When you read articles about Australian housing affordability, it is often comparing the single average adult wage to house prices, from generations ago.
The articles generally say something like, ‘a house was worth three times the annual average wage back in the sixties and is now worth 10 times the average wage. This shows housing has become unaffordable.’
You can’t compare the two because back in the sixties it was one wage bidding on real estate.
In today’s Daily Reckoning Australia, Callum discusses the housing market, the big immigration development last week, and the stock he likes best for the next two years. Plus, four more ideas for you to buy now…
Earlier in the year, Queensland Treasurer Cameron Dick moved to close one of the loopholes many property investors used to dodge hefty land tax bills.
The US middle class stores its wealth in its houses. But now termites have gotten into the woodwork. In July, new house sales hit a six-year low. Existing house sales are down 20% from last year. And the median sales price has already dropped 5% since last year.
The rental market couldn’t be tighter. Properties available for rent are at an all-time low — and falling. SQM Research recorded a 4.5% drop in listings over the last four weeks.
ompany results are coming in thick and fast now. We’re in for a monster week. You might end up with the same conclusion as me: the Australian economy isn’t as bad as the mainstream press make it out to be.
Never forget — ultimately, all gains from innovation and technology find their way into land’s price through the cycle. The house (or rather land) always wins in the end.
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