Australia's Housing Affordability Crisis

squeeze on 16/04/2023 - 23:02

The average income in Australia is 92K pre-tax. This equates to around 4.7K monthly take-home. To buy an apartment in a desirable suburb in Sydney or Melbourne you are looking at spending AT LEAST $600,000 for something small but liveable (2 bedrooms if you're lucky). The monthly repayments assuming a 500K loan (assuming you have saved 100k deposit) is 3.4K over 30 years (7% interest rate). This leaves 1.3K leftover for body corp fees, car expenses, holidays, food, utilities and life which is not enough to live comfortably.

In other words for a single person to buy their first home without the bank of mum and dad it's really not achievable without making big sacrifices. I wonder where this will leave a generation of low income earners who never make it into the market.

What can be done to address this and get first home buyers / young people into the market?

Personally I think there should be more tax on property investors and restrictions on foreign property investment. In other words - more owner occupied homes. I am interested to see what Labor do with the first home buyer shared equity scheme.

An interesting watch from Friendly Jordies on the housing affordability crisis - https://www.youtube.com/watch?v=lJE3B_ra3lY&ab_channel=frien…

Financial

Comments

- - - - OzHan on 17/04/2023 - 12:19
        
        +2
        
        @techlead: Incentives/loopholes will already exist in different shapes or forms. name me one country which does not have these loopholes. I don't live in NSW and don't think I'll ever able to afford to live there. but If I really had to for various reasons I'd start small and build my equity and work gradually towards the $1.2 mil as mentioned, To get on the first rung of the ladder you don't need to spend $1.2 mil.
      - Bargainitis on 17/04/2023 - 15:06
        
        +1
        
        @techlead: some off the cuff comments…
        
        1) median house price in NSW continued to rise as its arguably the most popular city to live in Australia. Certain pockets of Sydney are very sought after and supply is limited. Like I said, if you look at greater Sydney, the prices are more economical. Again, people can live there. The commute is longer but entry price is there.
        
        What is your solution here? somehow "even" out the pricing so that Vaucluse is similar to Leppington (sorry Leppington) so more people can afford it? or somehow revert prices back to 2003 so its technically "more affordable" for you?
        
        For the former, it is in no interest for the wealthy to ever allow sought after areas to be leveled. We dont live in a socialist world (and frankly thats failed on multiple fronts as we all know, humans are greedy). For the latter, no home owner would ever want to see a signifcant pull back in the property prices - hey, for obvious reasons.
        
        2) My assessment? I think the middle class has gotten wealthier and have been able to stretch and buy more expensive property, driving up the median price. Its not really the wealthy that is your enemy. They live in pockets of affluent areas where its always been expensive and there they will stay.
        
        I think the reality now is $100K p.a. salary doesnt get your far and its obvious but I keep going back to what I was saying which is we all have to live within our means. Life isn't fair and it will never be.
        
        techlead on 18/04/2023 - 10:53
        
        @Bargainitis:
        
        median house price in NSW continued to rise as its arguably the most popular city to live in Australia.
        
        Cannot argue with that, I live in Sydney, can't imagine living somewhere else. I considered moving to a crypto haven for a year to avoid paying CGT because it was quite significant (the amount I sent to the ATO can purchase nearly all properties in Sydney outright, except for the trophy/luxury mansions).
        
        The commute is longer but entry price is there.
        
        Commute is not an issue anymore, I'm only going 1-2 days into the office, rest I work remotely. I will never go back to the office 5 days a week again, if the company tries to force me (unlikely), I will just quit and retire. I will take it as a sign from the universe telling me to retire.
        
        What is your solution here? somehow "even" out the pricing so that Vaucluse is similar to Leppington (sorry Leppington) so more people can afford it?
        
        Not at all. The property market has been pumped up way beyond fundamental value due to the incentives in our tax system which is fueling rampant speculation/gambling. Just eliminate that, abolish negative gearing, tighten up rules around converting properties from investment to primary residence to get the CGT exemption, and other ways to curb demand for rampant speculation/gambling in property. Go back to the principle that housing is for shelter, not speculation/gambling.
        
        somehow revert prices back to 2003 so its technically "more affordable" for you
        
        That's absurd, I've not heard of anyone suggesting this until now lmao
        
        I think the reality now is $100K p.a. salary doesnt get your far
        
        1000% agree, I reckon $200k is the new $100k now with all the inflation. I'm on well over $200k and I'm feeling the effects of inflation. I wouldn't consider myself wealth if I didn't have my crypto portfolio.
        
        Life isn't fair and it will never be.
        
        That's very true.
        
        Bargainitis on 18/04/2023 - 13:48
        
        @techlead: lol….okay
        
        The long play for a flex in the end :D
        
        techlead on 18/04/2023 - 14:16
        
        @Bargainitis: You are the one who made it personal, so I might as well flex. I don't need prices to "revert..back to 2003", I can easily afford a house at today's price, I was just speaking more generally and also modelling out where this will lead to, as its becoming a bigger and bigger issue. I doubt I will live to see the consequences either way.
        
        I think, at some point, something is going to break, either we will have society breaking down or we will have some kind of paradigm shift that will change the property market forever.
        
        Look at Hong Kong as an example of society breaking down, you have people living in cage rooms, and tiny two bedroom shoe box apartments becoming 8-10 room apartments. Have a watch of this, its eye opening, https://www.youtube.com/watch?v=hLrFyjGZ9NU.
        
        Or we see a crash in the property market, like in Japan and it never recovers. Like what's happening in China.
        
        A huge issue with property being such a big part of the economy is that its going to be a drag on other sectors of the economy. Look at China, property is 2/3 of its economy, therefore consumption is very very low, as people spend most of their money on property, they don't have much left to buy other things. Do you want Australia to become such a society?
        
        Bargainitis on 18/04/2023 - 14:32
        
        @techlead: My comment was a bit tongue in cheek hence the smiley at the end but I guess it drew out your true intention behind your post…. lol
        
        Not sure where in my messages I made it personal though? I simply asked what a solution might be and threw out two throwaway scenarios - obviously neither are realistic or practical in nature. You read a bit too much into that if thats where you drew personal offence.
        
