The Housing Crisis

[rev]

Why wouldn't you state that the JapNese population is falling by nearly 2 million and now 125 million with a GDP of 4.2 trillion which is about a 25% fall. Thats a little disingenuous. They are in deep trouble because of their ageing population.

I'm aware of their ageing population.
The point was that they've managed to continue to grow their economy without flooding their country with migrants.

Japan will be just fine. They're not self loathing idiots like our country.

That I agree with! So much to be enthused about and instead there is constant negativity.

Exactly. Australia has so much potential left if our politicians can get it right.
The first home owner guarantee is limited, was it 35,000 places in the 2023/2024 financial year?
Its left up to the banks to decide if you can use state government first home owner grants (in SA I think it's $15,000). The FHOG requires a deposit of 5%. On 500,000 that's $25,000.
Federal government should make it so that banks have to accept first home owner grants as part of a deposit.
And expand it to more then 35,000 places.
$500,000 wont get much if anything in existing suburbs, but in new developments it sure will.
There was speculation that it could help drive down prices. And other then a shortage in supply, high prices is one of the major factors keeping more people out of owning their own home.

[rubberman]

I'm aware of their ageing population.
The point was that they've managed to continue to grow their economy without flooding their country with migrants.

Japan will be just fine. They're not self loathing idiots like our country.

That I agree with! So much to be enthused about and instead there is constant negativity.

Exactly. Australia has so much potential left if our politicians can get it right.
The first home owner guarantee is limited, was it 35,000 places in the 2023/2024 financial year?
Its left up to the banks to decide if you can use state government first home owner grants (in SA I think it's $15,000). The FHOG requires a deposit of 5%. On 500,000 that's $25,000.
Federal government should make it so that banks have to accept first home owner grants as part of a deposit.
And expand it to more then 35,000 places.
$500,000 wont get much if anything in existing suburbs, but in new developments it sure will.
There was speculation that it could help drive down prices. And other then a shortage in supply, high prices is one of the major factors keeping more people out of owning their own home.

The problem with these policies, be that first home owners grants, or accessing super, is that real estate agents and owners know about it, and prices go up by whatever the size of the grant is. Plus, guess what, even if REAs didn't increase the price, if everyone at an auction has an extra $20k in their pockets, then they will bid that much. Those schemes are popular because they are a direct deposit into the pockets of home owners.

[rev]

Back to the topic instead of the trolls drama sessions..

https://www.news.com.au/finance/real-es ... f895ece77b

Three of the most unaffordable cities in terms of housing right here in Australia, Adelaide being one of them, while wages and salaries in Australia have seen the biggest decline in the entire OECD.

[abc]

Back to the topic instead of the trolls drama sessions..

https://www.news.com.au/finance/real-es ... f895ece77b

Three of the most unaffordable cities in terms of housing right here in Australia, Adelaide being one of them, while wages and salaries in Australia have seen the biggest decline in the entire OECD.

Its a ludicrous situation we find ourselves in with all of those other cities with the possible exception of Bournemouth (Richie Rich town) and San Jose being much more important cities.
It highlights this is an Australia issue primarily due to the migration intake and Adelaide has taken up the overflow.

[SBD]

Page 2 includes a long article that includes a quote that housing construction was already slowing. Nobody (in the article or here) has attempted to either challenge or explain that statement.

There seems to be plenty of land "released" for housing. Has somebody done an analysis of what is missing and any attempts to address it? Are builders leaving the industry because aged carers get paid more? a few years ago, there were a bunch of building companies went broke, mostly because they offered fixed-price construction with variable-priced inputs. Is that still the problem?

[rubberman]

Page 2 includes a long article that includes a quote that housing construction was already slowing. Nobody (in the article or here) has attempted to either challenge or explain that statement.

There seems to be plenty of land "released" for housing. Has somebody done an analysis of what is missing and any attempts to address it? Are builders leaving the industry because aged carers get paid more? a few years ago, there were a bunch of building companies went broke, mostly because they offered fixed-price construction with variable-priced inputs. Is that still the problem?

Part of the problem with generalist sources like newscorp is that they don't have specific expertise in either describing problems or proposing solutions.

That's because things like affordability can mean different things to different audiences, and you need to have someone who understands that interpreting these articles. News media in Australia have gotten rid of much of this expertise.

In this case, there are at least 10 countries in the EU with worse housing affordability. Plus South Korea and Taiwan, Israel and Switzerland. Why did Newscorp omit those?

