'Expert warns Australia could turn into slums in 20 years' | 60 Minutes Australia
Housing and banking expert Martin North North has criticised developers and the housing industry for “throwing up” high-rise buildings at such alarmingly fast rates. He warned viewers that significant defects and safety concerns are imminent.
I've been saying exactly this for the past 8 years. However, it's not just about poorly built high-rise apartments, those are just the tip of the iceberg.
All over Sydney and in other capital cities, there has been a huge boom of so-called "master-planned communities". Basically developers have bought up vacant land, divided it up and built 100,000-odd homes. The blocks are tiny (some even as small as 300m2) and the houses are built so close together that you can touch your neighbours wall from your bathroom window. The streets are so narrow that you're barely able to drive two cars down them side-by-side and sometimes not even that. The houses themselves are built to a price (which is not passed onto the owner), thin walls, internal doors literally made out of cardboard, low quality fixtures and fittings but they boast "premium features" such as a "theatre room" (which unless implemented properly is just a second living area) and a "butlers pantry" (another waste of space). You can hear everything your neighbours do and traffic in/out of these suburbs is horrendous. They are honestly depressing places to live.
300m2 blocks are currently selling for around the $375k mark and you don't even get a house with it. Once you build the most basic house, you're probably looking at over $600k for the whole thing. If you ask me, a block/build like that
should be closer to $450k.
Interest rates are currently low. If you're paying 4.00% p.a. or more for an owner-occupied house, you're paying way too much. My rate at the moment is 3.69% p.a. and it's not even the cheapest product on the market. Even with record-low interest rates, families are mortgaged up to their eyeballs. A moderate rate increase and people can't afford to pay... you can see where this is headed...
Buying property is about making smart decisions purchasing in the right place. If you have absolutely no intention of ever selling, don't care about traffic and noise and are happy with that style of living, then sure, go nuts. But if you're looking at building a portfolio that's worth something in the future, these new "communities" are absolutely the wrong choice.
For $600k, you can find yourself some very decent buys in areas like the Hawkesbury (Windsor, Richmond, Bowen Mountain), the Blue Mountains or the North and North-West of Sydney.