Australian Property Prices

Australian Property Prices

House prices in Australia have become so unaffordable
that many young families simply cannot buy into the market. Wealthy Australians have become a nation of
property “investors” thanks to a series of government policies that allow and encourage
it. The lower and middle class have either been
burdened with massive debt, or they are stuck renting for the rest of their lives. In the 1970s, the average house price was
about twice the average annual income. If we used today’s figures as a guide, the
average home should only cost about $140000 to $150000. But in reality, the average Australian house
price is much higher. Homes in Brisbane have a median cost of $478000;
Perth $515000; Melbourne $595000; and finally Sydney comes in at a whopping $776000. Bubble, Bubble By many definitions of the term, Australia
is in a classic bubble. Japan had one in the 1980s which burst in
the early 1990s and sent their economy flying into a downward spiral. They are still feeling the effects of it to
this day. Ireland also had a major property bubble which
burst in 2007. Despite the bubble bursting, media commentators
still encouraged people to go out and buy. Irish television was littered with house-hunting
and house makeover shows encouraging people to increase their property “portfolio”. Much like what is happening in Australia at
this very moment. It’s unbelievable that we’ve allowed this
to happen. In my opinion, a house should not be an investment. It’s a place for people to live and to raise
their families. It’s a necessity of life. To say that an investor should be allowed
to take $400 (or more) a week away in rent from a poor family just because the owner
happens to have more money than them, is in my opinion, immoral. It’s a classic case of the rich becoming
richer and the poor becoming poorer. If history has taught us anything, ultimately
this social hierarchy will fail. Future generations will not tolerate such
obvious exploitation. Wage Slavery Of course, many property investors will justify
their actions saying things like “We’re only doing what the law allows”, and to
some extent, they are right. However, it is not good for society to have
all the workers (i.e. the people who actually build and create things) to be stuck in a
constant slave-like existence. They work hard every week in order to pay
off their mortgage, or pay the rent. They do not have the option of leaving their
job, even if it is the most dirty, dangerous or demeaning one. If they did leave, either the bank would take
their home, or the landlord would kick them out. The current system is not too dissimilar to
the days when workers used to work on site (for example, the cotton mills) working long
hours, getting paid very little, and being treated like second-class citizens. If the mill workers ever complained, there
was usually only one outcome – losing your job, which in those days often meant either
starvation, or a life of crime and begging. The landed gentry (that is, the owners of
property) earned most of their income from owning land. Their job involved going around collecting
rents. In our modern system, landlords take on a
similar role. In my last flat that I rented in Brisbane,
my landlord owned four blocks of flats. His job literally involved going around collecting
rents which I had to hide under the hot-water heater in our garage. The fact that he was collecting cash probably
indicates that he was not telling the government about his full earnings. Hard Work Pays Off? The modern landlord class is no different
from the landed gentry of the past. They are maintaining their wealth by taking
from the poor. I have a friend whose boss owns 23 properties
around our district. Who needs that many houses!? I’ll tell you who – someone who is obsessed
with money; someone who has put their greed above the needs of the average person. Sure, they’re doing everything by the book,
but is it moral and does it benefit society? I’m sure most land owners would disagree. They’ll probably say that they worked hard
for their money and made some wise investments. Even if this is true, many people simply do
not have the ability to “invest wisely”. More often than not, land owners have inherited
at least some of their wealth, or have gotten lucky with some of their investments, but
more than likely a combination of the two. If “working hard” was the only criteria
to becoming rich, then surely most people would be rich. I know lots of people who work hard, for example,
people who volunteer at the local rehabilitation clinics. But they don’t have multiple properties
to show for it. Or what about a cleaner who has three jobs
cleaning for three different supermarkets working for minimum wage? They will probably never have multiple properties,
let alone their own home under the current system. When the land owners say “just work hard
and you too can be well-off”, they’re simply trying to convince the rest of us to
continue working, doing the crappy jobs they don’t want to do. It’s a complete fabrication. Some hard workers get rich, and some lazy
people get rich. But most of the people on this planet are
poor. Everybody can be Rich? It’s a lie. If everybody on this planet had exactly $10
million each, then nobody would be considered rich. Prices would just rise to suit everybody’s
new found wealth. Rich people only exist now because there are
plenty of people being exploited. With every millionaire, there are thousands
of workers supporting their lavish lifestyle. A rich person who says “anybody can be rich”
is either kidding themselves, or being intentionally deceitful. What especially angers me, is that many wealthy
individuals blame poor people for their own misfortune. What the rich forget is that if there are
too many people who cannot afford shelter, clothing and food, then crime rates skyrocket. Think about it. If you were unable to service the needs of
your family and you saw that your children were going hungry, you’d probably go out
and steal something just to get food on the table. It’s happened time and time again throughout
history. Usually the first response of the ruling elite
is to “crack down on crime”. This usually involves serving out stiffer
penalties and longer jail sentences. But I think most of us know that this doesn’t
solve the root cause of the problem. In the 1800s, England was famous for introducing
laws that allowed landowners to shoot trespassers who did not give themselves up. This was to stop hungry people climbing over
the fence and stealing apples from the owner’s orchard. Those who weren’t killed on sight, were
often caught by the authorities and given hefty prison sentences. Some were even sent to Australia on prison
boats! It’s strange how humans act towards one
another. When confronted with a hungry person trying
to get food for their family, instead of giving them food, we shoot them dead. Of course, this isn’t literally true any
more, at least not in Australia, but the class divide still exists. Greed Ultimately, Australian property prices have
got to where they are today as a direct result of people’s greed. Instead of treating houses as a place to live
and raise a family, we are now treating them like gambling chips. Investors think the goal is to obtain as many
properties as possible, regardless of the people’s lives they are affecting. Luckily, at least for some of us, greed comes
back to bite people as seen in the Japanese and Irish property crashes. Instead of thinking about our own hip pockets,
we should consider what is best for society as a whole. Updates (February 29, 2016) A recent article on the
ABC discusses the impending bursting of the Australian Property Bubble. Australian mortgage debt has grown to a staggering
$1.4 trillion. Australia’s total debt to GDP ratio is third
only to Japan and the European Union. Our private debt in now at about 130 per cent
of GDP. In around 2012, the Reserve Bank correctly
identified that the resources boom was about to end leaving thousands without jobs. To counteract this, they started cutting interest
rates in a deliberate attempt to fuel a construction boom. It worked, but had the added effect of overly
inflating property prices to the unsustainable levels they are today. Sitting back and ignoring the warning signs
is a sure way to bring about a disaster. The problem with all bubbles, governments
never seem to be ready for them, and after they burst, the consequences are felt for
many years to follow.

