Home Builders In Wa

[Denver]

WA does follow the trends of the East to a point - but there are so many other factors that come into play in the East that don't affect WA pricing.

Take Sydney for example. Most of it's industry is based on finance and services, which follows the money market quite closely. This makes the highs very high, but also makes the lows very low and overall makes it a very sensitive market due to it's international connections. Note - this is only one facet of the Sydney market - I'm not saying this is ALL it depends on. Another factor it is also a very sought after place to live by both Australians and Ex-pats alike, but when the ex-pats leave, demand falls a little, which also affects prices.

Perth doesn't follow the east identically no, but on a whole, the country follows each side, sydney and melbourne are two different markets, and both have crash, as has QLD, its only really a matter of time for it to happen in perth..

As for the recession comment - what are you basing this on? Our exports are strong as is our currency and interest rates are steady. I see no problems on the horizon that could cause interest rates to jump 10% and our currency to be worthless. Can you?

Im basing it on that this is the same style of climate the country was in when we had the last recession in the early 90's, stuff like the oil price being incredibly high, large amounts of companies laying off large groups of workers to cut costs, the australian dollar hit incredible lows last year, its since recovered but its not as high as it has been, and stuff like the oil price being so high will all have a bearing on this, its just like it was some 20 years ago before the recession of 91..

I don't think associated purchasing costs would prohibit most people from changing houses and I don't believe the situation you mentioned above actually exists.

To give you an idea on purchasing costs - they should be no more than approimately 5% of the purchase price. If I was currently looking at housing around 400k, I would allow 25k purchasing costs. Given the current market and based on that I would be buying in a high growth area (or even better, one that is about to see high growth! ) the purchasing costs would be easily eaten up within the 1st year by an increase in capital.

I think what may generate the situation you've mentioned - people not changing housing - is either no change in income, so they can't afford that new 600k house loan, being happy where they are or fear of what the market may do.

This came from several real estate agents that i spoke with, i dealt with them on a daily basis in my last job, and the issue they all spoke of was people not wanting to move due to the costs, its a real life situation, people don't want to move because they are loosing money hand over fist if they do so..

Once stuff like stamp duty is abolished, people will once again be eager to move, if housing prices where at the same level they where 18 months 2 yrs ago, people would be moving without a worry because the associated costs would be a lot less, but witht he over inflated prices that housing is at the moment, forget it..

I disagree entirely. Perth is a desirable place to live and is growing faster than it ever has. Current mining booms feed some of the growth, but there are many other factors as well. City size and average house price compared to other Australian centers is one of many I can think of. Take a look at any of the big houses in Cottesloe. You could get into the most sought after beach suburb in Perth for around 1.5~2M. Try doing that in Sydney and Melbourne and you'd be paying at least 10 times that amount.

If people can't afford to buy, they'll have to rent, won't they? And who do they rent from? Property investors!

More people who can't afford housing will just push up the rental rates, making it more profitable to invest in property, generating demand for property by investors and keeping capital growth at sustainable levels. Agreed, not as high as some rates we have seen in the past, but it will even out eventually.

All these arguments aside - figures don't lie. Take a look at the average capital gain rate across Perth since 1950. It's 8~9% depending on sources.

Now look at the average interest rates across Australia for the same time period. It's 6~7% depending on sources.

Now join the dots. Property as a commodity can be insured against and will never completely dissapear. I know of many shares and managed funds that have done exactly that. So which one sounds safe eh?

Perth is a highly desirable place to live i agree.. however, We're on the other side of the country, the next clostest main city is adelaide, which is a 4-5 hour flight, or a 2-3 day drive away, where as all the other capitals you can be in the next main capital in less than a day, we're too far from anything, and this is why property is a lot cheaper than it is in the east, less people, less demand as such, but we also earn a lot less on a average per person..

The problem with all that is, while some people can afford to buy more than one property, and don't get me wrong, i think its a great investment, the issue lies in that if there is a greater demand for property, and less people can afford to buy, so they have to rent, yet everyone increases the cost of the rent, how are those people who struggle to afford to buy a house, going to be able to pay rent if it costs too much?..

this is where the bigger issues start happening, you get a lot more people unable to aforrd to rent, buy food, live, put kids through school etc etc, the divide between the well to do and the poor gets bigger and bigger, im all for people doing well for themselves, but when it adversely affects an entire city, something has to break, property values will have to go down...

Property is a safe option, but lets face it, if average people can't afford to buy it, how will the market grow, its the 9-5 family types who generate the big housing expansions, but when it starts to cost to much, things come to screaming halt, which im fairly certain will happen within the next 2 years..

[N I B]

Whats a worry is their setting up a short course for new builders,Zero to home builder in a matter of weeks?The standard of building is shocking now imagine whats to come?

