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The Guardian
3 days ago
- Business
- The Guardian
‘It's a shock': if you think Adelaide housing is affordable, think again
When people think of Adelaide, they may ponder its good food and wine or its many churches. Historically, it was viewed as a well-priced place to live and work. But years of surging property prices have made it less affordable than some of the world's most famous cities, including London and New York, when income levels are factored into living costs. Even those with a front row seat to the change have trouble comprehending it. 'It is a shock for someone like myself, who was born and bred here and always thought of Adelaide as being one of the most affordable places to live with the quality of lifestyle that we have,' says David King, a property agent who assists buyers entering the market. 'The traditional first-time buyer is now being priced out of houses and that has led to a quite large increase in unit prices across Adelaide. Now even a unit is becoming out of reach.' King, a buyer's agent at property group Cohen Handler, says prospective buyers in Adelaide are frustrated. 'There are people who come to us often through a level of frustration that they've been out there looking and missing out on so many different properties. They are just sick and tired of being out there every weekend.' Adelaide is the sixth least affordable metropolitan market listed in the recent Demographia International Housing Affordability report, which measures housing costs to income in 95 markets across eight nations. The South Australian capital, which is less affordable than global cities such as San Francisco, Chicago and Toronto, is now Australia's second-least affordable city, after the perennially expensive Sydney. While Hong Kong is at the top of the list, it is suffering from a depressed housing market, in a trend that will probably soon give Sydney the unenviable title of world's most unaffordable city. Demographia blames a global affordability squeeze on governments using urban containment strategies, which it defines as a focus on densifying housing within city boundaries as opposed to expansion. Australia has also been gripped by concerns that state and federal government policies are fuelling demand through their policies, without adequately addressing supply. While housing affordability across the country deteriorated during the Covid pandemic, as wages fell behind rocketing home values, most of Australia's major cities have been expensive for decades. Some of the biggest price gains occurred in the late 1990s and early 2000s, with near double-digit annual percentage gains, backed by the 'increasingly significant role' of investors pumping up demand, as noted by Treasury at the time. This coincided with the Howard government's 1999 decision to reduce capital gains tax for investors. Home prices as a multiple of Australians' incomes have more than doubled since 1980, according to the OECD's measure. The same figure has only risen by half as much in the UK and barely moved in the US. Sign up for Guardian Australia's breaking news email Prof Hal Pawson, an expert in housing policy at UNSW, said that affordability has deteriorated faster in Australia than in most comparable countries as bigger tax exemptions allow investors and owner-occupiers to pour more money into the sector. 'Australia's a country that, probably to a greater extent than even other anglophone countries, has an obsession with property as a place to put your money,' Pawson says. Geography also plays a part. Australia's layout and remote centre mean people congregate towards big coastal cities, contrasting with the more common practice across Europe and the US of inland cities. Adelaide, now less affordable than the more heavily populated Melbourne, is a good example of a city being squeezed by its terrain, given that it is locked between the ocean and the hills. Recent coverage of Australia's housing crisis has focused on soaring demand and sluggish supply of new homes, with growing city populations held back by rising construction costs and lengthy project approval processes. But in Germany, which also faces those issues, incomes have grown faster than home prices over recent decades, making property more affordable. Housing enjoys fewer tax breaks in Germany, while rent caps and stronger protections for tenants mean much of the population is happy to rent long-term. Christian Danne, a Berlin-based economist, says price-income comparisons hardly apply because half the population isn't looking to buy a home. 'Ever since the 1950s, it's a renters' market,' he says. 'The most prized possession in the UK and Ireland is your house, but for a very long time in Germany, the most important status symbol was your car.' More than half the German population rented a home in 2024, whereas only about a third of Australians are tenants. Amid a shortage of housing stock, rents for new tenants have been rising fast in Germany, putting pressure on young people and migrants entering the market. But those already settled into a rental are usually spared the steep increases. 'Price increases are very predictable once you're living in a place, so there's literally no incentive to buy and own a place other than personal preference,' says Danne, a consultant at DIW Econ. Australia has seen bigger hikes in both existing and new rent costs in the last five years, with average rent prices up nearly 20% and the advertised price of new rentals up nearly 50%. Affordability advocates in Australia are focusing their attention on rental rights, which are a state issue. The thinking is that improving tenancy rights may lower the value of rental properties and depress rental prices, easing affordability at the expense of landlords, as it does in some overseas markets. Bruce Djite, the South Australian executive director at the Property Council of Australia, says Adelaide's past affordability advantage has been 'completely eroded' and policymakers aren't reacting by increasing supply fast enough. 'We are not acting like we're in a crisis [but] a lot more needs to be done,' Djite says. 'If we continue on like this, we will get a reputation for not just being unaffordable, but being completely inaccessible.'