30 thoughts on “Australian Property Prices

  1. Well said.
    A house should not be an investment…. it's a long term consumer good.
    Bring on the crash, it's long overdue.

  2. $140000 you think for a house.So thats all it should cost today.Can you do the same math with say ,cars??????
    A unit in Clayton cost a $million.

    One thing know one wants to under stand is <,THERE IS NO HOUSING STOCK ,

  3. October will see a MAJOR correction in Property and Shares. You will have no where to hide thanks to the lack of a recession(reset) nine years ago. We will see a double whack. The RICH and the POOR will get wacked think of a DEPRESSION this time. Good luck to all you are going to need it. The piper is coming and he wants your money and property not your life.

  4. I do like the report but please remember that someone who becomes an investor is merely trying for the most part to find a way out of the system of financial enslavement.And is trying to do so legally. Can you blame people for wanting to get out of the rat race and paycheck to paycheck living?

  5. It is a bubble built on cheap finance, and it should be burst. It is a disgrace that we have governments at both state and federal levels who believe in expensive housing. These overpaid poli-dopes would prefer not to lift a finger to stabilize prices. All they have done recently is add fuel to the fire. There is no good reason house prices should be so high. Banks, aided by record low official rates, are happy to lend these sums.. but these high values fail to reflect fundamentals; low inflation, low wage rises, low rental increases and subdued building costs. It is a debt effect; not a wealth effect.

  6. Totally agree with you. Thanks for creating this video. Enough is enough. We are walking on a fine blade, supported by our government policies and how much debt banks are willing to support. Neither of our government parties want to be responsible for the collapse that should have happened years ago, so they would rather just dig a deeper and deeper hole until they die and don't need to face the consequences. It will be gen y and millenials that have to pick up the pieces in the end.

