Sydney still cheap says Lord Andrew Hay

Sydney real estate 'cheap' and there's no bubble, says Lord Andrew Hay

 

Sure!!! For foreign investors maybe!!!!!! Do we really want to be a nation of renter's with our landlords being foreign investors?? I think not!!!

 

Personally, I wouldn't want an Australia filled with HNW and UHNW individuals - they're parasites to the host country.

With tax minimisation, they give almost nothing back, and good luck buying an investment property after they all move in, they'll be buying everything in site (so they can enjoy high returns at the cost to Australian families).

Silicon Valley is a good example of this, the Google / Apple workers are on such obscenely high wages that the average person was forced out due to high cost of living and house prices.

 

Perth is just as stable as Sydney and Melbourne and at the same time zone as Asia yet you don't see the UHNW individuals setting up here. With $1.5T of household debt I don't see Australia avoiding a massive recession in the near future - especially when the interest rates rise and a rating downgrade likely when it all starts going pear-shaped.

On top of this, everything he says is bulls**t;

First-class educational institutions for their children: which have been going downhill for years
mature financial markets: I guess he means the huge debt and the fact we're overdue for a recession (although WA is in a depression apparently)
transparent regulatory systems: REALLY?
uncorrupt governments: that accept bribes and are controlled by vested interests?
good eco/green conditions: except for our outlook on coal and lack of financing on eco / sustainable energy.

I'd love to live in the Australia he's selling!!

 

Comment made between his champagne breakfast and polo session.

 

Whats HNW and UHNW individuals got to do with the average price paid for a property in Sydney or Melbourne but? I could maybe understand if your talking about the prestige market.

I dont think it's currently a great time for foreigners to buy anyway.
We are at the bottom of our interest rate cycle, with an upward bias going forward.
And I think there's still a good chance for our dollar to ease.
If I was a foreigner I'd start doing my research now, but holding off for atleast 12-24months to get a sense of direction on rates and the dollar. Would be a real pincer moment if they both went against you.

 

I tend to think international HNW and UHNW individuals wouldn't care about the little things like domestic interest rates... they'd care more about the politicial environment, how clean, free and welcoming to foreigners the country is, the stability of the country and Government, the future prospects/outlook of the location and what taxes they'd be liable to pay. Also availability of well regarded educational institutions if they have kids.

 

people see the world from their spectacles

 

Difficult for foreigners to access loans in aus

 

I think Aussie have lived in the age of entitlement for so long that they cant help but nag and bicker about foreign investors.

Do you know how the rich foreign investors became rich? we bought their expensive iphones, cars, oil, Tvs, computers, [insert material goods here] Australia issued them 457 visas so they could establish a whole range of consulting companies and bring cheap labour into Australia sending money back home, we helped aussie companies to offshore jobs. Telstra now has the largest part of it's operations in south east asia. Foxtel is in south africa and the list goes on and on.

I still remember the days when certain people would get pregnant to get baby bonus and buy a flat screen or go on holidays somwhere or buy the latest laptop.

We dont make anything in this country to export except for raw material and even that is largely foreign owned. We are a fully consumer country.

Of course they will become rich and of course they will buy everything they can in a safe haven, wouldn't you if you were in their position?

 

Did anyone see the interview he did on sky business yesterday? The host suddenly had a posh English accent to match his.

 

Oh dear.....snowflakes

 

Bwahahaha. Not even the courtesy of an April fools day release.
Lordy, lordy Sydney is cheap. Yes! It is a veritable bargain. In fact Sydney is on special

 

Or monocles in this case perhaps?

 

I would agree with this...
These guys won't care about Australian IR..their funds are likely independent of Australian IR.
I also agree with the point tenex made about consumer vs producer societies.
Producer societies have much much more scope to grow, be innovative, potential $$$ wtc than consumer societies (although both cannot live without the other).
Take a common iPhone for eg..only so many ways you can use it as a consumer/ create value.. .but many more ways you can enhance it/create value as a producer...

 

That consumer/producer thing is such a beaten up topic dont know why people still bring it up. Time and time this has been proven that manufacturing alone is not sustainable. It is the services part of the economy that will create a high income society. All high income countries in the world have most of their gdp coming from services and low income countries doing manufacturing.

 

Indeed. Travelling in SE Asia currently and offer a couple of observations:

1) Singapore is a wealthy country but imports everything, with services (shipping, finance, tourism) generating vast wealth. Private apartments US$5m, 'bungalows' in better parts of town US$25m. Comparitively Aussie 1/4 acre is cheap. Housing affordability? 80% of Singaporeans buy government subsidised apartments US$250-350k. Lots of expansion underway.

2) Our Vietnamese guide bought her 20m2 apartment for AU$40k. That's equivalent to paying AU$1m for 500m2...not far off Melbourne middle ring pricing.

To me this shows Australia cannot rely on natural resources to grow, it must move into gi-tech services and "value add" (hi tech as India/Phillipines have corned market for cheap services labour). Furthermore it would seem we will withess the end of the "great Aussie dream" with high density living becoming the more affordable option for gen Y and beyond.

 

Within a global marketplace Sydney does look cheap, there’s no doubt about that,” says Lord Andrew Hay, global head of residential at Knight Frank.

Agree. Sydney is still cheap. Why those experts compare Sydney prices with other large cities? They need to compare Sydney with every city/town in the world as we have 200K+ new migrants every year (3rd of them go to Sydney), and they are not from those large cities. Many of them find Sydney affordable compared to the places where they lived before. Also they can control expenses more effectively than locals, so they can get a 10-20% deposit much quicker by saving more.

 

2. It is much easier to save up $40K even on Vietnamese wages than it is for the much bigger $1mil price tag and 500m2. To the average Asian, they don't need 500m2.

Why would you want to join a race to the bottom with going into "high services"? You are already way behind the tech curve ball, USA, Germany and Japan have that down pat. China produces way more engineers and scientists than we do and would undercut the heck out of us price wise.

 

Just saying that relatively land values are similar and perhaps Aussies may have to reconsider accommodation options in a global market (not suggesting its desireable).

As for economy, 'riding the sheeps back' (or mining etc) really isnt a sustainable plan nor one that can be expanded. Aus has a long list of distinguished inventions. We need to learn to exploit our talent rather than export it.

Maybe WiFi is one example we failed to exploit. On the other hand Atlassian software is perhaps an example. Both are value add/hi-tech.