# Housing Affordability - a return to Feudalism?



## Bushman (21 April 2010)

The great housing affordability crises continues un abated, with one in three Gen Y respondents expecting to be 'permanently locked out of the housing market'! No wonder there has been a massive fall in loan applications. Who wants to sign up for an LVR of 95% in a rising interest rate environment. 

The alternative for Gen Y is to buy into the urban sprawl away from public transport and amenity. 

My parents generation (Baby Boomers) were born into a life where employment and home ownership were a given. Globalisation has taken care of the former and now the generous landlord tax concessions/FIRB rule relaxation is taking care of the latter.  

So the Boomers have effectively sold their Gen Y progeny into a neo-feudalism where the landed class gentry will assign a whole generation to the role of wage slave. Increasingly the land lords could also be foreign. FUBAR! 

At some stage in the future, the Boomer estates will need to be sold off and the pricing will need to take into account the mismatch between those demanding property and what their earning capacity can bear versus the over supply of investment properties being realised. That will be some correction IMO.

This is my tip to become an increasing political issue as Gen Y get angry at the bitter pill they have been forced to swallow and make their political views be heard. 


From today's The Age: 

' “We have never seen such pessimism amongst prospective first time buyers throughout the past five indexes,” said Vittoria Shortt, chief executive of Bankwest Retail. “Seventy per cent of respondents were very concerned about the level of debt they will be committed to if they buy a property.”

One in three Generation Y respondents, those born between about 1980 and the early 1990s, said they *expect to be permanently locked out of housing market*.'

http://www.theage.com.au/business/property/homeownership-dream-dims-for-gen-y-20100421-ssdp.html


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## nunthewiser (21 April 2010)

Its ok .......... If anyone can save us, Rudd can


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## WaveSurfer (21 April 2010)

Gen Y are lazy slackers that want it all and they want it now. Not willing to pay the price for it either. A vast majority of them anyway. 

All I have to do is look at my siblings and their friends. They see what the oldies have and they think it should be handed to them on a silver platter. 

Opportunities are still there in abundance, believe you me. I see them every day. Just have to open those peepers, be prepared to sacrifice and realise that the dream home is NEVER your first home. Was the same for the boomers, and it will be the same for every other generation.

And not to forget that interest rates are at their lowest levels ever... Opportunity is there for the taking.


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## chode84 (21 April 2010)

My fiancÃ©e and I purchased our first property about 18 months ago. We signed the contract 10 days before Rudd introduced the stimulus package (annoying) so the interest rates were at their highest point for that cycle. We were only 24 at the time and by no means earning any more then anyone else our age. She was on about 25k as she was and still is studying and I was on 50k at the time. So 75k all up which is f**k all really. 

The key to us being able to buy was moving from Sydney to Port Macquarie. Our property is a town house with no common walls and a backyard and we are 100m from the beach on the main beach drag. It cost us a measly $220,000 (3 bed two story).  It was absolutely horrible inside when we bought it but I renovated it for around $11,000 and its worth around about $280,000 now. 

The point of my rant is that property is acquirable to gen y if they are prepared to live out of the city. Even if they get something somewhere they don't wish to live but rent it out! Its really not that hard.


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## Mofra (21 April 2010)

WaveSurfer said:


> Gen Y are lazy slackers that want it all and they want it now. Not willing to pay the price for it either. A vast majority of them anyway.



The only think worse are boring sterotypes from Baby Boomers, easily the most useless generation in Australian history.

In any case, we need a two birds, one stone solution here - with the number of foreign property holdings sitting idle, and the relatively strong squatters rights in Australia, all we neeed to do is start advertising which properties are unoccupied, foreign owned dwellings and let "market forces" do the rest of the work


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## Bushman (21 April 2010)

Mofra said:


> In any case, we need a two birds, one stone solution here - with the number of foreign property holdings sitting idle, and the relatively strong squatters rights in Australia, all we neeed to do is start advertising which properties are unoccupied, foreign owned dwellings and let "market forces" do the rest of the work




Apart from the gold rush of the 1850s, a lot of the old Victorian money was made by squatters who grabbed the fertile farming land i.e. the old school 'Squattocracy'. I like the idea. The land banking that is going on in ressie is nuts at the moment. 