So, out of those 8 picked by Newscorp, we are bad. Out of those 8 plus the other comparable countries, ie 22, we are mid level at best.

That's not to say that there isn't a problem, but cherry picked data is largely unhelpful. If we want to solve a problem, then we need to start with accurate information, otherwise it's garbage in and garbage out.

https://www.numbeo.com/property-investm ... ountry.jsp

As an example of cherry picking...the link above goes to a site that's often used by people and companies when deciding how much money is needed to work overseas. It's specialised and accurate. BUT. It lists Australian housing affordability as being relatively high. So, obviously BS. However, when you look at the list, it includes countries not comparable with Australia. So unless you only include those countries that ARE comparable, it's BS. The Newscorp article does it the other way around. It EXCLUDES comparable countries which are worse than Australia.

How can we even begin to attack the problem if we can't trust data providers to give us an accurate picture?

[PD2/20]

Page 2 includes a long article that includes a quote that housing construction was already slowing. Nobody (in the article or here) has attempted to either challenge or explain that statement.

There seems to be plenty of land "released" for housing. Has somebody done an analysis of what is missing and any attempts to address it? Are builders leaving the industry because aged carers get paid more? a few years ago, there were a bunch of building companies went broke, mostly because they offered fixed-price construction with variable-priced inputs. Is that still the problem?

Part of the problem with generalist sources like newscorp is that they don't have specific expertise in either describing problems or proposing solutions.

That's because things like affordability can mean different things to different audiences, and you need to have someone who understands that interpreting these articles. News media in Australia have gotten rid of much of this expertise.

In this case, there are at least 10 countries in the EU with worse housing affordability. Plus South Korea and Taiwan, Israel and Switzerland. Why did Newscorp omit those?

So, out of those 8 picked by Newscorp, we are bad. Out of those 8 plus the other comparable countries, ie 22, we are mid level at best.

That's not to say that there isn't a problem, but cherry picked data is largely unhelpful. If we want to solve a problem, then we need to start with accurate information, otherwise it's garbage in and garbage out.

https://www.numbeo.com/property-investm ... ountry.jsp

As an example of cherry picking...the link above goes to a site that's often used by people and companies when deciding how much money is needed to work overseas. It's specialised and accurate. BUT. It lists Australian housing affordability as being relatively high. So, obviously BS. However, when you look at the list, it includes countries not comparable with Australia. So unless you only include those countries that ARE comparable, it's BS. The Newscorp article does it the other way around. It EXCLUDES comparable countries which are worse than Australia.

How can we even begin to attack the problem if we can't trust data providers to give us an accurate picture?

I noticed the selection of only 8 countries. But as the annotation in the graphic indicates,chose to chose to this selection was done by the originator of the graphic, Visual Capitalist. However Newscorp chose to reproduce the graphic.

[rev]

Page 2 includes a long article that includes a quote that housing construction was already slowing. Nobody (in the article or here) has attempted to either challenge or explain that statement.

There seems to be plenty of land "released" for housing. Has somebody done an analysis of what is missing and any attempts to address it? Are builders leaving the industry because aged carers get paid more? a few years ago, there were a bunch of building companies went broke, mostly because they offered fixed-price construction with variable-priced inputs. Is that still the problem?

Perhaps housing construction has slowed because builders keep going bust? or perhaps also it's a case of how data is viewed? I mean if there's housing waiting in the pipeline, because a) fewer building companies & b) taking longer to secure tradies to do jobs, then obviously there's going to be a delay in homes being built?
Wasn't there also meant to be an uptick in approvals, and builders taking on more work then they could complete (presumably due to the high prices that they want to take advantage of and turn a bigger profit) which has created a back log?

https://grattan.edu.au/wp-content/uploa ... r-2021.pdf

Have briefly skimmed through this, but there's a graph on page 9 that's pretty damning.

The only solution our governments seem to have, is "bring in more people from the third world".
How much has our population grown in the last 20-24 years? And they just want to keep adding more and more. There's your number 1 reason why the housing crisis is as bad as it is, and why it will get much worse in the next few years if their intention to flood us with another 2 million people proceeds, which it will.

This country needs and deserves better politicians.
Politicians who are actually going to address the problems this country has, with real solutions, with a vision and plan.
We've fallen behind the rest of the OECD on wage growth, a 6% decline was it in the last 12 months?
We've fallen behind housing stock compared to the OECD.
Dare we look what else we may have fallen behind on or gone backwards compared to the rest of the developed world?