News.com.au
5 days ago
- Business
- News.com.au
Secret tactics of dodgy agents exposed
Secret tactics used by unscrupulous agents to drive up home prices have been exposed by Aussie homebuyers who are now warning others how to spot it. As housing affordability falls to record lows across the country, home buyers and former agents have begun sharing tips for how to tackle agents who resort to deceptive tactics to force more money out of buyers – a major issue given surging prices now have many already bidding at their borrowing peak at auctions. The Australian property community exploded with advice and shared experiences after a Redditor asked 'post auction, am I being played' over a real estate agent continually coming back for more, claiming there was a second party gunning for a house. 'Went to an auction, there was just me and a buyers' agent bidding. Buyers agent's last bid was $1.4m, mine $1.45m. Property passed in. Went to negotiations, vendor wanted $1.56m. Bid against myself and offered $1.48m. No deal, walked away. Buyers' agent had left.' 'Phone call 3 hours later, buyers' agent had offered $1.50m. Asked if we would submit a better offer. Submitted $1.51m. Agent sent through contract for signature. Signed offer. Received a call the next day, buyers' agent has submitted a higher offer. Said they won't reveal offer, and want my best and final offer. I think I am being played.' Culture Kings founders' bold $30m push The feedback was fast and furious, with many urging the buyer to walk away or even drop their offer back to the original auction top market price. One user said 'the seller wanted the highest price the market would pay. That's why it went to auction and that was demonstrated – market price: $1.45m. After that the b*llshit started because they don't agree with the market price.' Several former real estate agents chimed in, one confirming the tactic, saying 'when I worked in real estate we would do this quite often and it was all legitimate, reason being to stop the back and forward especially post auction and to get a deal done (mostly at vendors request)'. Another said 'having been on the selling side, this is exactly what a 'good' selling agent does to squeeze every dollar out of you.' The ex-agent's suggestion was 'go back with a LOWER offer, as the owner is often desperate to sell. You have power with your offer'. Zac Efron's Aussie long lunch haunt is on the market Among the experiences shared was one saying 'house was up for $399k, my offer was in at 375k before the open home, they apparently got another offer and the agent kept giving me the FOMO treatment to get me to offer more, and said they had another offer. I said I will only go up to 380k, that's it. Still tried pressing me for more and I got annoyed and said 'if I lose it, I lose it'. Call came in next day and my offer was accepted by the owners'. Another said 'agent called for 2 days straight talking about another buyer and hubby said a number 40k over what we had offered and agent says yep $1000 more than that amount and it's yours. We said no, house sat for another 6 weeks and ended up going for 25k under our offer'. 'Same thing happened to us,' said another, 'property range around 1-1.25 mil, we offered 1.25 because we wanted a quick sale and ready to move in. Agent played around and said owner wanted more than 1.25 mil … We walked away … That property ended up selling for 1.105 mil. Sometimes agent and seller just have to learn to say yes to a good deal and not trying to push for an extra 5k or 10k'. Artist builds Aus first aircrete dome home Another said 'I told the agent that my final bid was x amount (the amount I'd already offered), and they could accept it by the end of the day, or I would pull out. By the end of the day I was signing contracts. So it turns out that there likely was no other party'. A last minute tactic was also exposed by another Redditor: 'we were all good to proceed with signing the contract, confirmed this with the agent … Then 10 minutes later the agent called, sounding all sad, saying that there had been another offer that had come in late that was substantially higher than ours and that he was legally obligated to present that offer to the seller etc etc. Pushed for us to offer more in response.' 'We told him to do what he had to do and left it at that. Another 15 minutes later the agent called again, sounding rather sheepish saying that the other buyer was not serious and that the house was ours … It really soured us on the agent who otherwise had seemed like a genuine (for an agent) straightshooter. He just carried on like that whole event never happened.' After the flood of advice, the original poster told the community 'this morning I sent off an email and have withdrawn our offer. So if they don't have the other offer, they have nothing. We are happy to walk. It's not our perfect place and if it does go, we are happy to let it go above our offer'. This was followed by an update: 'Got an email just then. Apparently the other buyer has pulled out. Hahahahahahahaha.' Among the tips from those suggesting buyers walk away was one Redditor saying 'make sure you rescind your offer in writing' while another said 'if passes in at an auction, give an offer, but say it is withdrawn in 3-4 hours if I don't see a signed contract. I have done it and been successful thrice. Agent typically wants to sell and move on'. Another said 'as a rule of thumb, don't make an offer before an auction, that's when they play you against an imaginary buyers' agent'. 'Typically if there are no other real buyers, they will advertise a firm price on the Monday (after the auction). If they put up a range, walk away. Ideally you want to close it before 6pm Sunday or walk away otherwise they Dutch auction your offer'.
