An op-ed piece in a Sydney newspaper last week divided readers and social media users. Uniquely, the author tackled the meaty issue of housing affordability, claiming bricks and mortar are now so expensive that they’re unattainable for young buyers – and that’s effectively ruining lives.
The author bemoaned how he was “sick and tired” of everything from the house search process to living in a crappy rented flat. The inability of him and his girlfriend to find a home that suited their needs, strict criteria and budget was a disaster and that he’d had a gutful.
And it was having major implications, he claimed. As well as being fatigued and nauseous, as readers were repeatedly reminded, not being able to buy their dream home had forced them to delay starting a family.
As everyone knows, you can’t raise children in a rented property.
This classic example of a first world problem is apparently the fault of baby boomers, greedy property investors, the government, a real estate sector gone mad and foreigners.
What a load of rubbish.
The totally unconvincing ‘woe is me’ tone of the piece aside, what it failed to concede but made painfully clear was the modern trend of high expectations and low ability. I hate to say it, given I am one, but it is so generation Y.
As a young couple, very much working class and from relatively poor families, my parents didn’t get their dream home when they bought property for the first time. It was some crap shack that should’ve had a match put to it. Like many Australians of their ilk, they scraped together what they could to get a foot on the ladder. From there, they worked their way up.
Similarly, I bought my first place while still at university and earning a very modest wage as an office casual. I battled to make it happen. It certainly wasn’t a dream home and although it was livable, it was cheap, smaller than I’d imagined and in a suburb I’d never been to.
But, it was within my means and achieved the goal – buying my own home. Plus, it spawned major opportunities and allowed me to expand in the world of real estate.
The implication that young people should be able to attain their dream home in a brilliant, in-demand location of their choosing straight up is cute. And sure, I would’ve loved to own that restored cottage I stumbled across as a bright-eyed and naïve first homebuyer.
But let’s be real. Stuff costs money and we don’t have an automatic entitlement to it, just because we want it. Life is meant to be challenging; we’re meant to work hard to achieve security, stability and all that good stuff.
Like a career, you’re rarely able to leap in somewhere near the middle or top without laying some groundwork. You make the best of what you’ve got and work hard to improve things. That’s life.
Buying your first home is tough, especially in the current lending climate when larger deposits are required, but it’s far from impossible. It might take a little longer and require a lowering of expectations, though. You might even have to look outside the inner city.
There’s no doubt that property has increased in value – a lot – and is deemed expensive in most capital cities. But unaffordable? No. In fact, servicing a mortgage typically requires the same portion of an average household income as it did 40 years ago. That’s around the time my folks were cracking the market.
Here’s a great analysis of the affordability argument by RP Data’s Tim Lawless.
Shannon Molloy is the deputy editor of Australian Property Investor magazine, www.apimagazine.com.au