Melbourne property “so far out of whack”

By Leith van Onselen

If you get a spare 10 minutes today, make sure that you listen to the above interview with property developer/investor, Michael Drapac, from Tuesday’s Mornings With Jon Faine show.

Drapac is a prominent developer/investor that has been in business since the 1970s. In the mid-2000s, he held the biggest portfolio of CBD land in Melbourne (now sold-off). And now, he holds a multi-billion dollar land portfolio in South Eastern United States.

According to Drapac, Melbourne is home to one of the world’s biggest property bubble, and anyone that “believes this time is different is either naive, arrogant or dumb”.

Drapac goes on to explain how valuations are “so far away from historical norms and commercial norms that we’re in dangerous territory”, referencing among other things the extreme levels of household debt and the huge gap between prices and rents.

Drapac also blames the epic rise in valuations on various demand-side drivers, including tax policy (e.g. CGT discount and negative gearing), SMSFs gearing into property, foreign investors, the mining boom, and low interest rates (easy credit).

Drapac doesn’t know what will cause prices to correct back towards historical norms, but believes that it is inevitable. He expects that the catalyst will be some kind of “hidden punch” and that prices will probably “over correct to the downside”.

Again, I highly recommend that you listen to this interview.

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    • The moral majority is ready to respond to such flagrant outbursts. Larry Flint will be put in his place.

    • I don’t want to be antagonistic, but Australia does NOT have a global city.

      Sydney is not a London, Paris, New York or Tokyo.

      Sure, it has global city house prices, artificially created through misapplied incentives and on their last hurrah before the slow melt.

      (‘Bubble’ is a misnomer, peak to trough in a housing bubble takes anywhere from 3 to 10 years…witness Ireland, Spain, US…UK – EXCLUDING global city London)

      • I have a rueful chuckle every time I hear an Australian (it’s only ever an Australian) referring to Sydney as a global city in the top echelon.

        We’re not even in the top 10 in most objective rankings.

        Like you say, only “winners” in terms of property prices. In the minds of the deluded price = value. It’s so tragic.

      • Exactly. The idea that a city in Australia – a country that was described by a sitting Prime Minister as ‘the arse end ot the world’ is truly world class, and justifies New York or London style house prices is ridiculous.

      • @coming,

        Need to keep scrolling to the indices with actual rankings. Sydney is in the mid teens on all those in the link, except, amusingly, wealth, as measured by a Real Estate company

        For mine, the thing to aim for would be ‘competitiveness’, in which apparently Sydney and Melbourne are similarly second class, and on which list the cities above largely make sense, although there’s a few below that you’d expect to be higher.

      • “err, your own link shows us in the top 10…”

        Err, 14 for Sydney and 25 for Melbourne in the “Global Cities Index” at that link.

      • Sorry I only looked at the GaWC 2012 study. Sydney is alpha+: one of only ten cities to be considered so

  1. As a New Yorker who studies the property markets of Syd and Mel closely, I have to agree.

    I don’t believe Sydney is that crazy when compared to other major global cities. It offers pretty good value for US$1.5 million. This gets you a shitbox in NY and London.

    Melbourne on the other hand is ludicrous. Melbourne is not a global world class city. Yes it’s nice but it’s not a significant place. It has some standing but it’s a Chicago, not a New York.

    Melbourne is almost as expensive as Sydney! Why is Elwood the same price as Manly?!

    I’m convinced it comes from the insecurity of Melburnians. They always think they are better than Sydney. “Me too!” We can have property gains too! And so they think Melb property is worth the same as Sydney and bid up the price.


      • As a New South Welshman that moved to Melbourne I have to disagree based on my experience. I have lost count of how many times, upon hearing I moved from Sydney, Melbournians have eagerly asked me to compare cities, repeatedly asking which city is better. I got a sense of Napoleon Syndrome. Now I avoid mentioning it unless directly asked.
        Unfortunately UE, I don’t think you speak for all Melbournians

      • Funny, one of my best mates lived in Sydney for three years and was asked the same thing from Sydneysiders. We used to laugh about it.

        Personally, I’d rather live in Adelaide, but family ties me to Melbourne. But hey, I’m a one phonebook kind of guy.

      • @just_the_pip.

        Valued opinion having lived in both.

