Your Thoughts on The Rental Crisis?

Sydneyswans on 15/10/2022 - 23:34

Hey guys sorry if I sound oblivious to the rental crisis situation affecting Australia because I haven't seen it first hand and I live in Sydney.

Just this month A friend and partner fully employed (Govt roles) finding an apartment in less than 2 weeks after selling the apartment they owned whilst awaiting construction of their dream home. Myself finding a four bedder a year ago within a month of looking mid covid19 mind you but 3 occupants fully employed plus children. For those looking and struggling I feel for you… I think the WFH situation has changed the way we live and made some parts of regional Australia unaffordable. Wish there was something I could do.

For those renting how long did it take you to find a place and how is your situation? How is the situation in your town or suburb? What should the governments do to alleviate the situation.

Home & Garden

Comments

- - - shutuptakemymoney101 on 16/10/2022 - 22:23
      
      +1
      
      Guaranteed political suicide for any party who tries to bring it in though ;-)
  - BHR on 17/10/2022 - 08:13
    
    -2
    
    That’s a fantastic idea! I’d vote for a room tax. People might then move to a right sized property.
- tsunamisurfer on 17/10/2022 - 11:50
  
  In WA Land Tax applies to empty AND tenanted properties that are not PPOR.
LoserScott on 16/10/2022 - 18:08

It's life now, we had 3 years to prepare during and before pandemic, and that's not including property but things that chocked the life out of every manufacturing chain, and business…

Next it'll be fuel scarcity, but houses need to be atleast 125,000 per year or otherwise it's a pipedream.
dave999 on 16/10/2022 - 18:13

+7

These posts have been done multiple times with lots of anti investor rhetoric but it is known what needs to be done, it just gets lost in all the negative gearing, capital gains anti investor nonsense.

What needs to happen is to change demand and supply.

On the supply side it is:
- Make building on existing and greenfield sites quicker and cheaper.
- Remove stamp duty
- Remove the ability to ignore your house when assessing assets related to retirement
- Better transport (especially public transport) to more areas.
- Make building cheaper
- Create good jobs outside of capital cities

On the demand side:
- less immigration (not saying to do this but the only way to reduce demand is to reduce the number of people)

Talking about negative gearing is so counter productive precisely because it will achieve nothing - it is like rearranging deck chairs on the titanic while it is sinking. The conversation should be about things that would actually make a difference. And just to be clear I don't negative gear and never have.
baskinghobo on 16/10/2022 - 20:20

+3

I don't understand how in 2022 we as a society fail so badly that there aren't enough houses for people to live in especially in a first world country like Australia.
- OzzyOzbourne on 19/10/2022 - 12:54
  
  It's intentional policy to keep the prices going up
- Ghost47 on 20/10/2022 - 16:14
  
  Because the LNP was in charge the past 10 years.
  
  This is now the status quo.
- pogichinoy on 20/10/2022 - 18:32
  
  There's enough housing, but not at the prices people want.
  - baskinghobo on 20/10/2022 - 19:27
    
    That's not really a fair statement though. Of course people can choose to look for higher priced rentals if the lower priced rentals are too difficult to get approved for but that will also mean they are more likely to get rejected due to their lower income even if they can afford it
    - pogichinoy on 20/10/2022 - 21:50
      
      Not at all. What you are looking for is price/rent control which is not letting the market run its due course.
      
      If the higher priced rentals are not meeting market demands, LLs will have to drop their asking rent or else they'll continue bleeding money each week.
shutuptakemymoney101 on 16/10/2022 - 21:30

-1

Public housing isn't utilised as it should be, when the kids leave a single of couple still get to live in a 3 or 4 bedroom house when they could be downsized to a unit allowing another family in need to take the house.
nikey2k27 on 16/10/2022 - 21:58

public house over 65 social house project pay for with superfund and other in investor and few 3 to 4 bedroom done NRAS style system social house project should rent like rental in private market too day you rent this have be kick them gold if you will made homeless again hand up not hand out. i live in public house for 9years glad to own my own home but gladly rent from social house project home.
nikey2k27 on 16/10/2022 - 22:03

-4

WE Are Aus we pay high tax to so our family should be homeless live in Tents as landlord of unit block told stop sent applied you plz pick sent me 15 people read their story make want try be rich so buy 15 more unit. Family should not be homeless in Aus WTF wrong with the system.
- jellykingdom on 17/10/2022 - 09:04
  
  +4
  
  This commenter is so poor and downtrodden, he can't even afford punctuation or grammar
  - LoserScott on 18/10/2022 - 22:11
    
    -2
    
    Nice way to judge, keep up the good work.
IM-Cheap on 16/10/2022 - 23:26

+6

More apartments and better quality. We would not hate apartments so much if builders were less shit, the building standards higher and more defined, more independent checks mandated and better consumer protections offered.

