There’s nothing to aspire to in Australia’s capital cities for new property market entrants with capital growth looking uncertain at best. If you’d purchased an apartment in Brisbane two years ago for $500k (where the market has gone backwards) and plan on holding if for three more years to get it back to $500k valuation, you’d have paid a total $200k in repayments over the 5 year period.
With a typical home loan, that would have meant $150k in interest payments and $50k in equity in 5 years. (these figures were pulled from our handy dandy home loan comparison tool). Stamp duty and other transaction charges on the next place you buy will likely wipe out much of those equity gains if you sold after 5 years. Hardly a goldmine of wealth if you are new (read late) to the market after the many years of capital growth has happened over the past twenty years.
So, more and more housing advocates in the US are touting the trend towards tiny homes, such as Lloyd Kahn. We’ll be featuring more of the tiny homes that Lloyd has collected in coming months. It shows the can-do, hands-on attitude people are taking towards creative accommodation they build themselves for a fraction of the price of a ‘NewHomeWorld’ McMansion.
Why? The trend towards tiny homes reflects back to us what a crazy predicament we are perpetuating in Australia. We have a ridiculously large land mass in this country and space to burn with just a small population here, yet we have crazily priced houses and local councils that make it impossible to do anything creative. Yet, we are heading towards a housing shortage in NSW. We don’t need more developer owned tracts of land with McMansions at high prices, we need creativity for those who want to get out of this ridiculous cycle.
This mobile home featured below is $15k on Craigslist in the USA. Mortgage free and mobile for a home that is just $15k and can be parked anywhere. Brilliant.