  7. what a cry baby we have here…..
    give everyone 10 mill and the wealth will go to the investor … or not….. as it has always done. ask yourself that before blaming the world for its injustices mate…..hope you wake up….

  8. A property slump might happen , and all it will do is wipe out the people that cant afford   it . ONLY make the rich richer, as the rich have there money sitting in cash and like the tiger
    waiting to jump onto there next bargain buy . So you see the rich will always get richer , THE ODDS ARE ON THERE SIDE.
    The government will never introduce a rule that effects  there own  investments , and l BET with the money they earn , they all have extra property or shares or wealth in other arears . YOU CAN NOT WIN .  IT WOULD TAKE A VERY  VERY  BRAVE PERSON TO INTRODUCE LAWS TO STOP GREED . IT HASNT HAPPENED IN THE LAST 100  YEARS .
    AND  IT NEVER  WILL .   

  9. First person I've heard describe investing in property as immoral – good on you! I've been saying this for ages! If people want to build a business through hard work or invest their own hard earned money in investing in a start-up or actually renovate a run-down dump in order to make a profit eventually that's fine. But ppl sitting on properties they don't live in create artificial demand, forcing prices up and pushing more ppl into the rental market so they can make money… for doing NOTHING

  10. Some people are just fucked.My own mother for example, got divorced with two young boys. Lived in rental squalor all her productive life, buys a tiny old house in a bogan hood just before retirement…..pits her super through the pokies and collapses in bankruptcy with a crippling second mortgage.I worked and still do 80 hours a week, I own four houses because I know where renting your whole miserable life gets you.

  11. Check this sums up how and why the current price growth esp. in Sydney and Melbourne can't just sustain. Current prices are purely based on virtualunrealised gains…..I bet this will be far bigger than the US subprime and it will damage the economy in a massive way.

  12. i have to agree completely. Some people own too many houses and they don't even look after them. Every landlord i have had will look for the cheapest part to fix a broken one. and think that is looking after the property. In truth most landlords don't deserve their multiple properties if they cannot maintain them.

  13. Due to multilingual ability I know a lot about immigrant and refugee groups. There was a big inflax of the east European refugies in late 70s and early 80s. All of them came to this country without any money. Now the number of millioners among them is much higher then the average for the rest of Australians. Not all of them became millioners, but 99% make a decent living. Even those, who came when they were in their 50s own one or more properties. They worked hard and made right choices. They also invested heavily in their kids education. Unless one has physical or mental problem, there is no excuse to be poor in Australia. This is one of the best countries in the world and don't try to change it with your leftist bs.

  14. If the banks hold interest rates at 1% or whatever it is (a token amount) for the next 10 years, a lot of the mortgage debt would have been paid off, because almost all of it comes off the principal. If they don't, the whole system will collapse. Which do you think they'll choose?

  15. Why do people always make this issue so complicated when its not, its simple. People want jobs + jobs are in the city = too many people all trying to cram into the city because that's where the jobs are. The solution is regional development and regional jobs…. there are ALLOT of people who would love to move out of the crowded city, but they got to have job security.

  16. Yes housing shouldn't be allowed for speculation nor for Negative gearing. Non citizens & PRs only b allowed 1 for owners occupy in inner cities. Reason: protect country s security, sovereignty & strategic accessibility of cities

  17. Spot on,well done ✅
    It’s funny how often you mention society but sometimes I wonder what that is anymore.Is what we have now conducive to the advancement of the family and those with whom we share this patch of dirt,I don’t think so.The ongoing attack of once what we held dear either through “social Media,”Reality Television,”Greed and Narcissism,prompted as good things while the family becomes something of a second fiddle.
    We need to realise that the things we desire through technology and wealth accumulation will only take us backwards as far as what we used to hold in such high regard.Family.
    Slow down,coming 1st doesn’t always mean your a winner😔

  18. Hey, have you ever heard of the USSR? Maybe you could go to a socialist country with your naive morals,….. Venezuela maybe?

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