        Separately though, China is a different beast, it needs growth and its effectively propped up by BS right now. They tried plugging it with property but that's turned as the demand isn't even there, there are cracks all over China's economy especially now that businesses have shifted some weighting to Thailand, Vietnam, etc. I wouldn't use them as a comparable.
        
        I do agree that the historical growth rates in Australia can't be sustainable forever but as long as we are net migration increasing, the demand for sought after property will always be there. You think that 600 sqm block in Point Piper off the waters won't be $30 to 40m in 2040? Unless there is uprising and our government falls apart, I got money it will be.
        
        Anyway, my post was not about a pissing contest - simply sharing my views. Happy to compare d1ck sizes if you want though? :D
inherentchoice on 17/04/2023 - 10:06

+1

Supply and demand. There needs to be plenty of additional supply coming online.

But there's too many barriers and costs for mass development of cheap housing. Too much government red tape and green tape and bureaucracy. Too many planning restrictions and laws and height limits and developer contributions to be paid to local and State government. Also a lot of barriers for new developers to enter the market. Plus there's incentive for existing developers to stretch out their land supply into the future to keep prices high. A bit like what OPEC does with oil supply and prices.

Now it's got to the current stage, the risk is the market is coming down and people aren't buying because of that risk… so that will also discourage new development.
- brendanm on 17/04/2023 - 10:16
  
  Too much government red tape and green tape and bureaucracy. Too many planning restrictions and laws and height limits
  
  Yeah, they should just let developers do whatever they want, 500 stories high, townhouses 2m wide, cut down every tree in sight. Go for it, who gives a shit about the environment or anyone else that also has to live there, as long as the developers make money.
  - Bargainitis on 17/04/2023 - 10:38
    
    exactly! people just think you can build anywhere without compromising. its not that easy. Sure, blame the local council, blame developers, its all their fault.
    
    The solution is already there, lots of new builds on the outskirts of sydney — greater sydney is getting bigger and bigger to try to fulfil the demand. BUT, people don't want to live there….oh its so far… its not great area. I want to be in Potts Point, Mosman!!! house crisis! affordability issue!
    
    Face the reality. Either make more money or accept your fate.
  - Donaldhump on 17/04/2023 - 11:14
    
    +1
    
    yet i own two acres, cant cut down 40m tall trees 11m from house, cant even put an awning up without a fricken building approval, can hardly scratch my ass without an approval, and yet have to pay for this privilege of being told what i can do on the land i own. then they can just declare it a flood zone despite never flooding, so can no longer build a shed, or a pool, or a gazebo incase i get distracted and drown during the biblical scale flood, yet the same gov can allow developers to raise land near by lower than my height and build a ghetto of houses which drain straight into the rover and creeks.
    
    all of it is a ballache, when does someone actually own their place.
    
    local gov do very little of value to the people that are forced to pay their wages.
    
    oh now i have a noxious weed in my dam and must get rid of it, but council cant really help with this
  - inherentchoice on 17/04/2023 - 11:55
    
    +1
    
    Your comment helps to demonstrate that it's not exactly the government, but all the voters. Environmentalists and people rusted-on to their neighbourhood and opposing nearly any and every change or development like 'grumpy old men'.
    
    So unaffordable housing is actually what the majority votes for and proactively advocates, even to the point of joining extinction rebellion and blocking up all the peak hour traffic.
    - brendanm on 17/04/2023 - 12:54
      
      Environmentalists and people rusted-on to their neighbourhood and opposing nearly any and every change or development like 'grumpy old men'.
      
      Haha, yeah f the local flora and fauna right? Just concrete the whole country, we don't need any of the trees or animals, overrated. Just cram in more "skilled migrants" and watch that GDP go up. you may be happy to live in a 3x3m slum, but not everyone is. If that's what you want, go do it away from people who don't want that.
      - inherentchoice on 17/04/2023 - 13:41
        
        -1
        
        @brendanm: And you want unaffordable housing instead. Okay, well, you got it.
        
        brendanm on 17/04/2023 - 13:48
        
        +1
        
        @inherentchoice: I purchased a house that was affordable for me. It wasn't a "desirable suburb" at the time. I wasn't earning a great amount at the time, had one kid and another on the way. Sold pretty much every "toy" or hobby related thing I owned, and did side work to get a deposit. Short term pain, long term gain, which is what no one wants to do, they all want a 4 bed home in a perfect suburb for $300k, and still be able to buy 20 iPhones a year and Gucci shirts.
        
        inherentchoice on 17/04/2023 - 13:53
        
        -1
        
        @brendanm: That "pain" is the price for our society's environmentalism, bureaucracy, big government and anti-development sentiment. But the price and burden is set to become only bigger and bigger. Along with all the inflation. It is surely the opposite of sustainable, unless something else breaks the trend somehow.
        
        brendanm on 17/04/2023 - 14:59
        
        @inherentchoice: No, that "pain" is life. Everyone isn't automatically deserving of getting the exact thing they want for the price they can afford. I'd rather pay more, and have the environment protected, and developers properly controlled. Government should stop the constant importation of people.
        
        inherentchoice on 17/04/2023 - 15:10
        
        @brendanm: You're proving my point. This is the majority view that the majority vote for, at least in terms of the environment.
        
        brendanm on 17/04/2023 - 15:17
        
        @inherentchoice: Yeah, and? Most people would rather protect the environment than concrete the entire country so we can import millions of people and live in slums? Hardly a revelation.
        
        inherentchoice on 17/04/2023 - 15:25
        
        @brendanm:
        
        Everyone isn't automatically deserving of getting the exact thing they want for the price they can afford.
        
        Agreed. And if the cost for the majority 'environmentalist' view comes at the price of unsustainable financial crises and people going homeless and hungry, then this is what you are all promoting and voting for.
        
        But this is their objective. To destroy society but hug the trees is to "save the planet". Humans and "overpopulation" are an enemy. Nature must be elevated and worshiped above all, even above God. And the majority simply goes along blindly with this groupthink.
        
        brendanm on 17/04/2023 - 15:44
        
        @inherentchoice: You realise we are part of the environment? It all works together.
        