For full disclosure purposes, I am not Gen Y (rather Gen X of Nirvana fame) and I own my home outright. I would hate to be buying a first house within cooee of any major CBD. Urban sprawl is unsustainable in the long-run with significant social and environmental costs. 

Sorry if any of this sounded like Boomer bashing which is not necessarily my intention. H/e landlords and homeowners objecting to inner-city medium to high density infill is a particular bug bear of mine. 

'Ooh but it might detract from the value of my multi-million dollar fortress'. Give me a break.


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## satanoperca (21 April 2010)

Mofra said:


> The only think worse are boring sterotypes from Baby Boomers, easily the most useless generation in Australian history.
> 
> In any case, we need a two birds, one stone solution here - with the number of foreign property holdings sitting idle, and the relatively strong squatters rights in Australia, all we neeed to do is start advertising which properties are unoccupied, foreign owned dwellings and let "market forces" do the rest of the work




Now that is thinking outside the square. Plenty of uni students who would love to take up residence in a nice house in Mosman or Toorak, free of rent.

Cheers


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## ChilliBlue (21 April 2010)

Advise to anyone who wants to buy their own home

Spend less than what you earn
Buy something small as early as you can
Give up outdoing the Jones's 
Try living as frugal as you can


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## kgee (21 April 2010)

Or let the living come easy ...shift to somewhere more affordable....Sth East Assia, Carribbaen, C. America,
Like NZ watch what the brain drain does


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## Chris45 (21 April 2010)

Mofra said:


> The only think worse are boring sterotypes from Baby Boomers, easily the most useless generation in Australian history.



Nah, that title definitely belongs to the video-game generations whose lives of sex, drugs and video games are financed by Centrelink while they live at home and sponge off their parents. They can't spell and they need a calculator to work out 1+1. They can’t even play with a toy unless it comes fully assembled from the factory with the batteries pre-installed. The problem is each new generation is worse than the previous one. Pretty soon they won’t even be able to take a dump without a robot there to clean up after them.:


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## MACCA350 (21 April 2010)

Chris45 said:


> Nah, that title definitely belongs to the video-game generations whose lives of sex, drugs and video games are financed by Centrelink while they live at home and sponge off their parents. They can't spell and they need a calculator to work out 1+1. They can’t even play with a toy unless it comes fully assembled from the factory with the batteries pre-installed. The problem is each new generation is worse than the previous one. Pretty soon they won’t even be able to take a dump without a robot there to clean up after them.:



Somebody work out where that round shiny disc thingy goes, mashed some buttons on a rectangular thingy and watched Wall-E, did they


I'm not a Gen Y, and I'm kidding: 

cheers


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## WaveSurfer (22 April 2010)

Mofra said:


> The only think worse are boring sterotypes from Baby Boomers, easily the most useless generation in Australian history.




That may be the case, but don't forget that they are also the most successful.




Chris45 said:


> Nah, that title definitely belongs to the video-game generations whose lives of sex, drugs and video games.....




Hey, don't knock the old Atari :


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## cutz (22 April 2010)

WaveSurfer said:


> That may be the case, but don't forget that they are also the most successful.




That's a broad sweeping statement, what's your basis ??

I think you may be confusing success with luck.


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## Chris45 (22 April 2010)

MACCA350 said:


> Somebody work out where that round shiny disc thingy goes,



Do you mean those big shiny black disc thingies? Ha! Figured that out a long time ago sonny boy! Arm gets a bit tired cranking the damned handle though these days.


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## MACCA350 (22 April 2010)

Chris45 said:


> Do you mean those big shiny black disc thingies? Ha! Figured that out a long time ago sonny boy! Arm gets a bit tired cranking the damned handle though these days.



Hehehe, nice comeback mate

cheers


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## Mofra (22 April 2010)

Chris45 said:


> Nah, that title definitely belongs to the video-game generations whose lives of sex, drugs and video games are financed by Centrelink while they live at home and sponge off their parents. They can't spell and they need a calculator to work out 1+1. They can’t even play with a toy unless it comes fully assembled from the factory with the batteries pre-installed. The problem is each new generation is worse than the previous one. Pretty soon they won’t even be able to take a dump without a robot there to clean up after them.:



Yep - Gen Z. 

