The salary you need to buy a home

How do your calc's go with the Sydney one? I don't earn too much less than the salary quoted but I couldnt see myself affording a $900k house at 80% loan p and I.

 

Out of curiosity if this was roughly 10 years ago, with the same scenario above. What would the max borrowing be?

 

Max borrowing capacity as a single with no other debts or income on Sydney medium salary of 106k is circa 570k so max purchase price with 20% deposit would be 710k.

 

Depends what the medium wage was 10 years ago?

 

Sounds nice
Did I rubbish Elizabeth the other day

 

Does everyone here realise that in the USA you can claim a tax deduction for interest paid on your own home?

That is a significant difference compared to Australia & something worth considering for such a comparison.....

BTW I've lived near Baltimore & its not all bad like some would "believe"....

 

Just make sure you have a gun when doing a property viewing in Detroit that is, that is not a joke

 

Yes
I don't Know too many people who invest or know a great deal about US markets

Loving US markets at the moment, inventory down to 3 months which means not enough stock

 

No doubt there are nice parts in Baltimore, but I was specifically referring to the cheap parts of Baltimore where you can pick up 3 bedroom houses for sub 100k.
In the photo MTR posted the 'salary required' for Baltimore was actually $56,837 so I guess that's the salary required to purchase a house in the non-ghetto livable parts?

 

To me its more the 'attributes' you need to buy a home. I would put it in this order:

1. Right attitude/expectations
2. Plan
3. Discipline
4. Income/savings
5. Take action.

There are many people I know who have been wanting to buy a place for many years and are still renting. All they have on the list above is income and either some or literally no savings. Then when I look at the people who have bought and are buying places now, most of them have all 5. In my opinion it requires a change in a person, sometimes a significant one, in order to have all 5 above. The alternative is to wait for property prices to drop massively in areas of very high demand.

You may be waiting a lifetime and then assuming they do fall 50%, will you then be ready to buy? Somehow I think 1,2,3 and 5 will still be a huge issue.

Just my opinion.

 

If the wage was the same at 66.5k 10 years ago when lending was loose

 

Exactly

 

Is the median salary in Sydney 106k? I thought it was lower?

 

It would be the same assuming debt was "buffered" at between 7-8%.

Lending policy was different so you could have bought some IPs as well.

 

Based on the infograph it is 106k.

 

Ditto for Perth.

I earn a lot more than the income listed with a mortgage that is less than 80%LVR of the median house price. Fairly sure as it was on the single income the bank wouldn't lend me a sausage over what they gave me (and that included FHOG and no stamp duty or LMI).

 

I think one of the big differences in the USA is the cost of housing relative to salary. Check out the cost of houses in the area I'm from: Keene Real Estate - Keene NH Homes For Sale | Zillow

 

Many Aussies don't really appreciate this & when the compound affect of own home tax deductions are taken into consideration, any straight comparison between markets (US/Aus) is significantly skewed.

Hence comparing median income / house prices between the 2 countries isn't really appropriate. That's my whole point....

 

If we're talking about first time buyers getting on the ladder, wouldn't the first quartile price be a more appropriate test than the median? Someone has to buy the below-median properties and it's not fair to expect investors to buy them all

 

Is it hard/easy to buy american property? Or perhaps you have american citizenship?