The change in economic values and the housing crises

The topic is called, The change in economic values and the housing crises - it’s the best title I could come up with at this moment, but maybe economic culture could be more apt.
Lately as many of you have been hearing in media there has been quite a bit of discussion about the difficulty either renting a property or buying a property in one of the capital cities. One article suggested that in Sydney that the grand parents wouldn’t get to know who their grand children were because they couldn’t live in the same city. So yes we do have a problem that has reached major proportions.
From what I have been listening to in various talk back radio shows and some podcasts, nobody is offering up a solution or wanting to talk about how we got ourselves into this mess, and it’s not just us, but other countries that have followed the same policies over say the last 40 years.
The first narrative I hear is that people say we haven’t built enough houses and the types of properties that Australians want to live in.
The second thing I constantly hear is that it will take too long to build more houses and this is where I got thinking about the economic history, culture and ideology of Australia and how it had changed in a bad way right from the local council level to the state and federal level, but I’m particularly astounded by the attitude of the local councils in so many areas. Many of these politicians have no idea about business, only the ideology they were taught at school, so what type of policies can you expect - stuff that makes no sense.
As a community I feel we have lost our pioneer spirit. How is it that in a 12 year period around 1911 that Australians were able to put out a competitive tender to come up with and design and build a city called Canberra and now in 2024 we say no to this type of venture. We have gone from can do to a No can do. The question is why ? We won’t even build a dam or a fast train.
In the space of the last 40 years we have done nothing but push mainly Sydney and a Melbourne and more recently Brisbane but we have neglected the smaller capital cities and all the regions shutting down banks and essential services. By now we could have had at least 5 cities the size Canberra, but in 2024 we just won’t do it,
In the last 40 years we have also managed to destroy our own manufacturing base, we have allowed our water ways to be sold off and our farming snd agriculture sector to be bankrupted by giant corporations and now we are implementing all sorts of regulations and net zero policies, that make no sense.
The third thing is that we have lost our ability to allow people to flourish by leaving them alone to create things either by hampering them with higher taxes and make people jump through all sorts of regulations or distorting markets through big government expenditure policies on the wrong things. For example what incentive is there for Australians particularly from Sydney and the east coast to move to say the regions, Adelaide and other capital cities. How about paying no tax or rego for 5 years for someone who moves their family from Sydney to Adelaide to balance out the cities. Right now Adelaide real estate is 48 percent cheaper than Sydney. The government says that it wants to go halves in property with individuals - that’s not going to make property more affordable, it will do the opposite and the government will own you and your property,
I will close by saying that when my parents immigrated to Australia in the early 1960’s with not much English at around the age of 44 and 38 and with nothing but a suitcase they were able to achieve so much in the space of 30 years and my mother was a stay at mother. There was less surveillance, less interference, more community spirit and local activity and people got ahead, helping each other. It was free to go to the local tip, cement bags, roof tiles, hardware, steel
and bricks were almost free, just bring your trailer.
We have lost this spirit and we have lost our way where even when you drive to work today you are constantly looking at your speedo to check that uou haven’t gone over the limit by accident and snapped up by the 50 cameras you passed in a 24 kilometre journey on a road that costs you $5 each way with potholes everywhere,
I think with all this digital economy they want to enforce on us what more control will they have on our freedom to transact our social and economic lives.

 

So, your grandparents didnt get to know you because you lived in another country?

Maybe the post war period was the anomaly.

 

Well unlike the rest of the world Australia was too far away to have a mass bombing invasion operation on its territory.
The point being made by those in the property media is that due to the expensive price of Sydney real estate that grand parents wouldn’t be able to have the usual relationship with their grandchildren because their children had to live in another region.
Needless to say the point of my original post was to highlight the economic factors that have caused the property crises and what I think should be done to correct the situation.

 

I don't think rezoning land in capitals, increasing density is the solution. A big driver for people my age to leave the city, is affording bigger land. We are moving because our kids don't fit in a 2 bedroom unit.

The goal should be to spread everyone out more, not pack is more in to the city. Any government handouts or FHB grants should be directed at this.

We _should_ be incentivising young people to go regional. We should also require immigration to be directed regionally.

 

People need to change their mindset....more 3 and 4 bedroom apartments on the way.

The nimbies in north and especially the inner west will be told to go jump

 

I just don't think there's anything wrong with leaving the cities fundamentally.