        I spend a lot of time in Melb and live in Sydney. I like both. They are the same.

      • Lived in Melbourne for 8 years, have now lived in Sydney for 3.

        I think Melbourne is a tremendously ugly city. Everyone has a tedious obsession with football. The weather is simply awful especially in summer too hot

        On the bright side, the educated/white collar people are generally friendlier in Melbourne, and the food is better.

        Each to their own but I prefer Sydney

        I definitely agree about Adelaide: its a prettier version of Melbourne, and houses are half the price.
        Less traffic too

      • There you have it UE, probably not much difference in the experience regardless of which way you cross the border….

        Agreed on Adelaide, I travel there a bit for work and its a usually a nice break from Melbourne. What you might sacrifice in amenity, culture etc is more than gained in affordability and absence of congestion, not to mention proximity to McLaren Vale

      • Sydney is not global or world-class. Not even close.

        It’s got a nice bridge, iconic venue, a botanic garden, a couple of ferries and some beaches (some not even nice) and that’s about it.

        Cannot compare to NY or London. At. All.

      • In my experience a lot of melbournians have a bit of a complex about this. As a pommie expat (so no bias as I’m not from either) it’s a pretty clear trade off: Melbourne is more practical, easier to live in and arguably a bit more cultured, sydney has a better climate and more natural beauty. I didn’t move here for the culture or for pragmatism, hence it’s sydney for me. But it depends what you value as an individual, hence the never ending debate.

      • “Cannot compare to NY or London. At. All.”

        Agreed. I’ve spent a fair amount of time in London, New York, Sydney and Melbourne (where I now live) and the idea that Sydney is comparable to London or New York is laughable.

      • lived in Sydney for 10 years…inner west, Glebe. loved it. Not so great when started a family though.

        moved to melbourne 3 years ago…st kilda east. Took a while to adapt but much prefer it here now.

        wouldn’t move back to syd even if you bought me a house on the harbour/beach.

        Sydney weather better only if you like humidity.

      • Being asked to “compare cities” happens everywhere in the world if you’re an expat. Its got nothing to do with Syd v Melb or insecurity of the person asking the question (or very little).

        People ask you to compare places because its an obvious conversational next step after learning that you come from a different place. There’s not much more to it than that.

      • “the idea that Sydney is comparable to London or New York is laughable”

        Bloody hell AB!!! For God’s sake don’t let the Sydneyites hear you say anything like that. They don’t even know there IS anywhere else!!!!!

      • AnonNL wrote:
        > Sydney is not global or world-class. Not even close

        Globalization and World Cities Research Network disagrees; Sydney is classified as an Alpha+ city along with cities like Hong Kong, Tokyo and Dubai, with only London and New York City being in a higher category (

      • Don’t mention the wiki sight to Perthians – they’ll be up in arms about only being mentioned once, and that was a Beta -. There is nowhere better you see, the eyes of the world are on Perth thanks to mining, and if you don’t like it – leave.

      • @ bendy wire
        Perths main claim to fame will be this – its where the bubble burst first. It may even be the prick

      • Can someone please tell me who this bloke “Sydney” is and why everyone keeps comparing a beautiful place like Melbourne to live in to some pretentious chap that Sydney clearly is!

    • pretty ignorant post… And that’s coming from a Sydney sider who’s been living in Melbourne for a few years now… Just like Sydney, Melbourne has plenty to offer and does many things much better than Sydney…

      • @Anon NL.

        V true Sydney is not a world class city: it’s too philistine, it lacks cultural life/industry, not just buildings or events, but it has no cultural infrastructure, most of which is based in Melbourne.

        Melbourne, on the other hand, is similar to Brussels.

      • @ Jake Gittes

        “Melbourne, on the other hand, is similar to Brussels.”

        LOL!! That would be at the ‘non-Paris’ end of the city I take it?

        Melbourne is a big country town where people still care what private school you went to, Eddie Mcguire is treated like royalty, and people queue up for hours for restaurants that wouldn’t even book out in Sydney. What a laugh.

        As for the Melbourne/Sydney rivalry, it’s a lot like the Chicago/New York rivalry….only spoken about in Chicago.

      • Your perspective is different because you’re an Aussie. I’m not.