        Overpopulation is the enemy, why do we need endless people at the expense of everything else? I don't believe in god sorry.
        
        inherentchoice on 17/04/2023 - 15:46
        
        @brendanm: And do you have any convincing or compelling evidence for this opinion or belief? What is your BEST evidence? Or are you merely going along blindly with groupthink?
        
        brendanm on 17/04/2023 - 16:18
        
        @inherentchoice: Most people don't think overpopulation is a problem, so not sure how the opposite would be group think. The evidence is that there is only so much arable land, and only so many resources to go round. Look at all the people starving around the world, while continuing to pop out kids destined to die of disease or famine. It's disgusting
        
        inherentchoice on 17/04/2023 - 16:31
        
        -1
        
        @brendanm: Starving people and limited arable land. That's your best evidence? And are you also conveniently ignoring to provide any evidence for your belief about God?
        
        Nevermind that the world is actually mostly empty of humans at present? There is also nearly unlimited potential for fresh water (oceans) for farming the deserts, and there's also no shortage of energy. Peak oil has been forecast to hit decades ago and is just another dud prediction of the doom-and-gloom environmental alarmists.
        
        PS: Groupthink can be from any group.
        
        brendanm on 17/04/2023 - 16:35
        
        +1
        
        @inherentchoice:
        
        And are you also conveniently ignoring to provide any evidence for your belief about God?
        
        What? There is zero evidence that any god exists, therefore I don't believe in one.
        
        Nevermind that the world is actually mostly empty of humans at present?
        
        Haha, lots of land is literally uninhabitable. Though feel free to go live in a desert, or out on the ocean if you like. Even if it were inhabitable, why do we have to infest every inch of it with people? Seems daft.
        
        There is also nearly unlimited potential for fresh water (oceans)
        
        Oceans are salt water. Fresh water isn't fresh once it's polluted. I think you need to do a bit of research into things mate.
        
        Peak oil has been forecast to hit decades ago and is just another dud prediction of the doom-and-gloom environmental alarmists.
        
        I don't care about oil. I care about overpopulation, over forestation, humans causing animals to go extinct, simply because we can't stop popping out more humans than is necessary.
        
        inherentchoice on 17/04/2023 - 16:40
        
        -1
        
        @brendanm: You say zero evidence for God and yet you provide zero to disprove? And yet every single time you read and write the date it points to Immanuel, God himself, does it not? Do you need more evidence than him rising from the dead, or can you disprove that at all?
        
        I think you are proving my point about blindly going along with the groupthink preached to us by media and academia. Unless you do have some convincing or compelling evidence?
        
        Unlimited potential for fresh water, but mostly depending on energy. But just look at our sun and it's essentially unlimited energy for trillions and trillions of humans.
        
        brendanm on 17/04/2023 - 16:45
        
        +1
        
        @inherentchoice:
        
        You say zero evidence for God and yet you provide zero to disprove?
        
        Hahaha, well, this has made my afternoon, how amusing. That's not how proof works mate, you have to prove that something exists, not that it doesn't exist.
        
        I have a purple, 3 headed dragon that speaks to me every day and tells me what to do, prove me wrong.
        
        But just look at our sun and it's essentially unlimited energy for trillions and trillions of humans.
        
        Ok, looks like I'm having a conversation with a lunatic, I'm out.
        
        inherentchoice on 17/04/2023 - 16:50
        
        -1
        
        @brendanm: It seems your BEST evidence so far is about limited arable land.
        
        On the other hand, I have given you resurrection from death itself and a date which you perhaps have blindly and willfully ignored every day. And there is of course nearly infinitely other irrefutable evidence.
        
        But tell me when you have anything else even remotely compelling for your position. Or perhaps your argument is merely about concreting the whole of Australia and a purple dragon.
        
        brendanm on 17/04/2023 - 16:56
        
        @inherentchoice:
        
        On the other hand, I have given you resurrection from death itself and a date which you perhaps have blindly and willfully ignored every day. And there is of course nearly infinitely other irrefutable evidence.
        
        😂
        
        Do you just wilfully ignore the irrefutable evidence the other religions all have?
        
        inherentchoice on 17/04/2023 - 17:03
        
        @brendanm: If you think he is a joke or not real, and have no evidence, then you disagree with even the secular historians. The genealogy and history is plain to see despite millennia of attempts to disprove it.
        
        I put it to you that you believe in a green religion that worships trees and nature, and your best evidence is a literally fabricated skeleton fashioned out of bronze by a human sculptor. This idol is called Lucy and the masses worship it on a pedestal in the Smithsonian. Or please correct me if this is untrue or if there is some better or other irrefutable evidence for your religion.
        
        brendanm on 17/04/2023 - 17:24
        
        @inherentchoice: You are talking literal nonsense.
        
        inherentchoice on 17/04/2023 - 20:30
        
        @brendanm: Then prove it. What is your best evidence? And yet you deliberately ignore this issue and your lack of even a single piece of convincing evidence.
        
        All hail fabricated Lucy the best evidence for the green religion… which causes homelessness and poverty and the housing crisis.
        
        https://humanorigins.si.edu/evidence/human-fossils/fossils/a…
        
        brendanm on 17/04/2023 - 20:31
        
        @inherentchoice: I don't know what you are harping on about, and have no idea who or what Lucy is.
        
        inherentchoice on 17/04/2023 - 20:40
        
        @brendanm: I have asked you for evidence for your green religion. You offer none. With no evidence that is called blind faith. Why didn't you click the link I just gave you to see the fabricated idol of Lucy which you are truly worshipping? Why do you put your faith in that? Or if not then what is the BEST evidence for your choice to worship nature and to reject your own creator God?
        
        brendanm on 17/04/2023 - 20:55
        
        @inherentchoice: I don't have a green religion. I don't have a religion full stop. Just because you have a religion does not mean everyone does.
        
