Latest news with #REAGroup
Daily Telegraph
12 hours ago
- Business
- Daily Telegraph
Home prices adjusted to inflation expose huge baby boomer wealth
Hopeful Sydney homebuyers are paying substantially more money for properties relative to the cost of everything else than any recent generation before them, alarming new analysis has revealed – rubbishing claims baby boomers had it harder because of higher interest rates. The exclusive PropTrack study showed current prices were four times higher than in 1980 once adjusted for inflation, with a typical house back then costing $65,000, the same as $338,000 in today's money. It's a far sight from the $1.47 million Sydney houses are typically selling for in 2025. The research measured housing costs across each decade, showing property prices over the 1990s, 2000s and 2010s were also markedly cheaper than today when compared to other living costs at the time. Sydney's $187,000 median house price in 1990 was equivalent to $447,300 in today's money, while the $285,000 median in 2000 was worth $544,000 in 2025 dollars. MORE: 40yo 'disappointed' he only has 300 homes Even buyers who snapped up homes in 2010 paid significantly less than today in real terms. The average house back then cost $600,000, which would translate to about $874,300 once adjusted for inflation. SEE WHAT HOMES REALLY USED TO COST IN YOUR SUBURB REA Group economist Eleanor Creagh said the incredible differences in the real cost of housing over the decades showed current first-home buyers faced challenges like no generation before them. 'To boil down the challenges for first-home buyers to overspending on travel or smashed avocado is narrow and simplistic,' she said. 'Every generation has its own unique struggles but on the whole today's buyers are navigating a fundamentally different landscape with structural housing barriers baby boomers did not have. 'The deposit and stamp duty burden is much higher, affordability is more stretched and prices have vastly outpaced wage growth.' Ms Creagh said home prices in 2025 were significantly more expensive than the real costs of housing in the 1980s, 1990s and 2000s because of sweeping cultural, social and economic changes. These included the rise of dual income families as the predominant class of buyers and an interrupted run of economic growth between 1991 and 2020 that saw Australia stave off a recession. Markedly lower interest rates than in the 1980s and 1990s, and the resulting boost in spending power this gave buyers, was another factor that drove up prices, Ms Creagh said. Building costs have also risen. 'There are a lot of factors,' she said. 'The Australian population has grown by about 10 million since the 1980s and most of that growth has been concentrated in city markets where the supply of new housing has been constrained. 'There's also been a cultural shift. Property is a much more popular vehicle for wealth creation and when you combine that with economic deregulation and tax incentives, it's helped push prices up.' PropTrack economist Angus Moore said the lower prices paid by previous generations, even once adjusted for inflation, indicated younger people had a harder entry into the housing market. 'The deposit hurdle is just unequivocally harder than it was four or five decades ago, and that has manifested in home ownership rates which have fallen over those years,' Mr Moore said. Young people were taking longer to enter the market, relying more on family support to stump up a deposit, or making use of government incentives to buy with a smaller deposit, Mr Moore said. McGrath Hunters Hill agent Antonios Kanis said decades of price gains, while being an incredible wealth creator for owners, have come with a downside. 'Some homeowners want to move but can't because if they sold they wouldn't be able to get back into their own area. There's always a shortage of stock and that keeps prices high,' Mr Kanis said. Among the homeowners in this position are Wareemba residents Georgia and Malcolm Clark: they wanted to upsize from their current duplex to a house in the area but prices have exploded in the eight years since they bought. 'We love it here, it's got such a great community, but we've become priced out,' Ms Clark said, adding that they were now selling up their home at 345 Great North Rd and planning to relocate to a cheaper area. 'Those recent rate cuts will help with borrowing power but we also think it might heat up prices. We just hope that because we are buying and selling in the same market it will balance out.'
News.com.au
18 hours ago
- Business
- News.com.au
Home prices adjusted to inflation expose huge baby boomer wealth
Hopeful Sydney homebuyers are paying substantially more money for properties relative to the cost of everything else than any recent generation before them, alarming new analysis has revealed – rubbishing claims baby boomers had it harder because of higher interest rates. The exclusive PropTrack study showed current prices were four times higher than in 1980 once adjusted for inflation, with a typical house back then costing $65,000, the same as $338,000 in today's money. It's a far sight from the $1.47 million Sydney houses are typically selling for in 2025. The research measured housing costs across each decade, showing property prices over the 1990s, 2000s and 2010s were also markedly cheaper than today when compared to other living costs at the time. Sydney's $187,000 median house price in 1990 was equivalent to $447,300 in today's money, while the $285,000 median in 2000 was worth $544,000 in 2025 dollars. Even buyers who snapped up homes in 2010 paid significantly less than today in real terms. The average house back then cost $600,000, which would translate to about $874,300 once adjusted for inflation. REA Group economist Eleanor Creagh said the incredible differences in the real cost of housing over the decades showed current first-home buyers faced challenges like no generation before them. 'To boil down the challenges for first-home buyers to overspending on travel or smashed avocado is narrow and simplistic,' she said. 'Every generation has its own unique struggles but on the whole today's buyers are navigating a fundamentally different landscape with structural housing barriers baby boomers did not have. 