        Melbourne people are just too insular and parochial. People who still hang out with their high school friends. Yuck. Sydney people are but not as much. They’re much less obnoxious and inward looking. They have softer accents. More outgoing and confident. There are more international expats around. They even look different! It’s come to the point where I can predict with 90% confidence whether an Aussie expat here in the States is from Melbourne or Sydney.

        Melbourne is the easier more practical place to live, don’t get me wrong (it’s not because of those ridiculous trams though). Just like Chicago is much easier to live than NY. There’s just a much more confident, optimistic outward-looking vibe in Sydney. I was always slightly depressed in Melbourne.

        I will give you this, Sydney architecture is terrible compared to Melbourne and pretty much anywhere else. But that’s symptomatic of being nestled within natural beauty vs a flat wasteland.

      • Who needs to deal in facts when we can predict where someone’s from by how they look?

        I hate to burst your bubbles, but people in Melbourne simply do not talk about Sydney. You could be forgiven for thinking that it didn’t exist.

    • Melbourne people think it’s so much better down there. The vibe, the restaurants and cafes. It’s exactly the fking same.

      • The difference is in the denizens.

        Sydney folk talk A LOT about what their home highlights are and what you can do, even though they never do it.

        Melbourne punters get out and enjoy what they have…on days that weather allows…

    • I was born and bred in Sydney, worked the globe, came back to Sydney. Couldn’t stand it and moved to Melbourne. Bought a house for hundreds of thousands less like for like than Sydney. Couldn’t be happier down here, and according to those age old baseless rumours of city rivalry I should ‘hate’ Melbourne, right? That’s all nonsense.

    • I think all Australian cities can be pretty parochial when they get going. As I have mentioned here before a kiwi mate summed it up best for mine when he described Sydney and Melbourne as not being different enough from each other to be exotic but different enough to be irritating.

      I was born a Victorian man, with origins going back to the founding of Melbourne, and went to Uni there amongst people who tended to assume that the world revolved around Melbourne, and had family steeped in that sort of tradition, and in my opinion tended to be overly sensitive about Sydney. It was also noticeable that much of corporate Melbourne had an attitude revolving around who went to what school (or sometimes Uni).

      Later work took me to Sydney, which I never really took to, but where I did come to the conclusion the school set was less of a focus than in Melbourne, and that if you didn’t tell people you were from Melbourne Sydney people rarely ever mentioned it. If you did mention you were from Melbourne I found them surprisingly anxious/defensive about some issues. I never did come to any firm conclusions about whether this was because they were expecting a similar sort of defensiveness/anxiety from me – but often suspected that. I also found Sydney weather not quite what I had expected insofar as it always seemed quite steamy to me (though to be fair I lived there during a period in the 1980s when it actually rained every weekend one year from September to Christmas).

      Since those days I have lived in Canberra (surreal), Hobart (which I loved, but which never has any pretensions to being other than an island capital at the buttock end of the world) London (the real McCoy global city for mine – but chock full of sheisters, scammers, people on the take and people telling themselves they are there for culture when they get to something cultural about once a year) Istanbul (my favourite city) and Moscow (pulsating energy, distilled chaos – can be a lot of fun but you need to be in the right circumstances and I am sure it is hell for many).

      I came back to Australia to live in Geelong mainly because I thought Melbourne by and large had its head up its backside (on no subject more than real estate prices) and I had no real reason to be living there. In the field I was in at that time I had people offering me gigs in Sydney which I politely declined (on a cost of living basis, and for family reasons, and the fact that I am now in family raising mode, as much as any emotive response to the place) and when I did this there was a sense of ‘why wouldn’t I want to live in Sydney?’ often with what I thought was a sense of insecurity. I don’t think Sydney is all that global (I think it overrates itself as a financial centre, and I tend to the view that Singapore could make a reasonable claim to being the financial capital of Australia in years to come) but I do think Melbourne is more parochial (and is more reflexively inclined to compare itself with Sydney than vice versa). Melbourne certainly has a far smaller international profile. A lot of people overseas wouldn’t be aware there is another large city in Australia apart from Sydney and it is often assumed to be the capital of the place.

      • this “sydney is a financial city” crap makes me laugh. There is only two criteria on which Sydney even appears on the financial radar:

        *facilitating ever-increasing loans to one another for existing houses: check.

