Interesting was an aricle in the September issue of Money magazine written by Max Walsh, an economist who also writes in the Bulletin. In reference to house prices to median income Walsh states “The Sydney normal ratio of house prices to wages is around 6. In Melbourne it’s around 5 while in Perth, Adelaide and Brisbane it has been around 4.” This is an interesting comment which shows that Sydney is still significantly over priced where P/E ration is about 10. Does anyone disagree with his statement in regards to “normal” market P/E ratios?
Is this another way of saying gross rental returns?
How are P/E ratios calculated in real estate?
We buy properties in Adelaide. Immediate Cash Settlements, No Real Estate Agents, No Fees.
[email protected]
phone 0412 437 582It shows that there is greater demand for available property in Melbourne and Sydney.
Basic market = supply and demand!
Live, Learn and GrowLifexperience
Yes, DR. X you are right it is an inaccurate use of the term, P/E usually being associated with Gross Yields in regards to property. I meant to say median house price/median earnings, hence how I got p/e.
You must be logged in to reply to this topic. If you don't have an account, you can register here.
