The majority of adults today can remember the last time it was difficult for people to find jobs, especially those who are young with no experience or qualifications. Such a time is upon us once more, even in the great country of Australia. It should be explained to individuals under twenty-five how to grasp the concept that the world does not owe them a guaranteed career earning at least $70,000 as soon as they get out of school.
Why Invest?
When it comes to surviving the recession, there are several ideas that are passed around such as eat at home more than going out, avoid buying designer things and even buy property now. It seems that now is a good time to invest in property in Australia. Here are a couple of facts about the current property market in Australia:
• First home market is flourishing thanks to government grants.
• Upper and middle market is frozen
• There are not many people listing
Even though the auction clearance rates persistently rise, the total number of these sales has dropped considerably. The current clearance rate in Sydney is up over 60%, which is close to 20% higher than it was at 
this same time last year. However, the number of properties listed was only down just over 120, which is more than a hundred less than the previous year.
The Right Move?
It is true that the majority of first-time homebuyers are able to obtain at least $21,000 worth of government grants, which in regions like Victoria will contribute, at least in part, to paying the government’s sales tax.
Sadly, young couples seem convinced that if they purchase a new four-bedroom home for $400,000 from the CBD, that they are making a solid investment. However, there are a few problems to be aware of such as:
• $400,000 is not that great of a deal, even if you only pay $280,000 for it.
• Even if you have two children, you will not need a four-bedroom home until they are almost grown. Do not waste money on interest that you should pay for another ten to fifteen years.
• Young couples are not interested in living in the middle of nowhere.
• Even shiny new houses require maintenance at one time or another.
• This is not the real market; instead, the government continues to subsidize the boom in the first-home buyers market. Therefore, you cannot sell until June 30.
Property Options Australia
Property Options Blog © 2006 – 2009
Hi Sean,
The government grant has been a big boost to first home buyers and done it’s job in boosting the economy. I just think that you need to crunch the numbers to see which property makes the most financial sense to buy.
You need to consider your goals and what kind of housing you’ll need in the future. But, it’s all in the numbers for me.
Great point with not needing a big house when you only have small children…you can always upsize later. The real estate market in Australia is a great place to invest and where the majority of Australian’s grow their wealth through capital growth.
Just so you know there are 2 typos in this article. One in the first sentance and one in the last.