        *facilitating the financial sacking of one country (china) on a scale not seen since the vandals sacked Rome: check.

        on any other measure, especially international finance/trade it’s the equivalent of a country town with a combined post office, bank and general store.

    • All Australian cities are provincial and not world class. That in addition to the fact that an average house prices in all Australian cities are more expensive than in NYC tells how big bubble we have.

      BTW. Due to my parents and my own lifestyle I was lucky or unfortunate to live in Sydney, Paris, Glasgow, NYC, Washington, Houston, Austin, SF among the others

  2. Those who complained about animal spirits, this story is all about about it.

    “nobody knew the dollar would drop to 77 US cents”
    someone send him a Macro subscription he will learn something.

  3. Out of my group of friends, only two of us buck the trend, out of my family and close relatives I’m the only who bucks the trend. Lost a girl friend about this subject. We’re always wrong because it’s ‘not the same’ they say.

    This is going to hurt so much, I will almost be happy, and buy that time I will move overseas, although Europe is not perfect by any means. Better then what is going to happen to this place.

    *Grabs popcorn*

    • The Traveling Wilbur

      Hope you took a photo of the real estate ad of the property that she wanted to buy. You can send it to her in 2-years when the place is on the market again for (assuming you’re in melb) 60% of the price. But be nice about it. There’s no reason for teaching lessons like that to be rude or nasty. That way, she’ll know for next time, and won’t nag the next bloke so much. ; )

  4. So in the context of the biggest housing bubble this country has ever seen, our RBA thinks it “prudent” to cut the price of mortgage debt to the lowest level in history.

    Stevens and his cheerleaders will be judged harshly.

  5. This is a great piece for people who aren’t sure of what’s happening with the property market.

    Unfortunately the majority are very sure of what they think is happening to the property market. Ask any taxi driver or shoe shine boy – property is all about growth 4 eva.

    • I must confess I referred a work colleague to this particular story and he referred to his brother and he having made 30K on a two bedroom apartment in the outer burbs of Geelong in a year.

      Until the punterariat start experiencing losses they will go with the money they are making.

      That said I know of places in the outer burbs of Geelong which have recently sold for less than they were purchased for 18 months – 2 years ago.

      • A friend who works as a tax accountant, is seeing losses around inner city suburbs and smack bang in the CBD. Any property purchased around 09 – 10 is selling for a loss.

      • “he referred to his brother and he having made 30K on a two bedroom apartment in the outer burbs of Geelong in a year.”

        I call B****** – unless they got very very lucky.

        Was that a realised gain or one they think they have made?

      • Nah, they have actually made the dough. 30 Grand in a year. Purchased 200K Jan last year and sold 230 this week past so I was told. I dont think he is bullshitting.

      • @Gunna

        Buying at 200 and selling at 230 is surely a loss (question)?

        i am unsure of the exact costs involved but to make net 30K would I guess repeat guess require a gross 55 of even 60 k ‘gain’.

        I am not saying they are not being honest that are many examples of such madness around the traps.

      • Why did they sell?

        Property only ever goes up and by buy selling they are incurring transactions costs when they could have sat back and enjoyed paper profits to the moon.

        Equity withdrawal mate – its there to be spent !

      • “A friend who works as a tax accountant, is seeing losses around inner city suburbs and smack bang in the CBD. Any property purchased around 09 – 10 is selling for a loss.”

        Wait until the stuff sold off the plan doesn’t value-up at time of loan draw down and ‘investors’ can’t settle.

        Banks instantly become owners of large amounts of apartments.

        See 2008 on the Gold Coast and HBOS/RBS for example 1.

  6. Looking at the building approvals for Victoria. There was approval for $8.7 billion worth of Residential buildings but only $95 million worth of Factories and Secondary Production Buildings.

    Maybe it is tell to pray…. (in the $50 million worth of Religious buildings approved).

    But don’t worry there was approval for $246 million dollars worth of Entertainment and Recreation buildings. *smacks head*

    • Well there is a guy called Matthew Guy, who from memory has actually become the leader of the state Torynuffs, who is showing little embarrassment about the corruption around the east west link tendering process, who is also responsible for an inordinate amount of that apartment construction in the CBD…..

      Should be good to be still building when the price collapse sets in. Must be taking a leaf from the big iron ore crowd.