Gen X (myself) tend to be the most responsible of the lot in my completely biased opinion


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## Mofra (22 April 2010)

Bushman said:


> Apart from the gold rush of the 1850s, a lot of the old Victorian money was made by squatters who grabbed the fertile farming land i.e. the old school 'Squattocracy'. I like the idea. The land banking that is going on in ressie is nuts at the moment.



Land banking is bad enough, however Melbourne is apparently the 11th largest city in the world by land area - that in itself is an indicator of how poorly managed the growth of Melbourne has been managed by successive governments over an extended period of time.


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## Mofra (22 April 2010)

satanoperca said:


> Now that is thinking outside the square. Plenty of uni students who would love to take up residence in a nice house in Mosman or Toorak, free of rent.



... and sharehouse living is almost a right of passage for uni students as well so we effectively have a disincentive for foreign purchases of high end properties combined with cheap/non-existant rent for the group of people who are most likely to be poor short-term yet contribute most heavily to our tax revenues long term.

When Ruddy holds another pow-wow of minds again after running out of ideas, I'll demand my seat!


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## Bushman (24 April 2010)

OMG Ruddy has already back flipped on the relaxation of FIRB rules re foreign ownership! Someone should really start a 'Rudd back flip' thread. 

An improved version of Howard Populism is this Krudd government.

http://www.theage.com.au/business/hammer-falls-on-foreign-investors-20100423-tjcy.html

But housing affordability was always a ticking time bomb.


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## Bafana (24 April 2010)

Mofra said:


> The only think worse are boring sterotypes from Baby Boomers, easily the most useless generation in Australian history.




LOL Baby Boomers and Gen Y's dissing each other. Both of you are now dependent on Gen X and will be till the day you die, both have failed to care for anyone other than yourselves. Seriously the boomers amass and spend their wealth whilst allowing their children to go it alone into rising debt and the Gen Yers want it all now but don't want to work for it (entitlement should read, entitled to a kick up the ****)

Back to the OP, I agree with his opinion. Now where expand my lands next so that I can have more serfs and buxom serfettes. If your not in property right now it's not going to get any easier. That said have been in Singapore for the last two weeks and the lcoals there are also worried about a similiar situation.

IMO it may be a case of delayed bubbles bursting (damn there goes my servile wenches theory)


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## Mofra (24 April 2010)

Bafana said:


> LOL Baby Boomers and Gen Y's dissing each other. Both of you are now dependent on Gen X and will be till the day you die, both have failed to care for anyone other than yourselves.



Read a little higher Baf, I am gen X


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## Julia (24 April 2010)

Mofra said:


> The only think worse are boring sterotypes from Baby Boomers, easily the most useless generation in Australian history.






Bafana said:


> LOL Baby Boomers and Gen Y's dissing each other. Both of you are now dependent on Gen X and will be till the day you die, both have failed to care for anyone other than yourselves. Seriously the boomers amass and spend their wealth whilst allowing their children to go it alone into rising debt and the Gen Yers want it all now but don't want to work for it (entitlement should read, entitled to a kick up the ****)



There is absolutely nothing I hate more than stupid generalisations like both of these.
Every generation has its variety of responsible and irresponsible people.

In particular, to suggest that the boomers have not cared for anyone other themselves is particularly ignorant.  Many of them are caring for ageing parents and still have children living at home, some of this latter generation being apparently reluctant to take responsibility for themselves.

Likewise, I know plenty of GenY people who are motivated and responsible.

Also have Gen X neighbours who own their home outright, plus the same with an IP and a block of land.  The female partner is now at home with their first child.

By all means complain about particular characteristics where you can justify these.  But you are both doing yourselves a considerable disservice by making these rubbish generalisations.


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## Bushman (27 April 2010)

This is how the Chinese government has popped its housing bubble.

Banking rules announced to curb propety investment.

1. Banks are now forbidden to lend investors more than 50 per cent of the sale price (in Australia, 100 per cent is common). 
2. Investors must now pay a premium of at least 10 per cent above the normal interest rate, while first home buyers receive a discount. 
3. New loans are banned to investors who already have one property. 

Lol; imagine the storm in Australia if the banks were curtailed in their efforts to lend to the ressie market.