[AlphA]

Im building at the moment.

Yeah buy if you like but I like the idea of the house having all the things I want and being able to customize it.

+ My wait is only 5 - 6 month then it will be finished. ( All the other houses in our estate have taken 5 - 6 months MAX )

People complain about the wait but 99% of the time its titles on land etc that is keeping them waiting *Or western power etc etc..

Dont take anyone advice as the final word.

It also comes down to what house you want. They all offer different houses and different degrees of custom changes.

[AlphA]

Property is a safe option, but lets face it, if average people can't afford to buy it, how will the market grow, its the 9-5 family types who generate the big housing expansions, but when it starts to cost to much, things come to screaming halt, which im fairly certain will happen within the next 2 years..

This is nothing new.. Ive been expecting it to happen for a bit now.

The thing people dont realise is that its not the end of the world at all!

This has happened in the past and it will happen again. Its just the way it goes.

I wouldnt let it put you off building a house however...

[PRO-L20]

Camin.. The reason why is undisclosed, and there is basically no other options available to keep it..

But even though our value has more than doubled, we cannot afford to buy another house, thats how bad it is.. Even Balga houses are selling for mega bucks now.. What's that tell you ?

[GWP021]

Whats a worry is their setting up a short course for new builders,Zero to home builder in a matter of weeks?The standard of building is shocking now imagine whats to come?

and i can tell you us trades who actually work hard to produce quality product are major pissed about it we all work hard to try to give the industry a good name put on appretices train em properly then some chump who wants it up now does this *end rant*

[CruiseLiner]

the little home builders for cheaper homes, are always gonna be trouble, they employ shit trades and half of them the builders dont even know or use on a regular basis, more or less "blow ins" when the work gets busy. i am pretty fussy but i gotta say 99% of new homes i look through are disgusting quality. celebration homes is alright, my sister works for them, and they are the same company as dale alcock, new home buyers, and a few others.

best builders are the upmarket more expensive ones. they spend the extra on making it look decent, and add little touches so they dont look tacked together.

i work for beaumonde homes personally and i reckon they do build one of the best quality homes out of any builders in WA thats for sure, except maybe zorzi and a few other really pricey builders.

i think only a tradesman can really spot the dodgy workmanship, and normal people say oh that looks great when i can tell immediately its a disgusting job.

pretty similiar to the car workshop industry, plenty of cowboys to be aware of.

depends on the supervisor who is looking after your house too, they have different trades and so a scott park home in clarkson is built by totally different people than one in canning vale.

checkout the display homes and alot of them are shit quality too, and they use the better trades on the displays than customers homes so thats a clear sign to stay well way.

oh and the warning about staying away from domination homes is true, they build the biggest heap of rubbish house ive ever seen, and thats one of the display homes in stirling i looked at.

cheers

Brad

Edited March 25, 2006 by CruiseLiner

[_8OO5TED_]

well i think Ross North Homes will be building mine, Ross is a close family friend so hopefully all goes well

[shmiddy]

dale alcock is the only builder out there who instead of banging up houses and getting paid, is looking at taking one team from every trade and putting the sub contractors on wages to work directly for him, "apprentice training teams" and he is supplying them with 2 apprentices a year then another 2 the next and so on, he even has a full time apprentice manager. worked for alot of builders and dale is the only builder we have worked for were quality comes before "hurry up and get this house finished" .. he has quality control manages, construction manages, all sorts the amount of people he has working behind the scene to ensure quality and that customers are happy is unbelivable, best builder in australia...

i think it depends, alot of trades are good trades but when some tradies get told "i dont care if the walls are out, its gonna rain tomoro and we need these walls rended so dont worry, just wack it on" so the house supervisors can sometimes be pushy, i think if they finish it before the agreed hand over date they also get a slight bonus, i think dont hold me to that"

[caminperth]

Camin.. The reason why is undisclosed, and there is basically no other options available to keep it..

But even though our value has more than doubled, we cannot afford to buy another house, thats how bad it is.. Even Balga houses are selling for mega bucks now.. What's that tell you ?

That's a shame man. Not a good thing to happen to anyone. I hope you can get something worked out.

Balga houses are selling around 280-340k last time I looked. I'm kicking myself I didn't buy one to develop 18 months ago as I the one I nearly bought was 180k.

It tells me the price ripple is moving outwards, as it always does. You just gotta work out where it's going to hit next.

[caminperth]

Property is a safe option

Agreed..

but lets face it, if average people can't afford to buy it, how will the market grow, its the 9-5 family types who generate the big housing expansions, but when it starts to cost to much, things come to screaming halt, which im fairly certain will happen within the next 2 years..

This is where we majorly disagree. The market probably will have a correction, yes - but a major drop? No.

