4.3 years to save a deposit for Perth Homes

When you take the average income of a 25-34 year old and the median house price in the region, you come up with a calculation about how long it would take someone to save up a deposit on a home. Its not an exact science but a Bankwest research paper released today found that it would take a West Australian couple 4.3 years to save up for a deposit on a home. For the average single West Australian, it would take 6.5 years to save up for a unit deposit.

Fancy a house in Peppermint Grove? That will take a couple over 40 years to save for the deposit, assuming that they put aside 20% of their income to save for a deposit. This is the most expensive place in Australia to start a new house together.

The national average for a couple  is 3.7 years. Sydney was the most expensive city for a couple to save for a first deposit on a home, taking 5.2 years, with Melbourne requiring a slug of 4.7 years.

Most Expensive in the World

Monte Carlo: Not your first home buyer option

Some new figures coming out give us an indication of where are the most expensive places in the world to buy an apartment.

1. Monte Carlo $US47,578 per square metre. Why? Tax haven for the rich and famous but not enough land to go around. 

2. Moscow $US20,853 per square metre. Why? The communism pendulum has swung back the other way with a vengence on the back of high oil prices and economic growth. 

3. London $US20,756 per square metre. Why?  Everyone wants to be in the capital of the British Empire.

4. Tokyo $US17,998 per square metre. Why? Once again, the capitalism capital of Japan with not much land and too much business. 

5. Hong Kong $US16,125 per square metre. Why? Have you seen the size of this place? China's gateway to the Western world is a mix of ex-pats and new Chinese millionaires.

Here's the list thanks to the GlobalPropertyGuide.com 

MOST EXPENSIVE PROPERTY MARKETS (based on a 120 sq. m. apartment )
	COUNTRY	CITRY/REGION	AVE PRICE (US$/sq.m.)
1	Monaco	Monte Carlo	47,578
2	Russia	Moscow	20,853
3	UK	London	20,756
4	Japan	Tokyo	17,998
5	Hong Kong	Hong Kong	16,125
6	USA	New York	14,898
7	France	Paris	12,122
8	Singapore	Singapore	9,701
9	Italy	Rome	9,166
10	India	Mumbai	9,163
28	Australia	Sydney	4,994

Only Sydney made is as the only Australian representative. No Perth in the top 112 :)

Are you a first home owner looking for a home in Perth?

If you are looking for a house in Perth, please leave a comment here and follow this blog in the next few months as the hunt for a home gets serious. With the first homeowner's grant being reduced later this year, its crunch time for us and it pays to learn from each other. We are not competitors, unless you decide to announce in your comments the house that you really set your heart on. Until then, let's share information.. tips.. and warnings :)

Who was to be a millionaire.. suburb

Seven suburbs have been demoted from the millionaires list, their median prices dropping below the A-class threshold. For the year to February 2009, WA recorded four of the largest falls in median house prices with homes in Ardross losing over 26 per cent of their value to record a price of $772,500, down from $1.05 million. South Fremantle went down 24.8 per cent to a median price of $797,500, Cottesloe lost 23.5 per cent to $785,000 and home values in Rossmoyne dropped 20.6 per cent to $815,000. 

Median house prices in Shelley lost 18.9 per cent to $835,000, Sorrento suffered a 17.9 per cent fall to $870,000 and Shenton Park fell 11.2 per cent to $945,500 as normality starts to sink in with some of the boom time suburbs in Perth. 

Federal Budget Impact on Housing - Comsec

So what did the experts get out of the Federal Budget and its impact on housing industry? The following is a brief analysis undertaken by Commonwealth Bank. You can read the rest of it here

Where to for housing?

• The latest data on housing lending was highly encouraging, although substantially driven by the upgraded First Home Owners grant. The number of loans to owner-occupiers hit 13-month highs in March while loans to build

new homes hit seven-year highs.

• Not only are home loans rising, but building approvals have risen solidly for the past two months and home prices are also edging higher. In most parts of the globe, housing markets are becalmed with home prices down 10-20

per cent on a year ago.

• First homebuyers have driven the housing recovery and they will continue to be a driving force until at least the end of the year.

• For builders, tradesmen and building material suppliers, the extension to the first homebuyers grant is clearly good news. The problem for the first home buyers is that the additional demand for established dwellings will

continue to put upward pressure on prices.

• A key reason why the grant is in place for established dwellings is to support home prices. In other countries home prices are slumping. But in Australia, prices have been largely flat, but are now starting to edge higher

again. The stability of house prices is important in supporting consumer wealth, confidence and spending.

• Surprisingly Federal Treasury expects dwelling investment to fall by 2.5 per cent in the current financial year with no change in activity in 2009/10. A strong 11.5 per cent lift in dwelling investment is expected in 2010/11.

More time granted to first home buyers

Yesterday, the treasurer has announced in the Federal Budget that 

- Until 30 September 2009, first home owners will get the existing $21,000 for new homes and $14,000 for existing homes. 

- Between 30 September 2009 and 31 December 2009, first home owners will get $14,000 for new homes and  $10,500 for existing homes.

- After 31 December 2009, first home owners will continue to get the reduced amount of $7,000 for new or existing homes. 

The idea would be to slowly remove the first home owner "boost" without shocking the system.

Still deciding...

Its been quite a few months since this blog has been started. I am still not personally satisfied that the time is right to go into the real estate market. As mentioned earlier, I am a Generation Y, yes, the generation that has it all. We as a generation are starting to worry about the future. For the first time the word uncertainty has crept into our vocab and the strange feeling is still taking a while to get used to. 

My personal feeling is to wait after June, see how the market responds to the first home owner grant being reduced or removed. It should cool the market right down and maybe lead to a (amatuer prediction imminent) 50k drop in house prices in Perth. That's just a gut feeling anyway. 

Meanwhile many of the househunters have come across this site by looking for crime rates in Perth suburbs. That is a major factor because your home is your castle. People jumping over your fence reduces the "ownership" of your house. And our generation doesn't like sharing (unless its movies or music over the internet). 

In terms of my injection to the Perth housing economy, I'm still holding tight. 

Perth House Prices Drop 10% in past year

Australian Bureau of Statistics has released new house price figures that show a 3.6% drop in the value of houses in Perth for the January to March 2009 quarter and a drop of 10.1% over the past year. Around the country, the drop in house price was an average of 6.9%.

Sydney -2.9% -7.3%
Melbourne -2.3% -6.7%
Brisbane -1.1% -6.3%
Adelaide -0.8% -1.9%
Perth -3.6% -10.1%
Hobart 0.1% 0.6%
Darwin 2.2% 10.8%
Canberra 0.5% -5.1%

With the possibility of the first home owner grants being removed, there is a chance that this trend will reverse only in the next quarter and house prices freefall after June.