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## Bolle (27 April 2010)

Bushman said:


> 1. Banks are now forbidden to lend investors more than 50 per cent of the sale price (in Australia, 100 per cent is common).
> 2. Investors must now pay a premium of at least 10 per cent above the normal interest rate, while first home buyers receive a discount.
> 3. New loans are banned to investors who already have one property.




my god that's inspired.   what a shake up that would cause here.


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## Knobby22 (27 April 2010)

Bolle said:


> my god that's inspired.   what a shake up that would cause here.




Wow! I admire them even as I am fearful of such government control.


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## Bolle (27 April 2010)

BTW i'm gen X and i feel mostly overlooked by everyone.  No free education, no guaranteed jobs, little to no help from parents, foundd it hard to buy a house, the only way in was hard work, no big grants or incentives, no low interest rates - i also had difficulty getting a loan when i was single, got turned down for lack of savings (ok fair enough) and being seen as unreliable because i was single.  what??  presumably they meant i might have a baby at any moment and be unable to work, but still... what??   Now, they give mortgages to single 21 year olds to build McMansions.  wtf?  My first home (still in it) is a 2br shoebox.  We have a family of 4 in here.

from what i see, gen y get a LOT more help from their parents than my generation ever did.  Many Gen Y'ers i know are either living with their parents and saving up, or have bought house with massive help from parents, as well as having their parents (baby boomers) providing them with food, cars, whatever else they need... and the Gen Y'ers with mortgages all seem to be single, with a big 3-4 bedroom house to rattle around in.  Meanwhile the Gen X'ers i know are, like myself, variations on the theme of having a few kids, tiny house, reasonable/modest mortgage, one income + some part time work from the stay-at-home partner.  

And to that comment earlier someone made about the financially realistic Gen X left supporting the baby boomers and the gen y'ers; i say, amen brother.  i've felt this way for a long time.  Forgotten, overlooked, can't get promoted cos baby boomers hold those jobs, can't hire underlings because gen Y don't do the job properly.


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## WaveSurfer (27 April 2010)

Bafana said:


> LOL Baby Boomers and Gen Y's dissing each other....




Huh? When or where did I or anyone else say that they were a boomer or a genny? I'm actually an X if you must know, and proud of it. Worked damn hard for every penny I have and didn't receive any hand-me-downs. 

There's a lot to be learnt from the silent and boomer generations. Lucky or not, they worked hard to get where they are, they are the most successful in terms of _achievements_ and we could all learn a great deal from them.

You learned how to walk only by watching others do it, apply the same principle to everything else you want in life and the world is your oyster.


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## WaveSurfer (27 April 2010)

Bolle said:


> BTW i'm gen X and i feel mostly overlooked by everyone....




Never underestimate the underdogs


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## Neutral (29 April 2010)

The Baby Boomer generation had it easiest regarding housing affordability. Owning a house was a given right relatively speaking. The 'Australian dream'.

Gen X had it harder as house prices rose and people started the investment property wave.

Gen Y come into the housing market...
The property investment wave has turned tidal wave with the extreme lack of regulation on negative gearing (the main culprit), foreign investment & no transparency on realtor sharks artificially inflating prices for their own greed.
Gen Y have it the hardest and only God knows how they are going to afford to pay off a house with a current median price at $450k (& rising) with interest rates also on the up. House prices aren't relative to wages anymore.

If Gen Y can make the repayments then they will have to sacrifice food, electricity & also any semblance of a 'life'. No life = downturn in hospitality & enterntainment industry which = layoffs = business closure = tourism decline etc. A literal slave to their wages, bank mortgages and government taxes. Heaven forbid thinking about having a family! Are future generations to be born into this slavery in a supposed 'developed nation'? I'm struggling to see the upside, excuse my pessimism. 

CARE Australia will aptly have to start caring for Gen Y Australians with food & money donations. None of this donating to 3rd world countries anymore! We can't even afford to feed our own! 

Gen Z are either going to be renting forever (see Gen Y above) or the housing bubble will finally burst and they will get lucky. Time will tell.

So as you can see, Gen Y & Z will be relying on government support more than ever, which means higher taxes for everyone. Yay! 
Let's thank governments past & present for the HUGE mismangement/corruption & utter lack of foresight to end up where we are now. Because anyone with even half a brain would realise what has been going on. Higher property prices means more tax revenue after the banks ever growing record profits off record mortgages & not to mention a harder & longer working Australia (not by choice but necessity). Sounds like a revolving Gen Y/Z a$$ puckering to me! 

