Join Australia's most dynamic and respected property investment community

Is there a correlation between property price and education/income

Discussion in 'Investor Psychology' started by eng, 24th Jun, 2015.

  1. eng

    eng Well-Known Member

    Joined:
    20th Jun, 2015
    Posts:
    114
    Location:
    Macarthur, NSW
    Is there any correlation between where one lives, and ones level of education and personal income?

    i.e. given the house prices in Sydney, would those with a higher income (and therefore higher level of educational attainment/leading to well paid careers) live closer to Sydney CBD?
     
  2. Rixter

    Rixter Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    572
    Location:
    Portfolio Perth Brisbane Sydney Melbourne
    I personally dont believe formal education level has anything to do with ones income level. Example of this is look at all the millionaires/billionaires who have dropped out of school and have gone on to achieve great success.
     
    Hanison and eng like this.
  3. Bayview

    Bayview Well-Known Member

    Joined:
    22nd Jun, 2015
    Posts:
    2,716
    Location:
    Mornington Peninsula
    Generally, I would say that a better education level will provide better employment/income opportunities.

    But of course; there are very smart people who have no money, and very average smarts folks with lots of money.

    Generally, higher income/more professionally educated folks will throng together in the same postcodes, and vice versa.
     
    Redom and eng like this.
  4. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

    Joined:
    18th Jun, 2015
    Posts:
    2,109
    Location:
    Melbourne, Nationwide
    I think you could safely say that eduction does give people higher earning potential, but it has to be the right sort of education, this doesn't necessarily mean education that's formally recognised.

    The billionaire that dropped out of uni isn't uneducated, they've simply focused their education efforts to the best effect. They're definitely not uneducated.

    Some of the highest paying jobs are certain sales roles, Real Estate sales would be a good example. There's people in this job that are extraordinarily successful but they struggled in high school. They're not rocket scientists, but they are damn good sales people and this is a skill that they spend time developing.
     
    fols and eng like this.
  5. Steven Ryan

    Steven Ryan Mortgage Broker Business Plus Member

    Joined:
    18th Jun, 2015
    Posts:
    2,458
    Location:
    Sydney & Gold Coast
    There is a trend. Higher levels of education tend to produce higher income earners, but it's not a hard and fast rule as Rixter pointed out.
     
    ej89 and eng like this.
  6. Rixter

    Rixter Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    572
    Location:
    Portfolio Perth Brisbane Sydney Melbourne
    As pointed out education level is aimed towards getting a JOB (Just Over Broke).. and as you know a JOB income alone does not get one ahead in life.
     
    Excalibur1, eng and Hanison like this.
  7. jaybean

    jaybean Well-Known Member

    Joined:
    20th Jun, 2015
    Posts:
    981
    Location:
    Melbourne
    In general yes, but as mentioned above it's not a hard and fast rule.

    In fact some types of education can lead you in the wrong direction (teach you to over analyse, leading to analysis paralysis), and to become too risk adverse ("hey I just spent 10 years doing a double masters and a PHD, I can't risk all of that! My next move has to be safe, safe, safe").

    Also a lot of formal education doesn't teach you "street" maths and "street" economics. I learned the basics of compound interest etc at school, but I never had an opportunity to use it in a realistic context until I started investing. A lot of formulas etc just aren't applicable in the real world.
     
    Hanison likes this.
  8. sanj

    sanj Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    2,155
    Location:
    Perth
    I disagree with this.

    On a personal level im completely with you, i dropped out of my degree and my brother didnt complte his either. another good mate who's a multi millionaire before 30 did the same.

    on a general scale though, people who have completed degrees do earn more than those who have simply completed year 12. there will always be exceptions to the rule but in general it holds true.

    there are some pretty extensive comparisons done here, have a look http://www.abc.net.au/news/2014-05-...ings-and-unemployment-claim-overblown/5446462

    Basically based on different methodology etc at the very least graduates earn 37% more over their lifetimes than those with year 12 education. some put the figure much higher. generally graduates have lower unemployment rates too.

    the link above uses 3 or 4 different methodologies and every single one points to graduates earning a fair bit more.
     
  9. Eric Wu

    Eric Wu Mortgage Broker Business Member

    Joined:
    18th Jun, 2015
    Posts:
    354
    Location:
    Australia
    well said, can't agree more. however, good job does provide a good starting point.
     
  10. Hanison

    Hanison Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    242
    Location:
    Brisbane
    Two mentors in my life.
    Father in law - Net worth 10's of millions, Year 9 education.
    Best friend from high school - Company turnover $1million per month. Year 12 education.

    I'm a firm believer that going to school and getting a formal education only teaches you to make a living.
    In order to become wealthy you need to get out there and learn that for yourself.
     
    eng likes this.
  11. The Silver Bear

    The Silver Bear Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    47
    Location:
    Sydney
  12. The Silver Bear

    The Silver Bear Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    47
    Location:
    Sydney
    Hmm anyone know why my image broke? I linked the image URL and can see it in preview/edit?
     
  13. Harro

    Harro Well-Known Member

    Joined:
    22nd Jun, 2015
    Posts:
    121
    Location:
    NSW North Coast
    I think the smart people don't live in Sydney!
     
    WattleIdo likes this.
  14. Steven Ryan

    Steven Ryan Mortgage Broker Business Plus Member

    Joined:
    18th Jun, 2015
    Posts:
    2,458
    Location:
    Sydney & Gold Coast
    In the word of Jim Rohn "Formal education will make you a living; self-education will make you a fortune.".
     
    ej89 likes this.
  15. Scott No Mates

    Scott No Mates Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    5,589
    Location:
    Sydney or NSW or Australia
    Definitely a link between price & income - the checkout chick generally can't afford the freight in Potts Point or Toorak whereas the barrister or company director can afford Mt Dreaded or Frankston or Elizabeth but would prefer to be surrounded by like minded people.
     
  16. Natedog

    Natedog Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    273
    Location:
    Melbourne
    While I agree in general that a higher level of education may lead to better paying jobs, it doesn't mean these people are better at allocating thier income to be better off than someone on a lower level of income or formal education.

    Keeping up with the jones's usually means a higher income just gets spent on more "stuff and things"
     
    Last edited: 10th Jul, 2015
    WattleIdo likes this.
  17. Leo2413

    Leo2413 Well-Known Member Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    5,842
    Location:
    Sydney
    Most important correlation in my mind is between:

    relentless focus/commitment/hard work and achieving massive success.
     
    Natedog likes this.
  18. skater

    skater Capitalist Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    1,421
    Location:
    Sydney
    Sometimes!

    One would assume, from your post, that the wealthy would all gravitate towards the City, but that is far from true. I live in Western Sydney. I know quite a few people who are 'very well off', and, of course, I know people from the other spectrum. I find that people have different needs & wants. Some will choose a lifestyle property, near to family & friends, and commute. Others carve out a living in their local community, while others choose to live near the CBD & their workplace, but don't be mislead to believe that ALL high income jobs are found in the CBD.

    I would also not assume that all wealthy people have a high level of formal education.
     
    Harro likes this.
  19. 2FAST4U

    2FAST4U Well-Known Member

    Joined:
    3rd Jul, 2015
    Posts:
    925
    Location:
    Adelaide
    Exactly. Generally the higher the education attainment the higher the income. There are exceptions though because ultimately income is a derivative of supply and demand, which is why a prostitute would make more money than an architect for example.

    It's the same for properties. Yes there might be doctors and lawyers who live in low socio-economic areas because they like the area or have connections with it etc., but those people are generally outliers.