        I'm not clicking the link because I don't even care enough to do that.
        
        inherentchoice on 17/04/2023 - 21:02
        
        @brendanm: Yet your green faith is your basis for promoting homelessness, poverty, starvation and the housing crisis. And you are in denial about continuing to follow it blindly, with no evidence to prove otherwise, that you would even refuse to consider if you are practising idolatry toward fabricated bronze and plastic skeletons.
        
        That is surely the height of lunacy, especially for something with potentially grave eternal consequences.
        
        brendanm on 17/04/2023 - 21:11
        
        @inherentchoice: I don't have green faith, I honestly have no idea what you are going on about, have a good night, seeya.
        
        inherentchoice on 17/04/2023 - 21:25
        
        -1
        
        @brendanm: The evidence will keep on crying out against you, including whenever you read or write the date. Every. Single. Time.
        
        twjr on 18/04/2023 - 01:08
        
        @brendanm: I know it was a courtesy but you really don't need to be apologising for someone else's delusions, especially given the lunacy that comes next.
        
        DrScavenger on 17/04/2023 - 17:28
        
        @brendanm: You are so tone deaf it's funny.
        
        brendanm on 17/04/2023 - 17:29
        
        @DrScavenger: Solid argument, good points.
        
        DrScavenger on 17/04/2023 - 17:35
        
        @brendanm: You need to be totally ignorant if you cannot see that you need sacrifice a lot more to have a house now than you had to 40 years ago.
        
        You need to be totally selfish if you believe current development laws are sustainable for new people.
        
        You need to be benefitting from the system if you cannot see how ridiculously strong local governments/legislations are for the land you "own". A cushy job in your local region, maybe.
        
        You need to be ignorant if you cannot see that countries like Australia rely on a constant stream of migration.
        
        You must have never visited countries in western/southern Europe like Portugal to never realise you can have decent development and livable cities at the same time.
        
        Epitome of "screw you, I got mine"
        
        brendanm on 17/04/2023 - 17:43
        
        @DrScavenger: I bought 5 years ago. I sacrificed to do so. Others don't want to do this, that's their choice, doesn't mean slums should be pushed onto others.
        
        If you want to live in a Soviet bloc apartment, go ahead?
        
        You need to be ignorant if you cannot see that countries like Australia rely on a constant stream of migration.
        
        Only to increase GDP and control wages.
        
        I can see you are a bit upset, perhaps take a minute to calm down, and have a think. You may come to the realisation that if you didn't want to live in a top 10 suburb in a 300m2 house, you too could buy something. Instead, you want to make zero sacrifice, and have everything.
        
        DrScavenger on 17/04/2023 - 17:56
        
        -1
        
        @brendanm: People in Lisbon aren't living in slums. You are just pointing extremes to whitewash your desire of unaffordable housing so your property doesn't lose value. Nobody is advocating for commie blocks.
        
        And nobody is forcing you to live in an apartment but if I want to "live in commie blocks" in your precious neighbourhood then let me, it's my decision.
        
        No. Australia's fertility rates are simply unsustainable, just like other developed countries. Do you want to work until you die with reduced social benefits or do you want some immigration? Despite this little immigration everything is so expensive. Just go look at tradie rates.
        
        How tf do you even know me? You are just picturing some imaginative "lazy youngster" and fighting that instead. Perhaps try to understand us rather than screwing future generations?
        
        brendanm on 17/04/2023 - 18:37
        
        +2
        
        @DrScavenger:
        
        People in Lisbon aren't living in slums.
        
        Not sure what portugal has to do with Australia.
        
        You are just pointing extremes to whitewash your desire of unaffordable housing so your property doesn't lose value
        
        I bought my house to live in. There is plenty of affordable housing around, it's just that people don't want it as it's below them.
        
        but if I want to "live in commie blocks" in your precious neighbourhood then let me, it's my decision.
        
        No, it's actually not. I don't want to live around Soviet bloc apartments, so chose somewhere that they are not. You can have them elsewhere.
        
        No. Australia's fertility rates are simply unsustainable, just like other developed countries.
        
        If we weren't importing endless people, forcing lower wages, people might be able to afford to have kids.
        
        Do you want to work until you die with reduced social benefits or do you want some immigration?
        
        My house will be paid off well before I finish working, I have superannuation, as well as cash. I won't be working anywhere near until I die. Also don't need social benefits.
        
        I also have no problem with some immigration, just not the amount we are ramping up to.
        
        everything is so expensive
        
        Weird, almost like they shut off immigration for a few years, and threw money at everyone in sight like it was going out of fashion.
        
        How tf do you even know me? You are just picturing some imaginative "lazy youngster" and fighting that instead. Perhaps try to understand us rather than screwing future generations?
        
        I'm probably the same generation than you, it's just I actually got up and did something rather than sitting back and crying.
        
        mavis30551 on 17/04/2023 - 15:47
        
        @brendanm: people are still sacrificing to own homes, get off your high horse.
        
        brendanm on 17/04/2023 - 16:14
        
        @mavis30551: Yeah, the ones that are buying. I'm talking about the ones that just whinge that they can't have every single thing they want.
        
        tonka on 17/04/2023 - 18:06
        
        @inherentchoice: 'you want unaffordable housing instead', I can point you towards some affordable housing where everything is concreted over and is just noise and people. That's the point, the renting crisis exists in desirable areas with 'lifestyle' options like parks etc.
- OzHan on 17/04/2023 - 12:59
  
  Simply ask yourself, Do you want your nice house or suburb to be surrounded or filled with mass development of cheap housing? Do you want the gov to remove all planning restrictions and laws and height limits to allow that to happen anywhere.
  - inherentchoice on 17/04/2023 - 13:43
    
    Appealing to extremes is a logical fallacy. There simply needs to be more supply and therefore less restrictions. But if everyone says "not in my neighbourhood" then it just doesn't happen anywhere.
    - brendanm on 17/04/2023 - 15:22
      
      But if everyone says "not in my neighbourhood" then it just doesn't happen anywhere.
      
