Earns $60 k net for last 4 years and saves $6000

While I agree that his saving effort is a joke (I've managed to save $10K in 5 months while paying a large mortgage and not earning much more than him), the prices in Sydney are a real problem for people on lowish incomes like himself. I mean, even if he did save more as people suggest, it's going to take him years and years to save up a deposit big enough to buy anywhere within decent commuting distance of his job. Yep, he could invest instead elsewhere, but I get that there's nothing quite like owning your own place and that should be achievable even on a lowish income. Some are saying he could move and get a 2br apartment for $550K elsewhere in Sydney. is that really achievable these days?

And if he moves away from Sydney, then there's one less nurse in Sydney. Big problem if all the nurses who currently rent decide to do this and a massive shortage of nurses ensues.

Just my thoughts.

 

Great comment. I totally agree. I really wonder what the result of the current property prices will be in say 10 years time.

 

Yes, like I said, property prices in Sydney are ridiculous but think about this....

He pays 11k /yr in rent & saves at best 1k /yr. That's 12k /yr which is enough to pay Interest Only at 4% on 300k...... C'mon.... can you see the nonsense here? His spending means he'd struggle to buy a house almost anywhere in Australia with a decent population base (i.e.. 100k or more)

No need to dramatise that all nurses may not be able to afford to live in Sydney.... his spending is totally out of control. If he rentvested for a few years he may find he's a step or three closer to his goal, which I might add he is currently doing SFA to achieve......

FWIW, some of us moved out of the capitals to somewhere we could afford rather than whine about how the world & the market is against us.... Yes it is expensive in Sydney.... deal with it or move!

 

Exactly - there is a delink in income vs house prices in pockets where services are required. Sure, he spends a fair bit, can't save, etc etc.

Nonetheless, speaking more broadly, beyond the individual situation, market outcomes have produced a 'rental indefinitely' type outcome for single borrowers in some parts of sydney.

E.g. a single person trying to buy an owner occupier on 60k gross with min living expenses is only going to be able to get $300-350k from a bank anyway. If your a nurse at RPA, etc - you can't realistically be expected to live in a one bedder in Liverpool (what you can buy for that price) - 90 minutes away. Coming up with the deposit on that type of income is also quite difficult and does take time/creativity.

Compare the equation to every other capital, where you have dwellings that match up with serviceability close to jobs.

• e.g. in brissy you'll get yourself a new 1 br in around the CBD or anywhere really,
• in adelaide you can probably buy 2 decent properties within 30 mins!
• in tas you'll get a nice backyard,
• in melb you can buy a city unit, etc.
• in perth, buy yourself a H&L with a tiny deposit!
• in CBR, get yourself a new shiny unit 10 mins away from everything.

Community frustration and FHB frustration is more common/heightened now than ever...expains why housing affordability will likely be the centrepiece of this budget come May and a big part of the NSW budget in June.

 

He should be able to get a nursing jon anywhere...there is a shortage of nurses

 

He could definitely borrow a bit more than $500,000 on his salary, which has to be over $90,000.

Also, medical people can salary sacrifice into their mortgage, I believe. He has chosen not to work extra shifts...

 

I have to say I'm extremely disappointed with this thread... I read the title:
"Earns $60 k net for last 4 years and saves $6000"

and thought someone had finally cracked a "secret" investment that they were going to share with us all, that made money and saved money at the same time!!!!

 

Though the guy who is the subject of the post isn't earning $60,000 gross, but $60,000 net!

 

Yes, it's net but the main point of Redom's post is still correct.

 

Interesting, I didn't catch that it was net. Have no idea about nursing salaries, so assumed since people always say they're low that his quoted salary was gross. In that case he earns way more than me and should have been able to save more. (I had a $500,000 mortgage + investment loans I had to carry myself for the past 5 months and I've still managed to save $10,000 in that time)

However it's still going to be problematic for low income earners to ever conceivably enter the Sydney property market as buyers. I imagine that even renting is going to be out of reach for many of them. What happens then? A lot of businesses won't be making enough money just to pay their staff more, so there will a mass exodus of low income earners who do the low paid work. Not good for Sydney.

 

That's closer to $87K per year gross, which is not shabby.

Award rate for medical professionals are different per state. One that I found for NSW
http://www0.health.nsw.gov.au/policies/ib/2015/pdf/IB2015_034.pdf

 

I did notice that it was net - i was just speaking generally to note that it is a different equation in Sydney. The above post was largely about single borrowers. There are plenty of sydney siders on 60k gross p.a. Incomes here aren't wildly higher than the other cities i mentioned.

Speaking to families and what they want, usually its broken down into three key parts - close to work, good schools for the kids, and accessibility to hospitals usually (especially for little ones).

Outer western areas though, where housing is relatively more affordable, there aren't that many good primary public schools relative to closer ring areas (an issue for most parents). Time to CBD is longer given the size of the city is bigger.

Looking at housing affordability and city design, there are some distributional issues with public goods. Simply making houses more affordable west doesn't only do it, you need the corresponding infrastructure with it and ideally more jobs out that way too. The 'latte' line that broke down school rankings had a good example of this.

For those interested, this commentary is really on point about the Sydney affordability debate now (hope this works!):

Deteriorating housing affordability in Sydney and Melbourne due to both demand and supply

 

I intially sympathised but then I gave it some more thought.

At his age I had the same income, 4 kids, wife staying at home and we had two IPs in the Western suburbs of Sydney with approx $250k in equity. We also had the occassional holiday but obviously not to the extent of this fellow!

 

So he has about 20 k pa FU money

Allow $600 pw of living expenses out of the $49k.

 

Nurses are under paid for the work they do, that's for sure. But they always have a job, can do overtime and awkward shifts for higher pay and, let's face it, 60K net aint bad. He can also improve this through specialisation, I believe.
While I can understand his point about not wanting to get burnt-out, it probz won't happen at 30 unless he needs to do some 'internal work' of his own.
I reckon sharing with that crowd could be more stressful than being at work!
He could definitely get a 2 bedder for 5-600K and share with 1 other. Maybe try around some major trnasport hubs like Ashfield, Parramatta, Liverpool. Why do they think everyone doesn't live in the eastern suburbs?
Either that or get out of Sydney!
There are plenty of nurses, teachers, firemen and policemen living in comfortable houses with their partners. If Sydney can't hold them, there'll be a mass exodus to the regionals. That would be good for everyone.

 

This guy must be having an awesome life if he spends every dollar he earns on a $60k net pa salary. He manages to save $20pw so he's got some discipline to stash some away for a rainy day.

 

If the 5 of them saved they could buy the property they are in and then build a deposit with some capital gain.

 

There are no 2 bedders in Ashfield for 600k. More like 800k.

Except people who need nurses, teachers, police officers, etc.

 

lmao
QUOTE="Cimbom, post: 368113, member: 446"]
Except people who need nurses, teachers, police officers, etc.[/QUOTE]
....which is why there'll be a mass exodus!

 

He could rent the second room to a young couple even.