      …..though I did catch him speaking at length (in Ukrainian) about support for the Ukraine oligarch set recently.

  7. 1840s – depressions. 1890s – long depression. 1930s – great depression. 1970s – rolling recessions and the birth of the mega debt bubble.

    2015. Why do people not pay attention these sorts of cycles or deny the risks?

  8. And there you have it, a real investor who has cashed out and moved on to bigger and better things. Just how much has he made by converting assets denominated in AUD to USD?

  9. There are multiple property markets across Melbourne and Sydney. But generalising, I don’t buy for a moment that there will be a huge differential in prospect, when/if the crash comes.

    Why? Two reasons- there is already a huge differential in price in favour of Sydney for comparable properties/land. And, secondly, for various reasons, Melbourne has a higher population growth trajectory.

  10. IMHO the whole Melb v Syd conversation is a moot point based on emotion and sentiment. The real piece of this story is how over valued Melbourne is, and how a true investor (not a mum and dad punter) views the market in terms of value. Its guys like this that feed off the bigger fools in the market – no doubt this guy would be selling his property at or near the top to the lemming investors with their SMSF’s and negative gearing who think they are getting in at the ground floor.

    Yes Melbourne is overvlalued hugely by any means, well covered here already. Sydney is not comparable to London on facts. GDP of London is around $750bn whereas Sydney is at best $270bn, putting it on par with rust belt Detroit. London also has GDP per capita of around $150k compared to Sydney of around $67k. Any way you look at it, the fundamentals make Sydney just more and more overvalued.

    • except that london is a grim awful place, and Sydney is sited on a beautiful coastline.

      But otherwise good points. Interesting to see the GDP difference I didn’t realize it was that great

      • London is a 45min flight away from Europe – and close to the Oligarchs homeland.

        Sydney is stuck in the arse end of the World

      • I thought the latest trend among the ultra-rich was to buy bunkers in new zealand

        Seems like being at the arse-end of the world could be an advantage

      • All a matter of taste. I lived in London for 7 years and been in Melbourne for the last 6. Personally I would take London any day. Yes the weather can suck but in any other aspect it is superior for my personal needs.

  11. Drapac is citing the same measures I shake my head over: price to rent, debt to equity, wages to price, investor proportions, and on. We have a very long way to fall.

    Don’t Buy Now!

    • surely all that matters is interest rates/financial repression david?

      of course the other metrics are going to be way out of whack when interest rates are at all time lows

      • I reject your reducto.

        Australian RE prices were excessive when i rates were just low of long term averages.

        This bubble is driven by bad taxes, restrictive planning, easy debt, feverish speculation and breathtaking naievity around risk. We need to fix it all, particularly taxation.

      • Excessive relative to what?

        We can all agree that high house prices are bad for the economy and the society.
        That doesn’t necessarily imply that prices WILL fall, or that there is some “natural” level to which they are inevitably bound.

      • Coming, my initial comment cites four different measures by which the land market can be judged expensive and distorted. I don’t know how I could be clearer.

        Drapac very kindly reminds us the turn comes out of the blue. Ireland’s was their central banker giving a bumbling door-stop interview in a cardigan, which shattered confidence.

        We have just seen commodity prices revert to mean. I foresee the same in land. When? Have a bag of popcorn…

  12. I regularly talk to taxi drivers about property.

    2 days ago I told one to read MB. He’s just spent $410k building a house inMelbourne.

    I’ll never be able to catch a cab in this town again.

    • All my recent uber drivers have been previous un/under employed and pushed off the couch by their wives to get out there to pay for the mortgage!

  13. I’d be interested to see rumples opinion on this – from memory he pegged the latest few step ups in price..

    • ROTFL – That is hilarious. On paper the richest people in the world are really living like students. Such an enviable lifestyle;)
      One wonders why everyone needs to affirm how good it is here so much….

      • 1.5mil For an absolute shithole in the middle of a desolate suburb of melbourne.

        ‘Out of whack’ is a polite underestimation of how stupid things really are.

        And I’ve lived in Melbourne all my life, and have to say, IT DOES NOT RATE.

        Do you know what 1.5AUD buys in Northern Italy? In Greece? In Paris even?

        F me.