      Some people have sacrificed and worked hard for what they have, why would they want their neighbourhood turned into a slum because others can't do this.
- freefall101 on 17/04/2023 - 14:34
  
  IMO we just need consistent regulation. Why there isn't a national body there looking after this is beyond me, instead every local council gets to make up their own hodgepodge of rules, takes bribes from developers (although that happens all through government) and it's a joke. We regulate the hell out of super and it's a third of the size of housing in terms of value.
  
  A proper regulator could do a lot of good. Consistent rules nationally, "use it or lose it" rules for land developers, properly thought out land releases based on infrastructure and density not based on rich areas vs poor would fix most of hte problems.
  
  Granted, we still have a construction problem too. Unfinished builds are at record highs, new starts have dropped and it's generally due to price and materials.
Vulgar on 17/04/2023 - 10:27

+1

Two things: Increase supply and lower demand.

Increasing supply is the better long-term play. This can be done by relaxing zoning rules, allowing for higher desnity dwellings to be built anywhere.

To decrease demand, you could just restrict foreginers from buying homes and also keep interest rates high to increase the interest cost of a mortgage.
Dack Smith on 17/04/2023 - 11:08

Did you know our PM makes $115,000 every year from all his various investment properties?
- techlead on 17/04/2023 - 11:30
  
  +7
  
  Yes, one of his tenants endorsed him and gave a glowing interview for a puff piece about Albo.
  
  What's your point? I don't see any issues, and from his tenant's accounts, he's a good landlord, not raising rents to market and giving them extra help during the pandemic by dropping the rent.
  
  Can you imagine someone from the Liberal/National party doing this?
- ThithLord on 17/04/2023 - 15:32
  
  +9
  
  The PM owns two residential properties and one investment property. One home in Marickville that he's been living in up until becoming PM. And another property being an investment property that he's owned for many years and is still paying off (mortgage is on register of interests).
  
  No family trusts to hide this in, no holding companies, no directorships; it's all above board.
  
  He doesn't hide the fact that he owns property. Openly admits to it.
  
  I guess you're extremely concerned about Peter Dutton, whom in the last 30yr has partly owned or sold over 21 properties. The "self-made" Dutton, handed a directorship pf the family trust at the age of 22.
- Embaloo on 17/04/2023 - 20:11
  
  Just from his properties? :o
  Where did you read this?
Donaldhump on 17/04/2023 - 11:09

-1

people living on their own without a partner or flatmate, should get a single supplement / higher tax free threshold maybe

i always think tax should be done at a couple level to allowing one to split with the other, abolish childcare rebates, have a parent actually stay at home. Those couple that chose to both work pay for childcare. I think its sad people have to go back to work when their kids are 6 weeks old.
bobolo on 17/04/2023 - 11:12

+3

I have personally experienced a significant wealth jump in the past 10 years

My dream home 10 years ago was $3m in the Ryde area

My dream home now is a $15m home in the lower north shore area

It never ends - just be happy where you are. Live within your means all the time - even if you are rich as f**k, and upgrade your home as you go through life/hopefully earn more income/wealth
- techlead on 17/04/2023 - 11:27
  
  -5
  
  I have personally experienced a significant wealth jump in the past 10 years
  
  So have I, but not with property, I rode the Bitcoin rocket.
  
  The issue for most people is that they can't even get on the first rung of the ladder.
  - bobolo on 17/04/2023 - 12:08
    
    +3
    
    Yes they can
    
    Just compromise
    
    I started in Western Sydney in a 60 year old walk up unit. Current value is worth around the $550k mark. Doable for any lower income earner. Else just do a 1 bedder
    
    Or just rent while you spend your capital to make more money?
    
    Plenty of ways to do it - its all down to attitude
    - tonka on 18/04/2023 - 15:49
      
      Yep, it's a long game building wealth. I think my current recommendation would be find a house on a big block on the outskirts of a regional city. Then rent where ever works for your lifestyle. Houseshare as long as you can ideally where someone else is providing furniture, managing bills elc.
techlead on 17/04/2023 - 11:21

-5

Here's a potential silver bullet for ya, I doubt it will ever be implemented though.

All housing policy should be designed with the following principle, Housing is for shelter, not gambling/speculation.

Change the deposit requirements for residential property to the following:

20% for the first property
50% for the second property
95% for the third and all subsequent properties

Probably need to tweak it to make it fair for couples, otherwise we will see a wave of fake divorces, however even if we don't tweak it for couples, this change alone will be enough to take the crazy demand off of property and eliminate most of the gambling/speculation.

People with multiple properties already are grandfathered in, it doesn't matter, property prices will plummet after this is implemented, it will go back to fundamentals.
- deme on 17/04/2023 - 11:33
  
  +1
  
  Here's a potential silver bullet for ya, I doubt it will ever be implemented though.
  
  Go back to shitcoins.
  
  The simple solution is remove negative gearing and the 50% discount on CGT for property.
  Done
  - techlead on 17/04/2023 - 11:35
    
    Go back to shitcoins.
    
    I don't like shitcoins, I invest in Bitcoin and good quality alts
    
    The simple solution is remove negative gearing and the 50% discount on CGT for property.
    
    Totally agree with that, Shorten took that to the 2019 election and got defeated. We should be abolishing all those incentives in the system for people to buy and hold multiple properties. Its like having a loose monetary policy during the boom times, inflation crazy and go and cut interest rates to add fuel to the fire, its not gonna end well.
    - helpme on 17/04/2023 - 14:40
      
      (Genuine questions) Can you tell me where you see the value in Bitcoin? What makes it superior to other coins and what makes it a good crypto currency? Why should someone pay 40k for one?
      - askbargain on 17/04/2023 - 17:18
        
        @helpme: https://www.youtube.com/watch?v=YIVAluSL9SU
        
        helpme on 17/04/2023 - 20:57
        
        @askbargain: That's such a general video though that I thought has been somewhat debunked with Bitcoin being inefficient and costly even compared with visa and MasterCard.
Conformist on 17/04/2023 - 11:38

If people keep voting Labor or Libs, is there really a point in discussing?