'The deposit and stamp duty burden is much higher, affordability is more stretched and prices have vastly outpaced wage growth.' Ms Creagh said home prices in 2025 were significantly more expensive than the real costs of housing in the 1980s, 1990s and 2000s because of sweeping cultural, social and economic changes. These included the rise of dual income families as the predominant class of buyers and an interrupted run of economic growth between 1991 and 2020 that saw Australia stave off a recession. Markedly lower interest rates than in the 1980s and 1990s, and the resulting boost in spending power this gave buyers, was another factor that drove up prices, Ms Creagh said. Building costs have also risen. 'There are a lot of factors,' she said. 'The Australian population has grown by about 10 million since the 1980s and most of that growth has been concentrated in city markets where the supply of new housing has been constrained. 'There's also been a cultural shift. Property is a much more popular vehicle for wealth creation and when you combine that with economic deregulation and tax incentives, it's helped push prices up.' PropTrack economist Angus Moore said the lower prices paid by previous generations, even once adjusted for inflation, indicated younger people had a harder entry into the housing market. 'The deposit hurdle is just unequivocally harder than it was four or five decades ago, and that has manifested in home ownership rates which have fallen over those years,' Mr Moore said. Young people were taking longer to enter the market, relying more on family support to stump up a deposit, or making use of government incentives to buy with a smaller deposit, Mr Moore said. McGrath Hunters Hill agent Antonios Kanis said decades of price gains, while being an incredible wealth creator for owners, have come with a downside. 'Some homeowners want to move but can't because if they sold they wouldn't be able to get back into their own area. There's always a shortage of stock and that keeps prices high,' Mr Kanis said. Among the homeowners in this position are Wareemba residents Georgia and Malcolm Clark: they wanted to upsize from their current duplex to a house in the area but prices have exploded in the eight years since they bought. 'We love it here, it's got such a great community, but we've become priced out,' Ms Clark said, adding that they were now selling up their home at 345 Great North Rd and planning to relocate to a cheaper area. 'Those recent rate cuts will help with borrowing power but we also think it might heat up prices. We just hope that because we are buying and selling in the same market it will balance out.'
Sky News AU
2 days ago
- Business
- Sky News AU
Labor needs to 'step up the pace' after housing approvals slump, REA Group senior economist Eleanor Creagh declares
Labor needs to 'step up the pace' to fulfil its ambitious housing target, an economist has warned as the rate of building approvals in Australia recently slumped. Dwelling approvals fell 5.7 per cent in April, according to the Australian Bureau of Statistics, coming in well below market expectations and causing concern as the nation continues to grapple with a housing shortage. While the approval trend has been positive over the past year and a half, the recent downturn is a thorn in the side of Labor's plan to deliver 1.2 million new homes by mid-2029. REA Group senior economist Eleanor Creagh urged for greater action to fulfill the major looming target. 'We're really not approving and then building enough new homes to meet pace with where demand currently is and also to meet the federal government target of a million new homes by 2029,' Ms Creagh said on Sky News' Business Now. 'So, we really need to step up the pace of: one, approvals—which is really the best-case scenario for what gets off the ground; two, building activity—which is hard, given continued labour shortages and higher prices, cost materials, etc.; and then, three, completions.' The overall decline in April was driven by lower apartment approvals, according to the ABS' head of construction statistics Daniel Rossi. 'A drop in apartment approvals drove a 19 per cent fall in private dwellings excluding houses,' Mr Rossi said. 'Meanwhile, private sector house approvals were up 3.1 per cent.' This followed a 14.4 per cent drop in March as apartment approval rates have sank compared to the start of the year. 'In original terms, 5,612 apartments were approved across March and April, compared with 8,625 approved across January and February,' the ABS said. Alongside its pledge to build 1.2 million homes, Labor has also committed $10 billion to build 100,000 homes over eight years for first time buyers. The Albanese government has also established the First Home Buyers Guarantee to allow first-time buyers to purchase a home with a five per cent deposit and without paying Lenders Mortgage Insurance. It follows the Reserve Bank of Australia delivering its second cash rate cut of 2025 last week, which is expected to further the turnaround in house price growth after slowing in 2024. Originally published as Labor needs to 'step up the pace' after housing approvals slump, REA Group senior economist Eleanor Creagh declares
News.com.au
2 days ago
- Business
- News.com.au
Building approvals fall 5.7 per cent in April
REA Group Senior Economist Eleanor Creagh has responded to the latest economic figures showing a 5.7 per cent decline in building approvals for April, a result that fell short of market expectations. "The monthly trend for building approvals is incredibly volatile,' Ms Creagh said. 'But we have seen that fall in the most recent data released from the Australian Bureau of Statistics today. "However, we are still seeing that over the past year, the general trend in terms of where approvals are tracking is positive and is moving in the right direction.'
ABC News
3 days ago
- Business
- ABC News
ACCC announces investigation into REA Group
The Australian Competition and Consumer Commission has announced it is in the early stages of an investigation into REA Group, the 33 billion-dollar operator of over concerns about competition in the real estate industry. The investigation comes as the News Corp-controlled real estate advertising service has told customers it would increase subscription prices for real estate agents by as much as 78 per cent from July 1. Guest: Tim McKibbin, chief executive of the Real Estate Institute of New South Wales Producer: Grace Stranger The REA Group released the following statement: "REA is committed to providing choice, value and flexibility to its customers and consumers, and remains focussed on delivering products and services that improve the property experience of buyers, sellers and renters. "REA is cooperating fully with the ACCC and is unable to comment further for confidentiality reasons."
