Thread: Breaking news, millenials find a way to drive down house prices.

In 1970 I bought my first house at Coogee, waterfront, for $14,000. I had to put down $5,000 deposit. I sold it 20 months later for $19,000 and then bought a 1950's double brick home right on top of the hill behind the RSL club for $27,000. This house had been sold for $19,000 less than two years before. At that time Sydney property prices were increasing at a rate that made it impossible for a young couple on average wages (say a clerk and a typist) to pay rent on a modest flat and save for a deposit on a block of land or a house. Their savings went backwards in comparison to house prices going up ,up, up.

Banks then wanted substantial deposits. My wife worked in the CBC bank and says it was normal then for a borrower to be asked for 20% and up deposit. sometimes as much as 33% for a higher risk loan. Recently banks have been lending on 5% deposit.

Edit-Then in 1975 we bought a house in Norman Park, Brisbane for $28,500. The bank wanted $8,000 deposit. They would not take into account my commission earnings, roughly 40% of my earnings, my fringe benefits of a full private use company car and fully paid home 'phone, or my wife's salary. We paid it off in 5 years.

The problem with Sydney house prices is that Sydney has restricted land area being hemmed in by mountains and water. If you don't want to or can't afford to pay $2,000,000 for a house in Randwick ($1,500,000 buys you a renovator's delight in Randwick) or Chatswood then the cheaper alternative is to go west and south 40 miles from the CBD to Penrith /Emu Plains, Camden, Campbelltown or further. You then spend your life commuting. Even at the suburbs of Mt. Druitt like Wilmott house prices have skyrocketed. Ten years ago these were welfare slums full of bogans and ferals. Now even at Willmott houses sell for $500,000

By the way, the Coogee waterfront house is now valued at $3,000,000+. Sigh!

Originally Posted by Mick_Marsh

It depends on where you want to buy.
Unfortunately, for me, the bank knocked back my application for a loan to buy a 2BR BV 15 minutes from work. I reckon I could have snapped it up for $150k.
The banks are tightening their lending. This is contributing to the problem. A few years back, they were very loose with their lending. That contributed to the problem too. A first home owners grant also contributes to the problem.

But, what is the solution?

I'm with Bank Australia... We live in a little 3 bedroom single bathroom house. And figured we might extend. I rang the bank last year, they got up my account .... He just took one look and said "no worries, you'll be approved easily, don't worry about it".

So I put in an application to refinance for an extension. The bank has now ****ed me aroudn for 4 months. I've given them a piece of my mind and told them to shove there loan where the sun don't shine. They have ****ed me off to the point where I'm ready to change banks (if only it weren't so much work). I've been with Bank Australia.... Oh, did I mention ... They are USELESS ASSHOLES for 20 years.

My first house loan. I'm about 22years old. Working for not much more than minimum wage, have a small deposit .... I am borrowing nearly 100% of the houses value ( $89,000 .... well it is 20 years ago).... 20minutes filling in forms ... Done. 8 years ago we shift onto acerage just out of town.... 20minute filling in forms .... done ( one average wage... borrowing close to 100% of the amount I can borrow).

Now, our house is worth about 1/2 million. My wage is probably double the medium australian wage. We want to borrow $230,000 against the house that is worth 1/2 million to extend a house that will be worth $650 -> $700,000 when extended.

FOUR ****ING MONTHS LATER. The ****ing bank is still ****ing me around. Never have I seen a person, they want to do everything remotely. I've ****ed the builder off to the point where he's basically told be to **** off and stop wasting his time .... Everytime were "almost" there, the bank decides that they need somethign else ... different builders insurance, different details somewhere... different versions of extension plans ... different bloody something (waiting several weeks each time be making another request).

Can you imagine how ****ED OFF I am. Do not dream of dealing with the ASSHOLES AT BANK AUSTRALIA. four ****ing months later ... and the builder has well and truly moved onto other jobs. and says he "might" be able to start next year now.

Basically the way I see it, the banks don't want to grant loans while the royal commission is going on.

seeya,
Shane L.