News.com.au
26-05-2025
- Business
- News.com.au
Aussies shocked at price of Sydney home but agent has a simple message: ‘They don't know'
'Sydney prices are a joke.' That's the sentiment from Australians after a video went viral showing a period home in Sydney's eastern suburbs with an asking price of almost $7 million. The five-bedroom, three-bathroom Federation-style home on almost 700sq m in one of the city's most sought-after tree-lined streets needs a bit of work. Even the agent admits that. But many could not understand how it might fetch such a hefty price. '$7m for this? Australia is cooked,' one person wrote on a video shared by a Sydney buyers agent. '$7 million and the master bedroom doesn't even have an ensuite?,' another wrote. 'No understanding why anyone would price this house at $7 million,' wrote another. But the home at 29 Milroy Avenue in Kensington is worth more than that, according to Roger Wardy, the Director at Ray White Touma Taylor. He should know. He just broke the suburb record with a sale of a similar property — 6 Mooramie Avenue — one week ago that went for $7.5m. 'They don't know,' Mr Wardy told when asked about those questioning the price guide. 'They're uneducated about wealth or how to make money. First, they don't have that amount of money. When you know that area and the growth, you wouldn't think twice about that price.' In fact, Mr Wardy believes the home is worth more. With a few small tweaks, he believes it could be the first home in the suburb to attract offers in the $8m range. 'I see the value here. That's why I invest here. This spot here is on the tree-lined, flat section of the most sought-after street in the suburb. 'It has a huge amount of space, lush gardens, a massive pool, very high ceilings the whole way through. 'Properties like this are rare. It's not the most renovated, but not the most unrenovated. You don't need to spend that much to make another million — just a few cosmetic changes and it could get $8m.' Not bad for a home that sold in 1997 for just $695,000. Kensington is just south of Moore Park and west of Randwick, 4km south-east of the Sydney CBD and less than 10 minutes from Coogee Beach. It is booming. In the last four years, the median house price in Kensington has grown from $2.5m in 2020 to more than $4.2m in 2024. And Milroy Avenue is 'regarded as the best street in the suburb,' Mr Wardy says. 'It's five minutes from the city, 10 minutes from the best beaches, close to transport to the west and north. It's really conveniently located. 'The people who live here have top tier jobs; surgeons, solicitors, barristers, directors of banks, they live here. 'What I've noticed is people think they want to live near the water. But in two years, they get over it, they get sick of having drunks walk past their house. So they come back from water side to park side. They raise their families here instead.' Mr Wardy said Kensington is growing in such a way that it has passed the rate of growth for Vaucluse — one of Sydney's most affluent suburbs. 'If you had invested in Kensington 10 years ago and Vaucluse 10 years ago, the percentage growth on the dollar is more in Kensington. 'It's like a diamond in the rough.' The sale of 6 Mooramie Avenue, which broke a suburb record at the start of May, overtook another of Mr Wardy's sales. In September last year, he sold 7 Lenthall Street in Kensington, a corner block, for a whopping $7,250,000. The new suburb record at the time was sold after a single inspection. It bodes well for the upcoming sale at Milroy Avenue. Even if those on social media can't wrap their head around it just yet.
