, , , , , ,

In the hyper Australian housing market Jennifer Wells of Metro News describes real estate developer Tim Gurner’s unfortunate and thoughtless remarks about why millennials are not buying housing. His words “When I was trying to buy my first home, I wasn’t buying smashed avocado for 19 bucks and four coffees at $4 each,” were quoted  in an interview with Australian media .

“Note that in March the Australian Bureau of Statistics compared the five-year 70-per-cent increase in Sydney house prices — that’s not a typo — to average wage increases of 13.2 per cent across the same period. The median house price in Sydney was just shy of $1.2 million (Australian dollars) in April. And a local point of reference: this month the Internet-cost-of-living data base NUMBEO found that getting by in Sydney is 28.8 per cent more expensive than Toronto.”

“In Sydney, Melbourne, Toronto and Vancouver housing affordability has increasingly created a class divide. Today it’s less about earned income and more about access to capital — the inheritance, the well-off parent. “People can save, but not enough to get into the market that is always moving up. ”
In Australia the Australian Prudential Regulation Authority limited lending institutions for interest only lending to thirty per cent of all new residential mortgages. On the other hand, the Australian government announced a foreign buyer’s tax on empty houses,  as well as a way for new buyers to save funding for first purchases.
For seniors 65 and over, the Federal government has come up with a scheme to boost the householder pension if they sell their principal residence.Interestingly, the government is also trying to appeal to potential “downsizers” — home owners aged 65 and over — with a plan that would boost a householder’s pension should the homestead be sold. Freeing up housing stock is the hoped for outcome.
This housing problem is certainly not related to avocado toast or any fancy drink-but that’s a symptom of not looking at the bigger picture. Affordability, accessibility, and a range of housing types are necessary to move forward. Millennials did not create this challenge.  “And it shouldn’t be their task to fix it. If smashed avocado on toast is a comforting way to salve the disappointment of not seeing home ownership in one’s future, it’s actually a small price to pay.”