INDEED … but is this


HAS anyone noticed that each dwelling in a duplex development sells for the same if not more than many cottages on a half lot say 300M2 each? For say between $1,200,00 – $2,250,000

WHICH means with the commencement of the ‘Low Rise Medium-Density Housing Code on 6 July 2018 (last year) in many council areas across NSW … developers have been landbanking our cottages … for not only duplex but triplex, rows of terraces, townhouses and Manor Houses …

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HOW long before High Net Worth from Hong Kong, India, Indonesia … across Asia return to this market?

THE Scomo Govt exempted Real Estate Gatekeepers from Anti-Money Laundering Rules in October 2018 …

AND high immigration has been maintained through the backdoor of Visa manipulation when they buy our real estate …

MEANWHILE Australian ‘aspiring’ First Home Buyers are unable to purchase the exiting homes of BOOMERS with a young couple on incomes of $70K each they can only attain a mortgage of $450K … the entry level of houses will need to drop from $800K to $450K!

OR will ‘The Plan’ backfire with a recession where house prices fall … unemployment will grow … then will immigration fall?

WHERE will ‘The Plan’ lead? Will it lead to recession, high unemployment, families homeless, investors wiped out … Depression?


The house price battle that must be fought

Shane Wright
Shane Wright

Senior economics correspondent July 9, 2019

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An economist friend of mine put the recent slip in housing prices into some perspective. 

“We’ve gone from housing that is OMG unaffordable to simply stupid unaffordable,” he noted soon after CoreLogic reported house values in Sydney and Melbourne had inched up through June.

Among all the angst and concern over the recent fall in prices across our two largest cities, between 11 and 15 per cent since 2017, what’s been forgotten is that by any standard they are still bloody expensive.

Through the roof ... while prices may have fallen in recent times, they have merely shifted from OMG unaffordable to stupidly unaffordable.
Through the roof … while prices may have fallen in recent times, they have merely shifted from OMG unaffordable to stupidly unaffordable. CREDIT:ROB HOMER

*The median house price in Sydney is a touch under 11 times median income while in Melbourne it’s almost 10. In a global ranking of expensive cities released earlier this year, all of Australia’s major capital cities were among the top 20.

Before you start waving a walking stick around and complaining about young whipper snappers never having it so good, go back to the 1990s when the income-to-price ratio was about half what it is now.

*Since 2011, and even after the recent correction, home values in Sydney and Melbourne have climbed by more than 50 per cent. Over the same period, incomes (as measured by the wage price index) increased by between 19 and 21 per cent.


Up to a third of homes in parts of Melbourne and Sydney are being sold at a loss with the rate likely to climb higher.

The Sydney and Melbourne suburbs where up to a third of homes are selling at a loss

To make up the difference between wages and home prices, those mortgages have got larger and their repayment time longer.

*In 1996, 41 per cent of Australians owned their home outright while 26.5 per cent had a mortgage.

*By the 2016 census, the proportion owning outright had fallen to 31 per cent while those with a mortgage had reached 34.5 per cent.

The combination of higher home prices/larger debts has also meant fewer younger Australians are getting into the property market while there has been a rise in the number of people approaching retirement holding substantial mortgages. This is a demographic and economic timebomb for which no one has a proposed an answer.

Instead, the focus is on the economic here and now with a dash of political smoke.

The economic worry is what falling house prices mean to jobs, inflation and overall GDP.

As home prices have fallen, there’s been a definite cooling in the job-heavy retail and construction sectors at a time when the Reserve Bank is trying to engineer an increase in wages via a tightening of the jobs market.

In the final week of the election campaign, Prime Minister Scott Morrison unveiled a policy aimed at making it easier for young people to get into the property market. The government plans to borrow about $500 million which will act as a guarantee for the mortgage insurance facing 10,000 first-time buyers a year.

Morrison said this would help young Australians get “their first leg on the first rung of the ladder”.

Almost exactly two years earlier, Morrison, as treasurer, announced in the 2017 budget plans to deal with housing affordability that included the thoroughly underwhelming policy to enable first-time buyers to tap extra savings put into their superannuation account.



After two years of pain, the property slump looks to be over

This was another way to give people more money to buy a home  that, like the election housing policy, has the perverse result of bidding up prices.

Of course, the other way for young people to get into the property market is to have housing that is neither OMG unaffordable nor stupidly unaffordable.

That would require home prices falling even further – or not growing at a Golden Slipper-like clip for a few years – and wearing the short-term economic pain for resetting the market at something approaching common sense.

But so addicted as a nation are we to ever-increasing home prices that this cannot be countenanced.

We’ve got ourselves into a position where even a correction in home prices means end of days for the economy but a boost in prices – a boost for our retailers and general economy – means more and more young Australians taking on huge debts to own a property if they can even manage that.

It’s an inter-generational pact where only one side loses.

Debt and affordability concerns get kicked down the line, as they have for the past 25 years.

This failure to properly deal with affordability also means our regulators have to contort themselves when it comes to major policy changes.

RBA governor Philip Lowe, after the bank’s most recent cuts to official interest rates, has had to explicitly downplay the “threat” that the moves may lead to a sharp uptick in prices. (Property spruikers, however, were quick to talk up the chance of a bounce.)

Announcing changes to lending standards for the nation’s banks last week, APRA chief Wayne Byres noted that a breakout in dodgy lending was unlikely given the combined issues of high household debt (due to our super-high home prices) and subdued income growth.

That the chief banking regulator had to defend a loosening in lending standards on the basis that Australians are carrying debts that would weigh down Game of Thrones’  Ser Gregor Clegane points to the wicked situation the nation finds itself in when it comes to home prices.

There’s also that other bank – the bank of mum and dad – that is increasingly exposed as it gets called upon to prop up our over-priced bricks and mortar.

At some point, perhaps when prices go beyond the OMG unaffordable point, a real discussion about this nation’s housing obsession, and the problems it is creating, is going to be had.

Shane Wright is a senior economics correspondent.

Shane Wright

Shane is a senior economics correspondent for The Age and The Sydney Morning Herald.