People complain about fringe parties being too extreme, so nothing will change if they keep voting the status quo. And independents tend to be ex Lib or Labor anyway so many aren't any different, if anything there's less transparency around independents because who actually looks at their local candidates website to know specifically their policies and the media isn't going to report on a single independents voting track record anyway so there is no accountability. I'd be for independents forming their own parties as a coalition for this very reason. Seems like people just complain but when it comes to actually changing the way things work during voting period people seem to forget what has happened in the last two decades and then complain about the result a few years later.

My guess is that these issues will unfortunately continue and if anything get worse. If you're voting the same parties who don't make change that's what happens.
jaimex2 on 17/04/2023 - 11:54

+1

I stopped caring when the country voted in the liberals from Abbott onwards. I was so angry…

I was trying to break into the market and all the government was doing was adding fuel to the fire and people were all for it. Same goes for the RBA, what a bunch of irresponsible clowns. There was never a reason to bring the interest rates below 3%.

The time to solve this was 4, 3… Even 2 elections ago.

Anyway, you know what they say. Don't hate the player, hate the game.

I have my owner occupied and investment properties now. I stretched myself in 2015 and it's paid off.

Labor won't fix this, voters sent a very clear message each election. Don't touch house prices if you don't want to be voted out.

We deserve the crime and inequality were going to get. The days of reckoning for the greed have arrived.
- Assiduous on 17/04/2023 - 12:41
  
  Now you know why the world is the way it is. People looking past the issue of right and wrong, and acting and making financial decisions for their own benefit exploiting an unjust system, rather than working to change the system. Would you devalue your investments to vote for good housing and taxation policies now, or are you comfortable dishing out the same injustice to younger generations of Australians, like those LNP voters you mentioned?
  - jaimex2 on 17/04/2023 - 16:01
    
    +1
    
    Absolutely. My vote hasn't changed and I cant see it changing.
    
    I hate that houses are treated like investment vehicles instead of where people live.
    
    I'd be all for undoing all the crap thats has been done to create wealth gaps in Australia.
    
    Kill CGT discounts and negative gearing on housing.
    
    Shorten proposed grandfathering it to not make the boomers cry. Didnt work, the greed is too high in the country.
    - Assiduous on 18/04/2023 - 09:32
      
      OK good to hear, but it sounds like you are saying above that you hate your own actions?
      
      Unfortunately, your financial decisions have pushed wealth, and thus lobbying power, to the status quo vested interests (your FIRE industry business partners) that are major beneficiaries of the status quo that organize and campaign against meaningful reform. They use some of this wealth to influence and control the policies of the major parties via donations, professional lobbying outfits like the Property Council of Australia, and even bribery and corruption as we have seen property developers sent to jail for.
      
      Money is power, what you do with it, and who you give it to matters.
      - jaimex2 on 18/04/2023 - 13:59
        
        @Assiduous: I recognise that the only say I have is a vote every 4 years. I have no real power to influence anything.
        
        You can hate an unfair game while doing well in it.
- randome on 17/04/2023 - 15:38
  
  +3
  
  I also came to this realisation, however it was after the 2019 election.
  
  Labor under Shorten had a clear plan that would have stopped the tax loophole caused by the combination of negative gearing and the 50% CGT discount. This was killed by media serving vested interests and the majority of voters that already either owned outright or had a mortgage.
  
  The math behind this loophole is explained really well by this video https://youtu.be/k8MWPTdy7dw
  
  I now feel like Australian Property is like toilet paper during the COVID; you know buying extra is dumb but because everyone else is doing it, you have to do it too or you will miss out.
OzHan on 17/04/2023 - 11:58

+2

desirable suburb in Sydney or Melbourne - Neither sounds affordable, swap desirable with less desirable or Sydney with smaller city and suddenly its not so unaffordable any more.
Assiduous on 17/04/2023 - 12:06

+1

A majority of Australians believe that the continued increase in house prices is bad for the economy and is exacerbating wealth inequality.

When presented with the statement I have benefited from the longer-term increase in house prices around only 40% of homeowners agree.

Nearly three quarters (73%) (of surveyed economists and housing market experts) agreed that high housing prices and rents are impairing economic growth and productivity’.

The only real winners are private for profit banks, property investors, and parasites like realtors which are ~20% of the population. Everyone else pays while the economy suffocates.

Inflating land prices is a consequence of private for profit ownership of land which allows landowners and bankers to capture economic rents which allows wealth to be extracted from workers by those not working productively.

Economic rent seeking is essentially a form of financial slavery.

If you do not oppose economic rent seeking, then you are basically pro slavery and exploitation.

The solutions are straight forward, well known, and are proven to work in real countries including our own. They are not implemented / dismissed as impossible by the rent seekers that have been elected to parliament to further the interests of rent seekers.

https://centreforequitablehousing.org.au/our_work/the-austra…
https://cityfutures.ada.unsw.edu.au/documents/642/4_page_sum…
https://en.wikipedia.org/wiki/Georgism
- xavster on 18/04/2023 - 16:35
  
  +1
  
  How dare these economic parasites provide housing and shelter to those who cant afford it!
  
  Down with the bourgeoisie, lets go back to communism!
  
  /s
Dack Smith on 17/04/2023 - 12:07

+3

Not sure why people aren’t angry and raising hell with the state of things in Australia?

It seems everyone is content and very happy with rents skyrocketing and the lack of affordable housing.

If the wealthy landowners/portfolio owners/high powered celebrities and élite executives and super politicians are making all this money, then pushing up interest rates, and people are just…..letting them walk all over you….

I fear for our “democracy”

There is no longer a fair go for the lower classes.

We are all Americans with a different accent.
- Protractor on 18/04/2023 - 12:10
  
  +2
  
  We should build welcome mat factories for the conveyor belt of endless immigration heading this way.
  The system can't cope now. 900K in 2 years with experts already warning about the inflation it entails. Nest shitting only ever ends the same way, every time. Govt has become a corporation, shaped like a trough
richrichie on 17/04/2023 - 12:31

+2

Whenever this forum topic comes up, I find most will always blame investors, negative gearing, etc. Although they are contributing factors, but wouldn't getting rid of them also introduce new problems? I agree with vacant land/properties tax though, just a waste of our scarce resources.