I think gov should encourage more redevelopment of old commercial spaces near public transport into high density mixed commercial/residential. Stations on the western line to mind - low density shops right next to a station that could be further developed.
- p3nf0ld on 17/10/2022 - 00:01
  
  +1
  
  Erm, we don't need more apartments. COVID and WFH has seen people move out of city apartments to cheaper alternatives further out. Apartments are the last thing we need.
  - IM-Cheap on 17/10/2022 - 11:51
    
    +3
    
    People moving out to regional towns and fringe capital cities with WFH situations is what is pushing rents & prices in those areas sky high making it unaffordable for families that were getting by previously.
    
    Lack of accepatance of units in the city is what is pushing the price of homes in the city up and driving out WFH. If we can improve the design and quality of high density living more people will want to live in them - apartment living doesn't have to be shit and can offer alot in terms of convenience.
  - [Deactivated] on 19/10/2022 - 20:01
    
    From speaking with several people that did move, one common factor seems to be apartments nearly everywhere being designed like crap and borderline shoeboxes. And the minority apartment buildings that did have building standards maintained were ridiculously expensive. Many of them would have stayed in apartments if they were decent, some purely for the additional security.
- Thaal Sinestro on 17/10/2022 - 05:09
  
  Recently built apartments are terrible. Really small, no storage, no personality, saometimes even no car storage. That's why so many people instead want to live in a townhouse or detacted house.
CalmLemons on 17/10/2022 - 00:09

Honestly it seems everyone on here seems to forget when the government forced landlords to discount rents during covid even and now they complain when landlords jack up the rent or don't want to rent anymore.
- JimB on 19/10/2022 - 11:21
  
  +1
  
  Government never forced landlords to discount rent, they asked landlords to 'consider' it and also stopped landlords to from evicting tenants due to non-payment of rent.
duluxe2000 on 17/10/2022 - 02:01

My personal experience in my suburb and surroundings (Sydney metro) that price is back pre-covid level. It's hot, sure, but I'm not sure if it's a "crisis". People are bidding high price for rental because they can afford it. It's like inflation, after years of lockdown, people have cash, working from home means they save money from transport and lunch and have more money to flash into things like a new TV, nicer rental (which is important to WFH). I know some people used to join with others to rent but now they prefer to have their own (rental) places.

Regional area I think is different story. Limited housing means sudden changes in demand won't be able to meet (i.e. city people flocks to regional). Let say we build lots of properties in regional, what if the life style changes?

Unfortunately I don't have any solution.
- Thrawn on 17/10/2022 - 11:14
  
  +3
  
  I've just purchased a new property in Sydney and have been looking at historical rent/sold prices for individual properties in the area.. I see rents were about $400 in 2013, around $500 just before Covid. $400-$450 during Covid.. and now around $500 to $550.
  
  10 years to achieve rental increase of about 30%… that's below inflation
  
  The increases in strata costs and tradie maintenance costs alone is a lot more than 30%
  
  I guess over a decade renters got used to very soft rental increases due to interest rates dropping. Interest rate hikes combined with withdrawal of covid pricing caused a big shock. But IMO it's well overdue for a catchup
  
  Also, whilst looking around the market for new property.. I see very little investor interest. In fact a lot of investors are selling out. The property I purchased is from an investor and we're going to be using it for ourselves. The demand I'm seeing is mostly from retirees downsizing and young couples.
devoker on 17/10/2022 - 02:20

+3

Even some very old houses in some suburbs (Sydney) starts at 1.5M$ and some of them were bought 10 years ago for less than 300K. None of these houses should be worth so much, but there are 2 different forces driving the prices upward, not enough supply and very high demand. If the government can't help to control one of those you can't make housing affordable. Either they need to disincentivize investors by increasing taxes progessively to own multiple houses and decrease the demand, or subsidize building so many apartments that the first homeowners can have much cheaper alternatives to have, thus increase supply. Even though they increase supply, if they can't control the demand of property investors most of the new units will be bought by investors and it will also drive prices upwards or at least won't let them drop.
- dave999 on 17/10/2022 - 09:30
  
  "Either they need to disincentivize investors by increasing taxes progessively to own multiple houses and decrease the demand". This would not decrease demand is any way whatsoever - there would be the same number of houses and the same number of people.
  - [Deactivated] on 18/10/2022 - 23:24
    
    The same number of people, but the people are not equivalent. If you remove the wealthiest people from the pool of demand, the average incomes of the pool of potential purchasers drops. Hence prices will drop.
    - dave999 on 19/10/2022 - 11:49
      
      +1
      
      You are not removing the wealthiest people. You seem to believe wealthy people deliberately overpay for property and deliberately make huge losses - people don't become wealthy doing that, they become wealthy by doing the exact opposite.
      - [Deactivated] on 19/10/2022 - 12:18
        
        @dave999: If people who own multiple homes are encouraged to sell them, the remaining prospective purchaser's own 0-1 homes. It isn't a stretch to assume that people who don't already own property will be relying on their borrowing power only.
        