 

This is the real solution - We need more major cities. The regions need to grow.

Unfortunately our governments are not forward-thinking and continue to waste money on the few major cities we have.

My feeling is regional will end up the only option for meaningful growth at some point - Looking at regional NSW long-term. Climate may also be a large driver away from somewhere like Sydney - Penrith is frankly unliveable already.

 

Yes agreed. You are seeing a mass exodus out of Sydney..

This will affect property prices soon ...

 

One thing I've noticed in regionals is there are quite a few land releases. They are placed in the middle of nowhere and designed as though they've been crammed into the city, each lot tiny. New estates should have a minimum of 1000m2 lots.

 

Another idea would be to incentivise big corps and/or their employees to setup regional offices. .

 

I agree

 

Good points

 

kinda hard to do when the govt officials and large companies/senior management are tied up in all the commercial CBD property, to the point they require employees to go to those offices to prop up those assets.

 

Yea there's definitely hurdles to overcome in that scenario, but if the incentive is strong enough companies can slowly build a presence there.

My main point is the way government typically structures their incentives to alleviate housing issues is to either increase demand (FHB schemes) or rezone. Both of which end up making property more expensive or at least less desirable to families.

A solution should look to balance the demand all along the coastal regions.

 

Sounds just like another one of those uninformed spiels about how things were apparently better in the good old days. When they objectively actually weren't, especially in economic terms.

Sure, property was cheaper back then in relative terms, but that's because everything else wasn't. Now we literally have the world at our fingertips - cheap travel, computers, smartphones, internet - accessible for a remarkably small fraction of a working salary.

Back then, you'd be saving up for a tv or a washing machine. Probably even on laybuy.

Economically we're more well off than ever, and unfortunately there will be side effects. Expensive housing will be one, as will be more specialisation. Doesn't mean going backwards to a 1960s economy is a real solution.

 

Ahh yes, these things sure do bring about financial freedom... Let's not conflate "some things are cheap" with the economic/financial/social freedoms and certainties that home ownership [and more broadly, wealth] affords.

There's no doubt times have changed, it happens with every generation. Discretionary things are cheap - Non-discretionary is another story, and it's greatly impacting living standards these days. No need to ignore it, best to acknowledge it so we can find ways to improve/address - Tweaking arithmetic won't do anything though, there are structural issues that will take decades to work through. Ignorance is bliss, though, as is projected through so many posts on the interwebs.

 

Not everyone is suffering... It's a tail of demographics and younger cohort is the one suffering the most. The numbers have been done to death many many times before in regards to worsening housing affordability...

"...28.5 per cent of properties purchased in NSW, Queensland and Victoria last year were bought without a mortgage"

More Australians are buying properties in cash. It risks making the housing affordability divide even worse

PS: Worth visiting @Terry_w post below in regards to article above below More than one in four properties Bought with Cash?

 

Gen x and y shut out from both outrage AND sympathy.

 

well said..

We can't expect 1920's 'pioneering-spirit' in 2020s because we have a completely different society, priorities, global economy, culture and tech! If we have farm machinery to till the land and harvest the crops, we don't need the energy, motivation and elbow grease of 1920s to put together an army of men to achieve the same result - that would be silly & wasteful.

For all the noise about how we are going down the gurgler (as a nation), we couldn't be more healthier, happier, prosperous with cleaner air & with access to 10x better facilities in healthcare and education.. women's rights and awareness and multiculturalism and cheap food and access to almost everything a global citizen could dream of..

We have a quality of life and luxuries on award wage, a rich person in 1920s could only dream of!

What the OP is essentially highlighting is the determination of first generation of migrants who come to Aus from struggling economies, roll their sleeves up and make a great future without spending half their time whining about 'stuff'.. That was true in 1960s and is also true today.

Outside of that, we might not be a perfect society and nation but we are as close to the best on the planet as any could be.

We need to focus on what we can achieve and build amongst a sea of opportunities around us than wail not stop about the rising house prices and the golden days of the yore...

 

Was checking up on my older next door neighbours yesterday, originally from Malta and the subject came up. Both in their 70's now with very successful and down to earth kids. They came here in the 60s. Your post pretty much summed both of their views .

Most Australians are sheltered and have absolutely no clue how good we have it here.
Although i feel we hare heading the way of a plutocracy and we are being Americanised bit by bit... Still though, plenty of good to be grateful for and plenty of opportunities for the willing