Rental market is crazy at the moment and surely that is not because we have too many investors buying property? I find the number of apartments being taken out for Airbnb in the "desired" suburbs causes more damage, so those types of investors that should be targeted. Maybe they should have more tax for short-term rental?

And in the last 3-4 years whenever I am inspecting or trying to buy, I find those that outbid me by a crazy amount are rarely investors. They are often those first-home buyers or those that looking to upsize as they are buying beyond their means / use emotions to decide the property's fair price.

Many investors in the market below $1M that I spoke to (prior to 2022/23 that is) would often prefer new developments in "upcoming suburbs" too. Established properties reduce the depreciation that they could claim, comes in higher stamp duty, and they find the repair & maintenance beyond the warranty period do not worth the extra hassle. There are also less interest in apartment or unit investment (in Melbourne at least) as the capital increase is slow or non-existent. These investments are usually coming from overseas investors or those that need to balance their cashflow rather than negative gearing. So tweaking those negative gearing rules etc will likely only shift the market and make rental market worse.

Agree with the argument in Friendly Jordies video that some business benefits more than others in the current environment, and some dodgy developer/building practice.
But at the end of the day, our population growth is faster than the number of new properties being added. So unless there are more new supplies, I think demand will always be strong and property price is hardly going to go down much?
- Ghost47 on 17/04/2023 - 20:11
  
  But at the end of the day, our population growth is faster than the number of new properties being added
  
  Our population growth has largely been driven by net overseas migration, i.e. it is artificial and we can control it however we like. If we turned the migration tap off it's possible that the crisis won't worsen, but we're now at the point after two decades of relying on immigration that our economy is largely driven by it.
  
  IMO we're in a really messy situation that's been in the making for nearly two decades.
  - richrichie on 17/04/2023 - 23:12
    
    Good point re: overseas migration.
    
    However, turning it off will introduce us more problems. We have seen when migration was halted during covid times how badly our labour market shortage was (and still is), and how the universities struggled with funding. As you said, our economy is largely driven by it.
    
    I don't see overseas migration as a bad thing. Those that come here are majority above average skill-wise or financially. Students are bringing in a lot of overseas money paying University fee (some course is now $50K or more per year), rents, their living cost, family visiting, visa fees, etc. Those students that need to work often can only fill in low paying work that locals do not want to do, have to pay tax on their income, and have very limited working hours. They also mostly come at their prime working age, and we did not have to spend a cent during their growing-up years. Many wont get much benefits from government for their first 5-10 years (or at all) in Australia unless they are highly skilled.
    
    IMO, building more properties (or making those vacant ones available - including short stays) to accomodate these people might actually be less messy than turning them away.
    - Protractor on 18/04/2023 - 12:27
      
      -1
      
      WTF?
      900000 ppl in 2 years. That's not a challenge>problem>let alone a benefit. It's a catastrophe on multiple levels.
      We can't keep up now. The snake is eating it's tail.
      Population rates stopped driving any positive change decades ago.
      There is a trades shortage (OS trades people are no equivalent), logistics issues,health crises,burnt out Drs,energy dramas,water supply shortages, ballooning crime rate,drugs ,impending conflict with China and every corner of cost of living is racing away.
      There is nothing smart or useful achieved by adding fuel to this fire . It's delusional to keep denying humans have become there greatest existential threat by weight of numbers. Those who swallowed the jobs and growth mantra are the greatest deniers and threats to any harm limitation strategy.
      Turning off the conveyor belt has more (long term / sustainable ) positive outcomes. The people who are MOST dependent on migration ($$$$) are the only ones with access to the switch
      - richrichie on 18/04/2023 - 13:53
        
        @Protractor: Not sure if I am following the arguments nor the numbers. From ABS data, our total net migration in the last 5 years is 750K people with an average of 150K people per year. Stretching it back to 2004-05, the average is still slightly below 200K people per year. Unless you meant we have added 900K people in 2 years including Australians births? If so, then that sounds about right.
        
        There is no denying about all the issues you highlighted there are happening, or likely to happen, and a growing population could help contribute to that. But at the same time, I am not sure how turning migration away will help solve them. We are lacking many talents in critical skill sectors, and they are the contributing factors to some of issues you mentioned (health crises & burnt out Drs). The cost of living increase could also be partially attributed to that, when we don't have enough labour to keep harvesting our produce. Upskilling takes time and we simply don't produce enough local talents (from personal experience trying to help recruit scientist in the last few years and got very few local applicants).
        
        Not sure how familiar you are with the idea of population pyramid, but I think Australia has done a decent job in filling in population through skilled migration with people at their prime working age (25-39) to help lessen the burden of aging population. No doubt that the more humans in this world, the more world's resources we are going to need & waste. But the net population growth is also fuelled by our longer life expectancy. Hence we also need to be realistic about who is going to foot the bill, takes care of the elderly, and keep the economy engine running.
        
        Protractor on 18/04/2023 - 13:55
        
        @richrichie: Follow away>
        https://www.news.com.au/national/politics/cant-keep-up-west-…
        
        Not even stupid. It's destructive and reckless. The "who is going to take care of the elderly" debate fell down a rabbit hole when Berejiklian delivered Newmarch House and Ruby Princess. Those two decisions killed (exponentially) thousands of ppl, many elderly innocents,spread the virus rapidly,and all while the carer cohort (on multiple jobs. By choice) took covid from centre to centre to centre till all control was lost. And ppl whinge about Dandrews.The 'model' we have for aged care is broken because of the opportunists at the top end, not the lack of foot soldiers at the bottom end. If we expect "more" people to solve this and the other massive population driven issues, we deserve to be taxed into poverty . That could be the 'better' of probable outcomes
        
        richrichie on 18/04/2023 - 14:15
        
        @Protractor: I agree that adding 900K residents in 2 years are excessive and will cause problems without adequate infrastructure investment.
        But I still don't know where news.com.au gets all their numbers and predictions from.
        ABS reports a different number to them. For example, the 2008/2009 number from ABS is less than 300K while they are saying 450K - that's an extreme hyperbole?
        
