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If you want to stick with Frank Lloyd Wright protégé's houses, this house in Melbourne really does it for me.
It was designed by Walter Burleigh Griffin, who was born in Chicago and worked under Frank Lloyd Wright in the 1900s. He emigrated to Melbourne, where he designed several houses, and laid out the suburb of Eaglemont. He would subsequently go on to plan Castlecrag in Sydney, and Canberra.
I took a look around the house last time it was on the market in 2016, and it's a lovely place. It's undergone one of the few renovations that actually significantly improve it.
However, since this is an imaginary "if I were rich" purchase, I would also pick up the neighbour, which was carved out of its block.
Unfortunately, the asking price on this property is now $4.4 million (about $3.4 million US), and the neighbour last sold for $2 million in 2016, so would be rather a lot more now…
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Damn, that really is lovely.
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Wow that's wild! Looks like concrete block?
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This is my dream property:
https://www.bcarc.com/residential/edgeland-house
This lot is just east of downtown, on the bank of the Colorado River. The property owner bought an old brownfield lot and did a considerable amount of land remediation due to an old existing oil pipeline on the property. The house has all sorts of energy conscious features and is largely unnoticeable from the street which I love. The wildflowers and native landscaping are right up my alley too. The only downside is that I would need a garage/workshop.
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A friend worked with the developers of this modest, unassuming little property.
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@mclaincausey - at least they chose the right listing company!
Nearly an identical home sold by us in DC area last year - I actually had to do a double take!
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Wow that's wild! Looks like concrete block?
It's built with Burley Griffin's Knitlock system, which uses specially shaped concrete sections that fit together to build a wall.
Students in Melbourne University's architecture department ran a project on it a few years ago, and recreated Pholiota, which was Walter Burley Griffin's own rather modest home. (It had about 450 square feet / 40 square metres of internal space.)
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I was browsing property listings in Sydney earlier, and this little place came up.
Two bedrooms, needs a bit of a renovation. Could suit me.
Of course no guide price is given, so I dig around in the web page's metadata and get the marketing expectations: Around $3 million (Australian), which equates to $2.2 million (US), £1.6 million, or €1.9 million. :o
I think that I'll pass…
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@goosehd the rate of increase might have slowed down slightly from July, but they haven't gone into reverse.
I agree that it's crazy and it sucks. Sydney prices make me think that the Bay Area in the US is reasonable, and I could get paid twice as much if I sold my soul to Zuckerberg.
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I've not really been looking. I have thought for a long time that prices are high, but the housing market is cyclical so they'll come down eventually.
And then they double. Again. :o
The trouble in Australia is that there hasn't been a crash in recent memory. Unlike (say) the US or Ireland, prices didn't fall significantly after the Global Financial Crisis in 2008, so there's a belief that property is a one way bet. Plus the government pumps the market up with incentives whenever it starts to slide.
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I hope you're well @Graeme with all the things going on down under.
It really saddens me to see the housing markets the way they are. Historically the US has had about 60% home ownership, and I feel like that will be taking a dramatic dip in the coming years. It really can be such a great tool for building personal wealth and stability, and I'd like it to be broadly available as possible to responsible homeowners.
Perhaps it's a bit of a conspiracy theory, but when the financial services industry lured homeowners into refinancing, and the homeowners could not pay when the variable rates spiked on them, those bad mortgages had been bundled into instruments that were traded on Wall Street. When those instruments, comprised of toxic mortgates that started defaulting, failed, it created the 2008 financial crisis. Wall Street should have been left holding the bag, but ultimately we taxpayers bailed them out. We see none of their gains, but we provide a safety net for their losses. My conspiracy theory is that the financial sector has figured out it's better for them to own the houses and lease them out than it is to predate on mortgages. So I believe we will continue to see more and more financial interests such as hedge funds buying up real estate to rent it out, because they can simply kick out residents who can't pay the rent, which they can raise at will. This along with short term rentals is perverting residential markets and denying homeownership to many deserving people.
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@mclaincausey we're okay here, though I'm expecting Godzilla to stomp Sydney or Melbourne this weekend the way things are going.
In Australia, I believe that around a third of households are property investors, with most owning one rental. It's much more Mom and Pop than Wall Street. The tax system provides incentives, such as negative gearing (any interest losses can be written off against your total income), depreciation (wear and tear on a new build can be claimed), and capital gains (if an asset is held for more than a year, gains are taxed at half the rate of earnings).
The combination of negative gearing and capital gains means that a lot of investors are willing to eat a loss in the short term to make it back (and then some) as values appreciate. For example, I saw a townhouse in the best suburb of Melbourne to rent. It costs $750 per week, which would equate to repayments on a mortgage of $800K. It probably sold for twice that, the sales data hasn't made it onto the online system yet.
My back of the envelope calculations suggest that at current rates, interest payments will be about $40K a year, the rent will be a similar amount, and there would be agency fees, property taxes, and maintenance, let's call it $20K a year. The investment would lose $20K, but (I think) negative gearing would reduce that to around $10K for a top rate taxpayer.
The investor is probably thinking that if they hold it for a decade, their after tax loss will be $100K, but the property will have doubled in value. So they might have made $1.6 million in profit, which would attract $400K in taxes (the top rate of around 50% is halved for capital gains), which nets out at $1.1 million after their losses over the decade.
So investment becomes speculation on rising property prices, rather than trying to secure an income from an asset, and I think that's part of what's driving the Australian market.
At the same time, neither the government, central bank (RBA) or financial regulator (APRA) want to take responsibility for the boom. The RBA says it's not a part of their charter, APRA says that they are policing institutions, and have the politicians own investment properties, so they're not going to kill the golden goose.
The net result is that there's been a collapse in home ownership in the under fifties, and this is more pronounced in younger age groups. The obvious way to fix this would be to allow prices to fall, but every time they slip, a scheme is introduced to prop them up!