Last but not least, Australia's direct wealth is a result of a mining boom. BS aside don't be fooled otherwise. With the mining boom came the property boom as AUS GDP rockets & people want to flock to a prosperous country.
So what happens when minerals demand from now industrialised countries peters off? Unemployment, smaller GDP, less investment etc. 20 years from now the 'lucky country' won't be so lucky anymore. Can't wait bring it on!!!


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## weird (29 April 2010)

Neutral said:


> The Baby Boomer generation had it easiest regarding housing affordability. Owning a house was a given right relatively speaking. The 'Australian dream'.
> 
> Gen X had it harder as house prices rose and people started the investment property wave.
> 
> ...




Believe it is called a bubble ... waiting to be burst. 

Don't forget, apart from great beaches, we are in the middle of nowhere. About 7 hours flight for most except WA/NT for most of us to get to a central destination ... nothing wrong with that, but we are remote.

I have traveled enough internationally to know we do not have a monopoly on fab and great places to live.

Actually I plan on moving a little bit more central to the rest of the world in about 8 years, but has nothing to do with my love for this country.

But man, seriously as a young person buying in right now ... difficult.


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## Tink (29 April 2010)

I think its funny when people get in these disputes about different generations, Gen X here, but I do agree with Julia, that you cant generalise. 

Opportunities are and were there for all the generations, I think all had to sacrifice if they wanted a home in one way or another.


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## Bushman (29 April 2010)

Tink said:


> I think its funny when people get in these disputes about different generations, Gen X here, but I do agree with Julia, that you cant generalise.
> 
> Opportunities are and were there for all the generations, I think all had to sacrifice if they wanted a home in one way or another.




There is such a lack of empathy between the generations which I find very sad. 

A Boomer will usually get defensive about the opportunity timing and society gave them to accumulate wealth. This opportunity is not available to Gen Y due to the rapid ascent of house prices. 

So the option is to live in a backwater, to become a wage slave to the banks paying out 30-50% of their income to service their mortage or to be a renter for life! 

I am Gen X but still over half my friends do not own a house. Anyone that is not in a fat cat profession cannot afford a house within 30km of the City. 

One day Mr Market (or Mrs Government) will correct this discrepancy.


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## Neutral (29 April 2010)

Tink said:


> I think its funny when people get in these disputes about different generations, Gen X here, but I do agree with Julia, that you cant generalise.




I don't think it's funny. Seems like a sign of ignorance & turning a blind eye. No one can deny the facts, although many cloud over these in favour of their own hypotheticals (fiction).
Do you not have children or want children? What about them? As a parent you always wish better for your children. Unless you have generational wealth to help them get a start nowadays then it's bloody hard, if not impossible.



Tink said:


> Opportunities are and were there for all the generations, I think all had to sacrifice if they wanted a home in one way or another.




I think the 'sacrifice' gap from one generation compared to another is quite large now. You can't compare apples with oranges.

As mentioned before, if your idea of 'life' is slavery (this is what it has now come to) to your wages, bank mortgages and government taxes then this is sad. This is possible for some, but it looks like Beyond Blue will be getting pretty busy in the future.

Just as the 'lucky country' (result of abundant resources geographic to developing nations) was a result of 'lucky times' (demand is still high), does this mean that Baby Boomers became the 'lucky generation' (of affordable housing at 3-5 x the average income)... no? 

There is no government regulation of staples/necessities in this country. Intervention is largely non-existant. 
The goverment know it's coming (the bubble), but by that time present leaders won't be in power so just ride the gravy train while the sauce is still thick. Capitalism at the expense of younger generations sounds like a good plan for the future to me! 

Then we have the wild generalisations that Gen Y show no commitment to employers anymore. Well there's a simple answer for this. If employers can't pay wages relative to ones mortgage then the employee is forced to look elsewhere. This is called survival.


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## Bushman (18 May 2010)

Affordability has worsened and is now heading for record lows! Not sure why they have not added big 4 lending to homeowners in there? Oh yes it is a survey by the CBD building society 


From The Age/HIA CBA survey:

'Housing became less affordable in the first three months of 2010 and may slump to record lows as rising interest rates put further pressure on household budgets. 