        I hope people are burnt, and burnt so badly they sing nursery rhymes by candle-light (about the great property wipe-out) to their debt-slave offspring 3 generations from now. Living in ‘glen waverley’.

        Glen Fn Waverley!

      • Um, why do you think someone is going to live in that house after its new owners take possession?

        Glen Waverley is 19km from Melb city centre. Are you still in Paris that far from the centre?

      • @StatSailor

        Glen Waverley has a good public school, so Chinese would be all over that.

        Also Glen Waverley is a has decent entertainment, meaning you don’t have to travel to the city for anything other than work.

    • Now watch it get turned to 4 units @$700k each. That’s the typical thinking of Chinese investors.

      Also, Chinese rational thinking goes out the window when you talk about good schools. They wouldn’t think twice for overpaying for education.

      P.s. I went to one of the worst public schools in Victoria, all I could possibly have missed out is 0.80 of ATAR, and extra curricular activities.

      • “Also, Chinese rational thinking goes out the window when you talk about good schools. They wouldn’t think twice for overpaying for education.”

        You do realise that you can access these ‘good schools’ if you rent in the area, for a pittance compared to the cost (and ludicrous risk) associated with buying, right?

        Nobody asks if you ‘own’ or ‘rent’…. you do realise that? right?

        Maybe not.

      • or you can live somewhere more affordable, pay for private (better) schools and take a few free holidays each year for the money you saved buying one of these sh!tholes.

        Destined to become another ghetto, bought by people who have as much knowledge of what they are buying as I do about buying in inner mongolia.

        Lets face it, Chinese property speculation aint exactly going to well over in China, you would think the investors would get it better in their backyard…

      • @Jim

        Private school with high average ATAR are expensive. Year 7 to 12 education will cost up to $150k or $80k with scholarship per kid. It’s actually much more cost effective to go to coaching schools or hire tutors for specific subjects.

        Besides, the ATAR of posh private schools are proper up by scholarship kids anyway.

      • Nah, they’ll build a single 40-50 square McMansion with low maintenance garden (that’s the trend)

      • @Bystander
        Judging what I see in mount Waverley, unit conversions out number new house builds by far.

        You gotta realize most people buy properties to make money. And unit conversion makes the most.

      • Private school with high average ATAR are expensive. Year 7 to 12 education will cost up to $150k or $80k with scholarship per kid. It’s actually much more cost effective to go to coaching schools or hire tutors for specific subjects.

        You don’t send your kids private schools to get better results, you send your kids to private schools to meet the kids whose parents will make the rest of their lives a breeze.

    • $1.5m?

      Are you serious?

      That bathroom alone made me sick – surely not

      The vendor just won the lotto.

      Though if they have lived in that bathroom for the last 20 years – I am not sure a million clams is going to change their ‘lifestyle’.

      • the maths still doesn’t add up

        paying $1.5m for a house which is worth at best $500k leaves you $1m to spend on posh schools. If a private school costs $150k end to end, you could educate 5 kids in private school and still break even for a nice overseas holiday each year.

        This is another logic fail for buying an over priced sh!thole to *save* on school fees. Utterly ridiculous.

      • @Jim

        Hence I said rational thinking goes out the window earlier.

        “worth at best $500k”
        Also to the typical Aussie, the worth of the house is not $500k, it’s what ever average price was last week, which was 1.3 mil at the going rate in Glen Waverley. And property price never goes down. They figure when the kids all finish school in 7 years, they can sell the property to another Chinese family for $3mil.

    • F*** that link is going straight to the pool room.

      If that’s worth anything more than $500k in 2020 I’ll run naked through the streets of Melbourne.

      The only redeeming feature is it’s proximity to the Mountain View Hotel….

      4 Corners should do an expose on the “Private” buyers FFS.

      • Guys,

        Clear as day they didn’t pay $1.5M for the house. They’ve paid that for development potential. At that price they can make money – maybe not as high a percent a local developer would accept – but this is the reality of what is happening today.
        If foreign money bids up land to develop at a smaller profit margin than a local that is their prerogative.
        It has been incredible to see what has happened in Glen Waverley.
        There is no point hoping and wishing for lower prices. We need to face reality here.The money coming in is not only interested in profit. They’re are other motives. There are motives and dynamics at play that distort ‘fundamental values’. IMO the flow of money will increase before it slows or stops, actually I expect it to reach a frenzy before it stops. If I was a holder of land with development potential in any popular suburbs I would be preparing to hit the bid.

