an example for first home buyers to extract their heads out of the clouds and buy something genuinely affordable in an area that whilst not Toorak by any means, at least offers major city amenities and employment opportunities at a price that is negligible by most city standards.

1 Gull Street, Norlane VIC 3214 - House For Sale - 2013576730

$169K-$189K for this sub-divided 60's house. Still, you can probably get a loan with less than $20K deposit, especially once the regional bonuses kick in after July 1st if this stays on the market by then. In any case i'd like to think that if someone wants to get into the market, a place like this could well be the foot in the door. Sadly for many, some postcode snobbery might kick in and people will complain about not being able to afford a new place twice the price or more....

 

Apparently the Ryde property on Lane Cove Rd (major artery for those not in Sydney) that Sam was talking about had a price guide of $1m - $1.05m and subsequently sold for $1.3m to someone displaying irrational exuberance.

The Sydney property market currently is just like the tech boom of 2000, and when it comes apart it is just going to be like a biblical event.

Note that I wouldnt have the foggiest idea when this will happen.

And I don't even like Sam that much, but his video was outstanding.

 

Someone is going to set your bush on fire? We'll be in a world of pain.

 

SNM (no pun intended). I've been in a number of bushfires.

They aren't pleasant.

 

Markets always move in cycles. When a cycle goes one way for too long, people forget this.

 

I'm halfway reading through this very interesting thread. Currently at page 20, but I've had enough (for the time being) and want to have my say

Let's see. Your GF had $40,000 student debt. I came here as an international student paying full fee $30,000 per year, I did my bachelors for $25,000 per year for 3 years = $75,000. I couldn't qualify for permanent residency (PR), so I took a Masters degree ($30,000) and also did some unpaid work experience projects, English classes and aced the tests and got integrated into the community to finally earn my PR (had to pay $5,000 for the application fee).

I started out with a debt of $110,000 which was funded by most of my beloved mother's retirement savings (bless her!) which she loaned me. She toiled her entire life and told me "Son, during my generation, we never had the privilege to go to high school or university, especially the ladies. I worked hard all my life so you can go to a prestigious university in Australia, Canada or the UK". That's how I ended up here.

I worked in uni doing jobs that paid between $7 p/hr to $10 p/hr cash-in-hand to fund my rent (international student accomodation was $12,500 per annum) and food. I was pleasantly, pleasantly surprised to have ended up $8,000 positive upon graduating. So at this point, $8k in cash, but I still owe my mother $110k.

Year 1 of working - I started full time employment - $50k p/a. Took a second job $8k p/a. Did a couple of side hustles (buy and sell on eBay) $2k p/a. Scrimped on everything and paid down a bit of that debt.

Years 2 to 4 of working - got my pay bumped up to $80k p/a. A lot more side hustles where I could, around $4k p/a, to fund my little luxuries in life (new second-hand smartphone on eBay, massages with Groupon vouchers, steak eat outs with Groupon vouchers, etc). I figured if I split my earnings into 2, I would be able to have more forced savings and forced earnings : Primary FT job's earnings would all go into the "savings bucket" (debt repayment, savings). All other earnings and side ventures would go into the "spending" bucket (groceries, utilities and internet, mobile phone bill, eating out). I paid down debt to $30k and had my separate rainy-day savings of $40k.

It was 2014, 4 years out of uni and I decided that it was time to buy a property. Renting was getting me nowhere, and I was very annoyed at agents inspections, landlords wanting to sell and the general feeling of "going nowhere" with all the savings I've amassed over the years.
I told my mum that I would pay down that $30k over another 3 years if that's ok, and she said that was more than fine.

I leveraged to a 90% LVR, no LMI as I was working for a bank. With a $85k job, a $5k bonus that year, I purchased a $450k 2 bedroom Melbourne CBD apartment.

Fast forward 3 years to 2017 now, I have 2 CBD apartments, a Home + Land package that is settling in a few more months time, and have brought all my loans down to under 80% LVR. I am significantly in positive cashflow on all properties, meaning I have passive income coming in every month. Also, debt to my mum for the education loan is almost over, $10k left to repay and that's the end of that.

So, from -$110,000 in debt to owning several properties - not impossible. I hate whingers and people who have it good but think it's all doom and gloom. Guess what, there's always someone else out there who had it harder, and are more successful now.

Forge your own way through. Always try to get better, get a better job ... or better yet, get better at your current job and increase your value to your employer. That'll increase your primary day-job's take home pay. Then, take up a few side jobs. Learn to hustle on the side, score a Coles or Woolies voucher here and there. Buy stuff from bargain sites & sell them at a profit. Provide a service walking dogs, house sitting, gardening, whatever that has a high dollar-per-hour ratio. This will give you extra income to pamper yourself so you don't get burnt out.
Better yet - this also takes away all your spare time, so you can't go shopping, or even lazily browsing the internet looking for the next fad to buy into (new iPhone, new laptop, new shoes, new handbag, new clothes)!

At the end of the day, you also have to arm yourself with the knowledge and work on the numbers yourself.

A 600 m2 standalone house in Malvern East not within your budget ($1.8m)? Then look for a cheaper place.
A 500 m2 standalone house in Hawthorn not within your budget ($1.4m)? Then look for a cheaper place. Maybe try a townhouse instead.
A 350 m2 townhouse in Altona is $750k. Still not within your budget? Then look for a cheaper place.
A 350 m2 townhouse in Greensborough is $650k. Still not within budget? Then look for a cheaper place. Maybe try a unit instead.
A 2 BR, Ground Level unit with some patio area in Fitzroy / Brunswick / Brunswick East/West is $550k. Still not within budget? Then look for a cheaper place.
A 2BR, modern build apartment in South Melbourne is $480k. A 1BR is about $350k.

There are plenty of types of properties to purchase. The areas I've mentioned are good, blue chip suburbs. I can come up with better numbers in other lesser-known suburbs in Melbourne, but just want to prove a point.

Don't read too much into what the papers tell you (there's always a political agenda or to create drama / stir up ****). If you don't have much money saved up but want to get into the property market, this forum is your best resource. You can do so through apartments, land, house and land packages, partnerships, etc. You just need to have a mindset of "I'm getting something, no matter what it takes".

My take - yes, most apartments may be mediocre investments, most pros here are probably shaking their head with my choice of investment properties. But I'm happy with my choices and I'm pretty happy with my +ve cashflow IPs with CG slightly above CPI, so I'll leave it at that. My main point is if you know how to work the numbers, there are always properties that will make you money. The critical thing is being able to purchase below the median price, but be confident that the location (location, location, location) is able to attract tenants (or if you're living in, that you'd like to live in that area).

- rant over -

 

@JayWin great story and journey mate, your a champ. Congrats

 

Hey Jay Win,

You better stump one of those places for your farsighted Mum, because it's probably time to pay the piper.

And, whilst you're at it you'll get the prawns and oysters allocation for Xmas lunch.

Permanently.

TV

 

Great job with the online business!!
Could I ask what it is?

I have now been asked to get involved in two new startups both very exciting and after being hesitant think I'm about to start taking the plunge.