The HIA/Commonwealth Bank survey of first-home buyer affordability dropped 4 per cent in the March quarter to its lowest since the September quarter of 2008. The index was almost *29 per cent lower *than for the same period a year earlier, the Housing Industry Association said in a press release.

"Higher interest rates, exorbitant infrastructure charges, an overly restrictive and time consuming planning system continue to fuel Australia's affordability crisis," said HIA senior economist Ben Phillips.'


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## schnootle (18 May 2010)

kgee said:


> Like NZ watch what the brain drain does




This will only become a more serious issue. I think a lot of ambitious people with specialised professions/skills turn their backs on more lucrative jobs in the northern hemisphere and stay in Australia because they love it. But when you can go somewhere else for a better job, earn more and live cheaper........


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## medicowallet (18 May 2010)

Bushman said:


> "Higher interest rates, exorbitant infrastructure charges, an overly restrictive and time consuming planning system continue to fuel Australia's affordability crisis," said HIA senior economist Ben Phillips.'




HIA forgot: Additional gearing, low doc loans and the first homebuyer grant.

These also contribute to the amount that people are prepared to pay for housing, take these out and the price of houses stabilises. The government's solution? Keep increasing them to make houses "more affordable", that is the extent of the intelligence of politicians.


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## Bushman (6 July 2010)

Melbourne is fast emerging as the least affordable destination for first homeowners in Australia. It now takes six-years to save for a deposit on a house and that is for a couple! Home ownership is now more out of reach for Gen Y and Z than ever. The quote I have highlighted says is all really - what is good for the parents with their investment properties is poor for their kids. The imbalance will be rectified as the Baby Boomers start retiring IMO.

Another factor will be a further decline in the birth rate as couples need to work longer and harder to get a foot in the property market, delaying having families until their mid-30s. 

How did it come to this? It is a demographic and political time bomb.


From The Herald Sun'. 

'The second annual Bankwest First Time Home Buyers Report shows a couple in Victoria need to save $86,800 for a deposit to buy the median house and $80,500 to buy a median unit.

There are six local government areas in Victoria - Stonnington (15.3 years), Boroondara (13.5), Port Phillip (12.5), Bayside (11.5), Glen Eira (10.1) and Melbourne City (10)- where it would take an average young couple more than a decade to save for their first house.

Bankwest retail CEO Vittoria Shortt said the study exposed the booming market as a double-edged sword.

"*While it's clearly of enormous benefit to established home owners, it's the complete opposite for many of their children.* Many potential first home buyers are facing long periods in the rental market," Ms Shortt said.'


http://www.heraldsun.com.au/news/re...deposit-for-home/story-e6frf7jo-1225888216134


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## brty (6 July 2010)

Bushman,



> My parents generation (Baby Boomers) were born into a life where employment and home ownership were a given.




From your first post in this thread. Do you have any evidence for that initial assumption?? 

I can assure you that my first property was anything but a given. You had to save a large deposit, have a savings record with the bank, could only count the husbands income, and the bank manager had to like you. Not to mention high interest rates of over 12%.

Yes it is so hard today compared to the good old days..

brty


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## Bushman (6 July 2010)

brty said:


> Bushman,
> 
> 
> 
> From your first post in this thread. Do you have any evidence for that initial assumption??




Yep my life experience to date and that of my peer group (family, colleagues, friends, dudes on the internet). We are, after all, the sum part of our experiences. 

While interest rates are not 12%, the median house price as a % to income has never been higher and the willingness of banks to lend to the plebs has never been lower, IMO. 

At least in the good old days you had a level playing field. How else do you explain how Australian median house price rose despite the GFC?


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## Huitzii (6 July 2010)

Bushman said:


> Yep my life experience to date and that of my peer group (family, colleagues, friends, dudes on the internet). We are, after all, the sum part of our experiences.
> 
> While interest rates are not 12%, the median house price as a % to income has never been higher and the willingness of banks to lend to the plebs has never been lower, IMO.
> 
> At least in the good old days you had a level playing field. How else do you explain how Australian median house price rose despite the GFC?




