Renting a House

By: Amos Grham

This is indeed a frightening thought for many Australians. However, for many renters, costly house prices are turning the great Australian dream of home ownership into exactly that - a dream.

Renters, especially those saving to buy, have survived several harsh setbacks this year. Agents revealed that in over 85% of cases, rents have increased in the past 12 months, and are likely to continue to increase until 2009. This will be around the time when a new upsurge of apartments is expected to come onto the market, easing the shortage.

At the same time, interest rates skyrocketed three times since the beginning of 2006, making a total of eight times since 2002. This has destroyed the borrowing capacity of prospective buyers. Those who dreamt of home ownership have had their dreams dashed. Melbourne's current 284,000 rented households must make big decisions this year. To buy or risk being pushed out of the market.

It is a sad state when the gap between the 'haves' (investors) and 'have-nots' (aspiring home buyers) is widening, and analysts do not predict changes in this trend any time soon. Moreover, median house and apartment prices have increased by such a huge margin, and are continuing to increase, particularly in the inner city where tenant demand is strong. We all must be aware of course that this has brought a smile to the face of investors.

Furthermore, the value of the investors' property portfolios has increased in recent years. This most certainly provides tens of thousands of dollars in equity, which in turn enables them to buy more property. Renters, by comparison, must make serious lifestyle changes to go up against rising rents, rates, stamp duty, and real estate values. The easiest way to check on rental and homes to buy is online at OzFreeOnline.com in their Real Estate section you can register, login, and search the thousands of real estate property listings all for free!

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