[rev]

-Sydney is the 2nd least affordable among 94 major cities in the world. Adelaide is in that list too. Graphics with selected cities highlighted doesn't change that fact. If people can just ignore the professional troll, and actually discuss the actual issue and not the distraction the professional troll and his cohort throws out.
-So an increase in migration ('people' for professional trolls too dumb to understand) has driven up demand of already limited stock.
-Just Sydney alone will require an extra 900,000 houses in the next decade and a half to meet the expected population increase of 1 million by 2041.
-Vacancy rates of rentals is at record lows across Australia.
-Houses are 30% more expensive to build then prior to the pandemic, inflation a major factor. Adding more people, which increases demand, which drives prices up.
-Builders in trouble, took on fixed rate contracts, costs have since risen - hence builders going bust.

[rubberman]

The high level problem is that the Federal Government gets income tax revenue from more skilled migrants. It needs that extra money to balance the books, otherwise the "Debt and Deficit!!" hawks start screaming. The public has been conditioned to believe that debt and deficit are bad, and little sensible debate can be held about it. Raising taxes is also verboten. Political suicide. Outsourcing of public sector jobs to contractors has led to scandals in about ever case.

So, the easiest way for Federal governments to get money is from taxes on more immigrants.

However, State governments get very little extra revenue, and they are the ones who need to build hospitals, schools, dams, social housing etc etc to accommodate the extra people.

Immigration isn't going to stop anytime soon. If a Federal government did it, the debt and deficit would go up...and we would vote them out. Either party.

It gets worse.

Australians mostly want free standing houses with gardens...near the CBD...and cheap. Pretty much impossible to get all three at once.

Overall, we have what we have because of how we vote. Then we get angry because how we vote does that.

Governments have, in the past, spent huge amounts of money building cities like Elizabeth, migrant hostels etc. So it can be done. But I can only imagine the screams of outrage if governments today tried to do that.

[SBD]

Elizabeth started with two large employers who needed accommodation for their workers, both immigrants and internal migration. The state government built a lot of housing in "integrated" (I'm not sure if there's a better word) suburbs but created or enforced a class system in the housing that I doubt would be accepted today (management have detached houses on main roads, foremen have brick duplex on secondary streets,, workers have Besser brick duplexes deep in the back streets).

Australians want detached houses with back yards because:

• we've been told that's what we want
• It's what our parents had, so it's all we know
• The examples in Elizabeth and places like it demonstrate we are doing better if we can get out of the lower-class housing we grew up in
• Not much else is being built and marketed because of the above reasons

We have "student accommodation" which is clearly intended to be temporary until they can afford something better We have stamp duty which works as a disincentive for "empty nesters" to downsize.

To my knowledge, nobody has attempted to build and market a "European style" or "English style" building/suburb/housing estate to demonstrate to potential residents that there is "another way" with a big enough marketing budget to overcome "what we know" and "what our friends have" inertia. I haven't noticed new duplex housing even in renewed suburbs that used to have it.

[abc]

from 'your' abc

[SBD]

from 'your' abc

I wonder what it means to "afford a house". Presumably it means to borrow and service a loan with minimum deposit. But is "a house" a detached four-bedroom home with two bathrooms, separate study/WFH room and lockable parking for two cars and a boat/caravan suitable for a family? Or is it a two-room studio apartment suitable for a single twenty-something moving out of that family home?

I'm not sure a single number for the entire market is meaningful.

[Jaymz]

I wonder what it means to "afford a house". Presumably it means to borrow and service a loan with minimum deposit. But is "a house" a detached four-bedroom home with two bathrooms, separate study/WFH room and lockable parking for two cars and a boat/caravan suitable for a family? Or is it a two-room studio apartment suitable for a single twenty-something moving out of that family home?
I'm not sure a single number for the entire market is meaningful.

I magine they've worked it out from the median house price for each city, as in a detached property. It's a figure which seems to vary wildly depending on which publication you read on any given day.

I find it a bit confusing at times and I'm pretty sure some news sites wrongly report the median house price as the median "dwelling" price, which is house and unit prices combined.

Added to that there is also a median "unit" price and is often reported as such.

[Goodsy]

using Commbanks borrowing calculator with an 8% interest rate they'd let you borrowing 450k on a 100k (pre-tax) salary.. a 163k salary at 8% they'd let you borrow 680k

Maybe they're only talking about the actual City of Adelaide and not the suburbs?