    • When this is demolished and 4 new $800k+ units are built on this large block (and sell like hot cakes)…

  14. I was out at the new villawood armstrong creek old geelong airport site last week and was told no titled land available for another 18 months.
    What is wrong with this country ?
    Is it lack of companies doing civil works or too much government red tape?
    Also they line up outside our local real estate office for next land release here in torquay at zeally sands with titled land approximately containing a 6 months waiting period.

      • Agreed StatSailor!

        The are reports from a friend (lives nearby) of farms being ‘optioned’ for several hundred thousand years ago by developers then the contracts lapsing and brand new tractors appearing in the shed!

        At least someone is having a win with all this rampant speculation.

  15. I like and live in Melbourne, but from my recent holidays i have to say sydney wins hands down but you pay through the nose for it which is why I am in Melbourne. Sydney has incredible beauty and natural attractions. Dozens of world class beaches, probably the nicest harbour in the world, hills (they create features), the blue mountains, the hawkesbury river/pitwater, and a lot of nice bush (Melbourne’s is dry and dusty). The climate is for the most part a lot better. When comparing like for like there is no comparison for lifestyle. Melbourne does do sporting events better though. Personally I think the cultural advantage is a furphy. If you are dorky enough to be into posh restaurants, galleries, shows etc you can still find all that in Sydney.

    … oh I forgot, Melbourne has laneways, I’ve changed my mind cause I love walking through laneways

    • plenty of places in the world that have as good, if not better, beaches, cafés and scenery than Sydney. But at much more affordable prices.

      You cannot justify the stupid prices paid by any other measure than rampant speculation. It went up yesterday so will go up tomorrow mentality that always ends so well.

      • i’m not saying Sydney is not stupid, but believe it is fairly priced relative to Melbourne (which is also stupid). But lets be honest. Sydney has unique attributes. I can’t think of a 4 mill plus city in the first world with the kind of lifestyle it offers. Sure its not New York / Paris etc, but it does have much better beaches, climate and harbour. People do seem to pay a premium for a “best of both worlds” of job opportunites and picturesque beauty eg San Fran v Houston, Auckland v wellington, Sydney v melbourne, Vancouver v Toronto.

      • The thing I don’t get is the majority of Sydneysiders don’t live in the beautiful harbour and beach side suburbs, they live in Western Sydney in places like Rooty Hill and Liverpool, hours away from the beaches and harbour in a nightmare of horrendous traffic, crumbling infrastructure, and outrageous living costs.

        Sure, if you live in a mansion in Mosman, then the quality of life is probably second to none.

      • What arescarti42 said.

        The Harbour, and select other parts of Sydney are rather splendid, especially if you bought into them many years ago and have some disposable income, so it is understandable why it might be expensive. But the majority of the city where most of us live is very ordinary, not to mention a real pain to get around these days, so the prices being achieved are quite insane.

    • Its true -sydney’s nicer weather and regular rainfall has it over Melbourne any day – equally the harbour and surrounds are particularly nice for a capital city.

      But if you dont live near the water, do you really live in Sydney?

  16. So Adelaide it is then ( its funny how you hear what you want to hear), im sure we have better weather, and we have laneways and trams(!?).

    It is a worry when the big guys get out of the market ( but could it be sour grapes that he could have made even more money?). Almost as alarming as all the stories of “for sale/lease” signs in Perth going up everywhere ( but all ive actually seen is the one port hedland property being passed in).

    At least my anxiety of ” did i spend too much, what if it all goes pear shaped” is helped when hearing of what its like on the eastern seaboard, if only for a short time.

    If 10% of Chinese and Indians elite (say top 5%) buy a property here every 7 years, how many of us can expect a lotto windfall?.

  17. Michael Drapac didn’t raise anything I didn’t already know, but somehow, its still comforting to hear those words of doom coming from a property developer.

      • I will be worse off when the downturn hits. I’m a homeowner. Yet I will still take great satisfaction when it occurs. The obsession with housing is wrong on many levels. We will be a better country when the obsession ends. It needs to end.

        I think 2015/16 will be the start of the downturn. Sufficient planets have aligned.