Yep it was easy for me in 1978 I was earning $76 a week as a first year apprentice bricklayer.
I struggled but bought my first house in 1982 for $58000
From then on ive bought in and out of realestate to eventually own my home that im in now and its all mine.
Not to mention the highest interest rates this country has ever seen in the mid 1980's....it was just so easy for me while i worked in my own businesses for 80 hours+ per week, and its so easy for others to say how lucky I am.
The problem these days is the younger generation  want to run before they can walk, I lived in a caravan for years while I saved every dollar that I could.
Ive busted my butt to get where I am son as you will have to do the same.
Have fun as ive already done the hard yards


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## Bushman (6 July 2010)

My intention for this thread is to highlight what I perceive to be an inequity in modern Australian society rather than blight anyone's own personal experience. 

On a personal disclosure note, I have worked full-time for about 12 years and, through personal circumstance, own my house outright. I have worked hard and have been lucky. Good for me.  

Yet I see friends of mine in their 30s only able to enter the housing market now and at LVRs which would make a grown man cry. Statistics in the media suggest this is an issue across Australian society to date for certain demographics (i.e. those under 35). This makes me very angry at the substantial obstacles being thrown in their way to have what their parents had at an earlier age and with a greater financial return. It is no longer a level playing field and this must change. 

I have no doubt that previous generations worked hard; my argument is the 'effort-to-assets' ratio if you like is lower now than it has ever been for a variety of issues raised throughout this thread. Thus, hopefully through threads like this, various governments (local, state, feds) will act to return the housing market to a level playing field. 

I am sure that there are others that disagree with my views and I am impressed with some of the personal stories shared.


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## Huitzii (6 July 2010)

I can respect what you are saying Bushman but I think that the amount of weeks pay needed to purchace a house back in the early 80s would be approximatly the same now.
ATM I dont have time to do any real comparisons but I might do it tonight.
My advise to the younger generation is "WORK HARD AND BE GOOD TO YOUR MOTHER"


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## Bushman (6 July 2010)

Huitzii said:


> My advise to the younger generation is "WORK HARD AND BE GOOD TO YOUR MOTHER"




Excellent advice H


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## prawn_86 (6 July 2010)

Huitzii said:


> I can respect what you are saying Bushman but I think that the amount of weeks pay needed to purchace a house back in the early 80s would be approximatly the same now.
> ATM I dont have time to do any real comparisons but I might do it tonight.
> My advise to the younger generation is "WORK HARD AND BE GOOD TO YOUR MOTHER"




I dont have data in front of me either, but average house price used to be 3 -5 times average wage, now it is 7 - 10, so either house prices have risen a lot, wages have stagnated, or a combination of both


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## Bigukraine (6 July 2010)

Bushman said:


> My intention for this thread is to highlight what I perceive to be an inequity in modern Australian society rather than blight anyone's own personal experience.
> 
> On a personal disclosure note, I have worked full-time for about 12 years and, through personal circumstance, own my house outright. I have worked hard and have been lucky. Good for me.
> 
> ...




well thought out and presented ,well done Bushman and i would like to put the focus on one of the elements of your comment's and that is the "luck" part.
The main thing in any type of investment is the risk factor associated with that investment eg money in the bank garenteed by govt to the other end of the spectrum ,shares in a minnow exploration company on the asx. (examples only) . The thing i find hard to contemplate is that people seem to not want to understand or aknowlage that there are winners and lossers when it comes to profit making and at times the most ethical and honest people who are hard working don't seem to be able to go forward... they save hard to try to get ahead and as you pointed out now is alot harder to be on the path to owning your own home than it was 40 years ago.
Had this same discussion with the inlaws and as always each generation thinks they had it harder.... after many hard years of work and having to get a second mortgage(bridge finance) he bought his own home and being the main bread winner put money in his super and had it matched $1 for$1 bought up two kids during this time and yes did it on a shoe string... lucky for him he retired 20 odd years ago and his super gave him a resonable retirement.
The point of what i have written above is the average person is like my father inlaw and that same person now with the same values would not have a hope in hell of being in his position in this day and age..... super keeps changing the goal posts, wastefull govt spending,GFC, prop up of the realestate industry through the fhog..... i would hate to be your friends at 30-35 now....
Like you i'm ok financially no millionare but on the way to being comfortable, but i feel for people under my age (42) the 25-35 group with the enf. on higher education ,hex fee's ,living at home longer ,stricter lvr's GFC II and poss III..... in my opinion they don't stand a hope in hell... as i said in the begining you can make good choices ,but through no fault of your own you can be in the wrong place at the wrong time...... so in conclusion if you don't have this your stuffed ............LUCK.