Yahoo
10-05-2025
- Business
- Yahoo
Tradie's incredible property transformation in just five weeks: '$80,000 profit'
When Sam Harper walked through the front door of his newest property flip project, he admitted feeling a little "scared". With broken windows, blackened ceilings and asbestos-infested walls, the home in one of Perth's up-and-coming eastern suburbs needed a complete gut. While most young Aussies around the country are grappling with how they'll get onto the property ladder, 27-year-old Sam is busy finishing off his fourth property renovation project in just two years. After five weeks and nearly $60,000 injected into the Koondoola home, the self-professed property flipper couldn't be more proud of what he and his team had done with the place. Sam, a former tradie from Victoria, told Yahoo, "like most young blokes", he wasn't sure what to do after finishing high school, so jumped straight into an electrician apprenticeship. But after nearly 10 years in the industry, he knew it was never something he was passionate about. "That quickly becomes a bit of a burden," he said. "I had the realisation if I don't go for something I actually want, I might get myself stuck doing something I don't want to be doing." After travelling the country with his partner, the pair settled down in Perth and bought their first home two years ago. He jumped into a course to become a buyer's agent with the hopes of learning the ropes of property investing, but in doing so quickly discovered "I'd trap myself with more debt in a job I didn't want to be in," he explained. That's when he started delving into the world of property flipping. "I knew it was a big thing in other countries, but not done as much in Australia," he said. Last January, Sam and his partner used their full-time salaries to buy a home to live in and renovate on the side. After nearly five months, Sam said the equity wasn't quite enough to start flipping more properties, so he used "private investor funds" to help get the first few property flips off the ground. 🐜 Aussie homeowners warned over property almost 'crumbling' as tradie makes alarming find 🏡 Photos show huge problem facing Australia's fastest growing city 🏚️ Major change for 800,000 Aussie homeowners facing 'stressful' issue Sam's most recent project in Koondoola, an eastern suburb of Perth, is his proudest achievement to date. He said he was "genuinely scared" to enter the property after purchasing it. He described the condition as "horrible". "It was a nice family home for years," he explained. But after several years of neglect, it was left looking a little worse for wear. The house required a complete gutting. "Kitchens ripped out and put back together, bathroom ripped out and put back together, there was asbestos in the kitchen and the bathroom so when we were demolishing we had to get it all done properly," he said. Wallpaper had to be removed, holes in the walls patched up, along with repainting, reflooring and "full landscaping". Sam and his team placed new grass and reticulation in the backyard, painted the outdoor "bunker" — a former wine cellar, and painted the patio. He estimates the entire cost of the project was about $60,000. The property, purchased in February of this year for $500,000 is now listed for $695,000 — with Sam estimating that his profit before tax will be around $80,000. Remarkably, it took just five weeks. "It's a pretty quick turnaround," he concedes. So what is Sam's secret to success? Buying properties no one else will touch. "The ones I've done have been in horrible condition," he said. "Otherwise it can be a challenge to pick them up. Though in saying that, there are opportunities everywhere." So far, he's done projects within a 30-minute radius of his home in areas that have a cheaper price point. "I'm mainly looking at fundamentals where there is heaps of opportunity to find deals," he said. While a background in the trades has definitely helped Sam, he thinks you learn more "when you get your hands dirty". "I've worked alongside many other trades which has given me an idea of how things happen, but there are plenty of people still doing this that don't have a trade background and are successful," he said. Incredibly, Sam was able to make property flipping his full-time gig through his business Harpers House Flipping after less than two years. "Only six months ago I was still wearing high vis doing something that I didn't love," he said. "It wasn't going to get me and my family where we wanted to go. I had no idea if it was going to work out but I didn't let fear get in the way. I trusted I was going to figure it out." His plan eventually is to build enough capital to buy properties to hold for the long term. While many young Aussies will tell you the property market is simply too hard to get into, Sam argues that a "mindset shift" needs to take place. "If you focus on the problem, that's all you'll see. "My mindset is always looking for opportunity," he said. "Anyone who achieves anything great in their life will have the mindset of 'I'll find a way', and they usually do." "At the start it was quite scary, but I want people to know that you don't have to be anything special to go out there and chase what you want to chase, and create a better life." Do you have a story tip? Email: newsroomau@ You can also follow us on Facebook, Instagram, TikTok, Twitter and YouTube.
