Sydney - the coming correction 2018-2022

yeah, zetland is not bad, but I like erskineville area much more... there is a huge redeveloped Sydney Park, + bike tracks for kids, and one more (smaller) is going to be built soon. 10 mins to CBD, 20 mins to Maroubra/Coogee, 30 mins to Bondi/Cronulla... one of the best primary school, two ovals, lots of restaurants in Newtown, multiple shopping centers including fish market (Faros Fros), burnings, The Grounds, and it will have WestConnex link soon near St Peters, so commute time to the western suburbs will be much shorter, it will increase the prices there for sure.

while erskineville is dense... it's not dense like zetland. IMO 5-6 storey buildings are ideal. Too many high buildings in one area create lots of issues with transport, parking, traffic, schools, ecology, noise, etc.

 

agreed.. but i tell you wat about zetland/waterloo/newtown/erskinville or any innerwest/south numero uno problem is. TRAFFIC JAM

 

people who live there are mostly professionals who use mostly public transport (trains) which is very fast, it takes 20-25 minutes door-to-door if you work at any place in CBD, or 15 minutes walk if the work is in Alexandria or Eveleigh (Australian Technology Park). And it's not too bad if the work in North Sydney/Chatswood or Bondi junction.

on the weekends there is no traffic there, so people can reach most locations within 30 minutes, and any Sydney location within 1 hour, whether it is Royal National park, or northen beaches or penrith area

 

A unit in my area just sold for a record price in the building, very old 2 bedder in North Bondi. No views. No garage. Wealthy(ish) young Greek couple bought it. $1.3m. 4 others missed out.

It's all about demand and supply in strong demand areas imo.

 

Yep...definitely softer... I would consider a 15-20% reduction in prices over 12-18 months to be the minimum required to call it a correction though, and we arent seeing that generally...yet. Lets all remember that Sydney had amazing growth over @ 5 years... someone who bought in 2012,13, 14 or even 15 could have 10-15% come off their values and still be streets ahead. I actually agree with @sash that there will be more reductions to come... but in the end who cares? If you have sufficient cash flow to afford P&I ... or if you are in a 20-30 year PPOR home, who cares ?

Borrowers being forced to pay down some debt and banks being forced to get P&I v IO balances back to @ 70/30 is a healthy thing for every investor in the longer term... it is what will prevent the whole show from blowing up.

 

...and like the sands through an hours glass...the Sydney market turns......

Softening market 'drags down number of auctions'

 

And the denials are every day of our PC lives.......cue the horrible music

 

Exactly @sash and @dabbler .... Even blind Freddy could see the Sydney market turning.... i just can't understand why the vast majority of people will not confront the brutal facts.

 

I try to keep away from Sydney now as that’s the only place I don’t look at the numbers realistically and without emotions but had my eye on an apartment in Bellevue Hill. Received an email from the agent today about the price adjustment and the owner seriously considering offers in the 800s.
The last apartment sold in the (small) complex was almost identical, went for $1.16m in July 17.

 

Bellevue Hill is down the hill from me, $800s must be a 1brm or very small 2 bedder?

 

Definitely seeing a slowdowm, am very thankful we were able to sell my father's house (& for the price we got) ... we only had one really interested party (apart from the group who were dreaming of $500K less!)

 

There must be quite few blind Freddies on this site mate....

 

Where abouts and what sort of reduction to property did you gove to sell

 

Yes, just a one bedroom one.
I understand that there can be many reasons for the price difference but I thought it was interesting.

 

In BH? I am coming with all my money ...

 

Eastwood NSW - sold for $1.99 in October, which was in the range of the 4 agents that we saw in June - then were told $1.9-2.2. Had 3 builders at $1.9m.

 

Go for it, happy to send you the details if you like

 

in 2010 when the Perth market officially turned the state government initiated an equity share scheme (gov pays 30% of the mortgage for FHBs). As expensive places came down in price cheap places kept nudging upwards until 2015 when the entire market plummeted.

Last week vic gov announced a similar scheme: HomesVic

Does that mean we have 5 years left until an official correction is announced?

 

So government owns up to 25% of the property? Will they pay 25% of the rates insurance and maintenance costs? Seems a good deal for the government if prices were to continue to grow.

 

The program is called the Shared Home Ownership initiative and is not for FHBs but rather is for anyone who is eligible for a Keystart loan. Keystart was formed to assist those West Australians who are not readily able to obtain finance through one of the traditional lenders to buy a home of their own. The SharedStart loan has been introduced to support the State Government’s Affordable Housing Strategy: Opening Doors to Affordable Housing and the Shared Home Ownership initiative. Keystart will provide the loan for a purchasers share of the property

Basically, a purchaser gets a Keystart loan and buys a minimum of 70% of an eligible property, with the State Government buying the remaining percentage. The purchaser can then live in the home and later buy out the State Government at market rates or sell the property, with the sale proceeds being split between the owner and the State Government in accordance with ownership percentage.

Good point on the rates etc but unfortunately, no.

"You will however, be required to pay all rates, insurance and maintenance on the property, as Housing does not contribute towards these costs."​

That's a bummer. It is a good initiative for people who want to get into home ownership though.

http://www.openingdoorswa.com.au/MediaLibrary/Documents/shared-home-ownership-faq.pdf