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## Knobby22 (6 July 2010)

Bigukraine said:


> Like you i'm ok financially no millionare but on the way to being comfortable, but i feel for people under my age (42) the 25-35 group with the enf. on higher education ,hex fee's ,living at home longer ,stricter lvr's GFC II and poss III..... in my opinion they don't stand a hope in hell... as i said in the begining you can make good choices ,but through no fault of your own you can be in the wrong place at the wrong time...... so in conclusion if you don't have this your stuffed ............LUCK.




They do have an option and that is to be politically active.
Form a pressure group. Attack the government through the media.
Show the actions of vested groups. Educate the people in their generation that they are having their future stolen. Influence voting!

Who has the most influence now? It is not them though they make up a substantial proportion of society.


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## Bigukraine (6 July 2010)

Knobby22 said:


> They do have an option and that is to be politically active.
> Form a pressure group. Attack the government through the media.
> Show the actions of vested groups. Educate the people in their generation that they are having their future stolen. Influence voting!
> 
> Who has the most influence now? It is not them though they make up a substantial proportion of society.




I agree but politically the lucky country is also the lazy country...i would love to see what you are suggesting ... how much further can the people of australia be pushed.... the answer to that is when they do what you have said stand up and be counted..... one person all be it in a simplistic and naive way tried to already pauline h .....  and the question has to be asked.. would she of done as much damage as the last two govts????? would we of been any worse off ?????


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## Bushman (19 August 2010)

Latest HIA/CBA index has shown that housing affordability has worsened once again by 9% in the June quarter! 

Frighteningly, the proportion of average income in capital cities devoted to monthly home loan repayments is near 30% which is the level officially defined as 'mortgage stress'. Worth thinking about. 

There has never been a worse time to be a potential buyer or a renter! 

Think about it, the great Boomer Aussie home ownership dream is becoming a cultural relic for those aged below 35. 

Unsustainable, yet not a peep this election. Lol.


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## prawn_86 (19 August 2010)

Bushman said:


> There has never been a worse time to be a potential buyer or a renter!




I dont think its a bad time to be a renter, you can rent quality places at well below what it would cost to pay the interest of a mortage off the same property. Providing you save the difference then its great


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## choice1 (19 August 2010)

To be honest I'm not too fussed with owning a house as they are, on average, a fairly poor investment compared to business. Compare continuously investing in blue chip industrials at the same rate as you would your mortgage minus rent from the date of your house purchase. Not only would you have a much larger capital base but your investment would have paid off many times over.

Anyway given that you can't hold a hold term lease in Australia it pretty much forces people to buy a house purely for lifestyle purposes. Give me a 10 year house lease + excess funds into businesses over owning a piece of property any day.

Why own the land that businesses/employees of businesses rent when you can own the business that makes the profit from the land?

EDIT: 







> Unsustainable, yet not a peep this election. Lol.



40 billion spending here, 40 there... interest rates on the rise as the RBA tries to cool the economy off. Large numbers of over leveraged Australians buying into a bubble with the FHBG incentive. This sounds like a recipe for disaster and could see the housing bubble pop in the next 5-10 years. Hopefully by then my savings will be large enough, given the 12% interest rate I will be receiving, to buy a property out right and move to the country to trade on my FTTH broadband connection : )


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## Bushman (1 June 2011)

Coalition is all over housing affordability now. Housing afforability along with the cost of living will be Abbot's ticket next election as he tries to recruit a new generation of Howard's battlers. 

The Age today, quote by Joe Hockey. 

'Australia is suffering from a housing affordability crisis because of rising interest rates and uncertainty surrounding the Gillard government's planned carbon tax, the opposition says.'


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## Logique (1 June 2011)

Some key factors in the historical timeline of housing affordability:

- transitioned to two working adults per family.
- lots of 'working family' type government handouts to bolster the bottom line.
- foreign investment.
- but nobody wants to live in the regions (still, except in a few hotspots), especially health care professionals.


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