Why? Beacuse people always need a place to live. They can own it or rent it - either way someone's bought it.

[N I B]

Did anyone see Sat west australian,they say WAs Median home price will be over 1 mill within 15 years. How are young ppl going to cope with that?

[Denver]

Did anyone see Sat west australian,they say WAs Median home price will be over 1 mill within 15 years. How are young ppl going to cope with that?

About the same as they do now..

they can't..

Im gunna wait till im in my early 30's before i buy, no point doing it now as im still not on what i consider a good enough income to cover it, id like to be around the 100k mark before i look at buying a place..

[N I B]

My first house cost me 28k furnished,Those days are gone.1984

[_8OO5TED_]

the expected rise in Perths population is like 140,000 in the next 5yrs, and its a fact that there is another area to develop to house all the people so, as long as the trades can keep up, the boom should continue. it will become more expensive to build but values will continue to soar with it.

Now is still an excellent time to build/buy in WA.

[StuiE]

Interesting.

I am 21 at the moment, but would like to have a house by 23-24 and at the moment its really putting me off because of the rapid price rises. I am just hoping the market does crash when everyone realises its too expensive to buy let alone build, so people start living at home longer or renting. I guess hoping for a house at a certain age is not the way too look at it, just jump in when the prices are at a low.

I'm pretty much in the same boat as you, I'm hoping the prices do drop, as Denver says. I am an 2nd yr apprentice earning shit money, and buying a house won't be a reality till I'm fully qualified (or hopefully earlier). Knowing that I can't do anything right now really sucks, watching the prices rise every day... if prices stay as they are now, my g/f and I should be ok when we go to buy, if they drop (and interest rates don't rise) then we will be even better, BUT if they rise, at the rate they are, then we can't save for a deposit as quick as the prices are going up, + repayments would be more. And then there's the fact your paying 300+ for a POS, wouldn't really feel all that satisfying...

So I hope Denver's senario works out, prices drop, not the _8OO5TED_/caminperth senario, I havn't really got a clue what will happen, I just have a feeling they will just keep on rising forever though...(hopefully at least slows down soon)

did any of that make sense?

[caminperth]

Stuie - it's a shame that younger guys like yourself are in that position, but it ain't going to get any cheaper. It's like hoping that petrol will come down to under $1/L again - it just ain't going to happen.

If you really really want to get a house, you can pay less than 300k. You just have to be prepared to accept something that is a bit further out, in a less desirable area or a bit smaller than you were really after. I think we're quite spoilt in WA with the price of housing and the proximity of houses to workplaces.

Imagine how it would be if you were living in Sydney or Melbourne. You might be earning an extra 5-10k per year, but the houses would cost twice as much and you'd have to commute 2hrs each way to work.

Try checking out a unit, townhouse or apartment instead of a house. At least that way you'd own something that is increasing in price along with everything else.

Do the sums on it, see finacial advisers and mortgage agents and if you really want to do it, get into it.

[caminperth]

Did anyone see Sat west australian,they say WAs Median home price will be over 1 mill within 15 years. How are young ppl going to cope with that?

I didn't read that article Steve, but it sounds like typical irresponsible scaremongering by the Sunday Times.

They'd probably calculated it using the highest possible growth that Perth has seen and carried that on for 15 years - which just isn't true. If you base it on the average capital growth rate of property for the last 15 years, you'd get the following..

Year Value

2006 300 7.5% average growth rate

2007 323

2008 347

2009 373

2010 401

2011 431

2012 463

2013 498

2014 535

2015 575

2016 618

2017 665

2018 715

2019 768

2020 826

While still sounding high at around 800k, think about what other things might cost by that time. Petrol seems to be something that everyone here can relate to and if that grows by the same rate, which is definitely feasible given the price rises seen over the last 20 yrs, then that would grow from around $1.20/L to somewhere close to $3.30/L.

Also it's a median, not an average. There's a big difference between the two measurements!

Everything will be more expensive by 2020. Anyone who thinks differently has got they're head in the sand saying to themselves "I remember when a can of coke was 20 cents", BUT it doesn't mean that things will be completely unaffordable.

[AlphA]

About the same as they do now..

they can't..

Im gunna wait till im in my early 30's before i buy, no point doing it now as im still not on what i consider a good enough income to cover it, id like to be around the 100k mark before i look at buying a place..

True dude.. But if you don't jump in now then you might miss the boat!

Im building a house for $150k and I got my land for $99k. This was 4 months ago now.. My land is now worth $149k and the house has gone up $20k.

Its a crazy ride thats for sure but you better get in quick or its going to start getting crazy.

[_8OO5TED_]

Where did you buy land for $99,000? South of ther River along the freeway I guess?

My block has jumped from $161,000 purchase price to $220,000 value in just 6mths also, so happy days