        Anyway, my point is, turning the migration to 0 is also not an ideal solution. Not saying we should increase them to 500K people per year, but keep the number sensible like what we have been doing in the last 20 years, and fill in the jobs that we need. And while we are doing that, build more houses to keep the supplies steady.
        
        Protractor on 18/04/2023 - 17:50
        
        @richrichie: Investment? Shuffling sh*t won't fix nada. It needs physical infrastructure operating NOW. We are already behind by ten years. It takes decades for this country to build a major rail or road project. 3 years just to think, Then an election sets it back.
        Inflation will explode in the next 2 years. If ppl think it's hard now, they are going to be shredding themselves by 2025 gets here. Both sides of politics have self interest reasons to import bodies. Neither of the models in our countries best interest. Educating and training the existing population, fixing health worker wages and conditions, and getting our communities socially cohesive is the only curative direction. Dutton has scuttled any hope of that. He just wants to keep dividing on every issue.Today he began picking on the disability sector. He 's deranged.
        Perrottet was going to seek 2 million migrants in the same space of time. Also deranged
        
        There a stupid family reunion component in the migration rules that is being gamed wilfully by a few opportunistic cohorts. That is also deranged
        
        richrichie on 18/04/2023 - 18:54
        
        @Protractor: Yeap, it is very slow to get any infrastructure project completed here. And changes in government then often scrap an already slow going project. I think someone else mentioned about high speed rail below, and imo that will open up many more cities beyond the already crowded Sydney and Melbourne.
        
        But the family reunion migration thing is not entirely true. Those visas are only for direct family (parents, spouse, and kids) and are very difficult to get, majority with 20+ years waiting time for parents. Many could not even pass the health check anymore after they serve the waiting time. Aged parents that manage to get here normally have to invest a large sum, and then have very limited access to residents' benefit like medicare initially. It is not much better than a longer-stay tourist visa.
- Mistredo on 18/04/2023 - 00:20
  
  Getting rid of investors would harm rentals, but buyers would be better off as they wouldn't need to compete with investors.
  - richrichie on 18/04/2023 - 00:43
    
    Yeap, middle income people with decent paying jobs and have deposits ready would likely benefit if investors incentives are removed.
    
    Those on the bottom end would probably continue to suffer, as the high rental would squeeze their income hard and won't have enough to save for a deposit.
- xavster on 18/04/2023 - 16:39
  
  Investors are the problem, there's not enough of them. If we didn't have anti-investor policies, we would have more properties available for rent.
GG57 on 17/04/2023 - 12:44

+1

I tried to find some relevant and recent data, but maybe someone else will have something better:
In 2019–20:
- There was an average of 2.6 persons per household and 3.1 bedrooms per dwelling.
- One in twenty-five (4%) of households were in need of at least one more bedroom.
- More than three quarters (77%) of households had at least one bedroom spare.
This suggests that we have the capacity (bedrooms), but not in the optimum configuration (bedrooms per dwelling vs persons).
Add to that the number of empty dwellings (specifically holiday homes) which can be totally empty for extended periods of time.

The solutions are there, but we are probably not wanting to impact our own lifestyle to make it happen.
- orangetrain on 17/04/2023 - 13:07
  
  +1
  
  Missing from your data list is that ABS does not record vacant land despite it being zoned for residential or how many bedrooms are in these unoccupied dwellings as there's no one reporting it.
  - GG57 on 17/04/2023 - 13:34
    
    I suppose vacant land in Australia is almost unlimited.
    
    There is probably a reasonable assumption of 2+ bedrooms in an unoccupied dwelling. Someone can do the maths.
    
    As I said, someone else may have better data.
    - brendanm on 17/04/2023 - 13:42
      
      I suppose vacant land in Australia is almost unlimited.
      
      It's not, at all.
    - Protractor on 18/04/2023 - 12:32
      
      Vacant land in Straya as far as $$ development fro housing = whatever native vegetation has survived to this point anywhere within cooee of existing development. State govts would rather clear that land,than pay for already cleared land in private hands. Most govts would rather build out than up.
      
      But> Bottom line is every issue (including housing) is a direct result of an overpopulated planet. Capitalism smashing into nature
bazingaa on 17/04/2023 - 12:50

The average income in Australia is 92K pre-tax.

considering average is useless, median should be used
IPYF on 17/04/2023 - 12:55

+1

Real estate investment has (in this century anyway) always been something of a game. It's been there for the people who have the means to play in the space, and there have always been methodologies for becoming involved. As such I don't view much of the happenings in the buying/selling space to be particularly unique or new.

But, the part of this holistic crisis that is new and nutty is that historically if you didn't want in on the real estate game, or straight up knew that it was forever out of your grasp (relevant to many lower and middle income earners), then you were able to subsist, reasonably, as a renter and continue existing in society in some capacity.

But now, unless you've got something already (and your landlord isn't a full-blown 'Seaward' who has jacked the price to infinity) finding a rental without a queue of 40 applicants in line for it is almost more implausible than finding one for a fair-adjacent price.

For the first time in my lifetime, those people who aren't already comfortably set-up with a property or long-term stable lease, are truly entirely stuck between a rock and a hard place, and quite frankly I don't know how these people are expected to cope.
umoddbro on 17/04/2023 - 13:02

+2

Australians are great at complaining but not actioning…. we've been b@#$ing about the affordability crisis for decades yet at the end of the day we just 'suck it up' and accept its just the way of life. So to answer your question nothing will be done. Politicians are too comfortable with the current scheme of things and any changes to it will adversely affect their financial interest. Why would they tax property investments when a majority of them own more than one investment property, they are laughing all the way to the bank with the current property/rent market.
- OzHan on 17/04/2023 - 13:12
  
  +1
  
  Not just the politicians, home ownership is 67% in the country and vast majority of these people don't want their home values to drop. these people had voted against Labor who was trying to abolish the NG in the 2019 election.

Australia's Housing Affordability Crisis

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