This week, Joe Hockey said :
When asked at a press conference on Tuesday if residential property in Australia’s biggest city was out of the reach of many, Hockey said: “If housing were unaffordable in Sydney, no one would be buying it.”
“The starting point for first home buyers is to get a good job that pays good money,” he added.
If everyone gets a better job, there will be no taxidrivers, no baristas, no gardeners, no couriers, no postal workers, no street cleaners etc. OR you pay these people $365k a year Joe. Can’t have it both ways.
Housing needs to provide for ALL workers. Some cheap, some expensive. Who would live 3 hours from work and come to work in Sydney at a below average wage?
Affordability and price is not the issue. The issue is WHO can afford the price. Half the houses need to be affordable for those earning below the median wage and half above, otherwise Sydney and Melbourne will end up full of people like Joe who can’t clean their streets, so they will end up living in a slum. George Street piled high with rubbish.
Yes Joe “They are selling” – to investors and foreigners. But it’s just a bidding war that ignores the fact that people can’t make the repayments (or rent).
Advising anyone that $1m of debt tied up in a gamble on ever increasing prices is stupidity. Might as well buy $1m of lottery tickets.
A house does not add any significant value to the economy compared to $1m spent in R&D or business investment.
The rush to feed the pokie machines will, of course, end badly but only the banks will be bailed out. You will be saddled with an endless debt to the banks who used the bailout to enrich themselves. Fractional banking means the money came from out of thin air and securitisation of your mortgage ensures the banks will not suffer any loss but society will.
The historical house price average since records began, in every country recorded, is 1.5 – 3 times the average wage. Every society needs a spread of people, rich and poor. Neither can exist without the other.
The fall of the Greek and Roman empires mirrors this exactly.
Please make your way quietly to the exits before the stampede.