        You seem to believe wealthy people deliberately overpay for property and deliberately make huge losses
        
        There is no such thing as overpaying, the value of a property is the price paid. People with more money will be able to out bid people with less money. If the average incomes of all the prospective purchasers is reduced, across the market the prices of property must fall - the price is determined by the people buying not by the sellers. You seem to have a very basic concept of economics based on commodity goods which you are trying to apply to real estate.
        
        People who are bidding on a home priced in the millions will not be borrowing the entire amount.
        
        Instead of always thinking of exceptions, think about how these changes would affect the average purchaser.
        
        dave999 on 19/10/2022 - 12:45
        
        @[Deactivated]: "Instead of always thinking of exceptions, think about how these changes would affect the average purchaser." - I would suggest that is exactly what you are doing - you can't see the big picture, you think change one thing (negative gearing) will not change anything else. It will set off a chain of events that result in no change in prices.
        
        I personally get no benefit from negative gearing, I don't use negative gearing. But removing it will achieve no reduction in house prices. You are using a lot of words to try to connect removing negative gearing and a drop in prices but it is mostly just gibberish.
        
        As I have said before:
        "These posts have been done multiple times with lots of anti investor rhetoric but it is known what needs to be done, it just gets lost in all the negative gearing, capital gains anti investor nonsense.
        
        What needs to happen is to change demand and supply.
        
        On the supply side it is:
        - Make building on existing and greenfield sites quicker and cheaper.
        - Remove stamp duty
        - Remove the ability to ignore your house when assessing assets related to retirement
        - Better transport (especially public transport) to more areas.
        - Make building cheaper
        - Create good jobs outside of capital cities
        
        On the demand side:
        - less immigration (not saying to do this but the only way to reduce demand is to reduce the number of people)
        
        Talking about negative gearing is so counter productive precisely because it will achieve nothing - it is like rearranging deck chairs on the titanic while it is sinking. The conversation should be about things that would actually make a difference. And just to be clear I don't negative gear and never have."
        
        [Deactivated] on 19/10/2022 - 12:50
        
        @dave999: If you discourage the wealthiest people from investing in property, they will invest their money somewhere else. That is textbook less demand.
        
        Explain the rearranging of the deck chairs. Remember all the people with first class tickets are no longer on the boat now.
        
        dave999 on 19/10/2022 - 13:09
        
        @[Deactivated]: "If you discourage the wealthiest people from investing in property, they will invest their money somewhere else. That is textbook less demand." - Less demand for what? You seem to be so confused as to what the market actually is.
        
        "Explain the rearranging of the deck chairs. Remember all the people with first class tickets are no longer on the boat now." - Is that meant to be a joke, or just an unintelligible comment?
        
        I don't know how much more simply I can put it to you for you to understand? Your belief that removing negative gearing will result in lower prices seems to be grounded in nothing but "faith".
        
        It is simple, there is demand (home owners and renters/investors) and supply (properties).
        
        There will always be renters, many people have no desire to buy a house and be locked into a single location or not be able to afford to buy where they want to live. As there will always be renters, there will always be a need for investors. Increasing tax on investors ultimately just ends up increasing rents as the renter is the demand - they need somewhere to live.
        
        As I said above, the way to reduce house prices is to increase supply, which can be done but isn't because the government takes in so much tax revenue from stamp duty, Land Tax and Capital Gains Tax - and these are linked to the price of properties. It also doesn't help that so many people are fixated on negative gearing that derails any real conversation on actions that would actually reduce house prices.
        
        [Deactivated] on 19/10/2022 - 13:19
        
        @dave999: I agree with all your other points.
        
        You have never explained how removing negative gearing will have no impact on prices. I simply have to accept thats it's true?
        
        Not all renters want to rent. That is not logical. In the same way that reducing the return on real estate will have "no impact" on prices due to "rearranging deck chairs" is not logical.
        
        I assume you read this somewhere and cannot replicate the reasoning.
        
        dave999 on 19/10/2022 - 13:58
        
        @[Deactivated]: "You have never explained how removing negative gearing will have no impact on prices. I simply have to accept thats it's true?" - It does not change supply or demand - therefore prices will not change. It's written in black and white, many times above, you just choose to ignore it. Do I need to repeat it ten more times.
        
        "Not all renters want to rent." - never said that.
        
        "In the same way that reducing the return on real estate will have "no impact" on prices due to "rearranging deck chairs" is not logical." You obviously have no idea what that well known statement means. It means you are changing things that have no connection to the actual issue at hand. Removing negative gearing doesn't reduce the return on real estate, it increases the cost, which would be passed on the actual consumer, which is the renter. An investor is really no different to a bank, just a different financing model, the demand (or consumer) are the home owner and the renter who are competing for a place to live (the supply).
        
        "I assume you read this somewhere and cannot replicate the reasoning." - I know exactly what I'm talking about and am explaining it pretty simply to you, you just refuse to take anything on board. I'll say it one more time, you seem to have a belief that by changing one thing, in this case negative gearing, nothing else will change, that there will be no other changes to the system. If this was the case you would be right, it would reduce prices, but there is nothing stopping flow on effects from removing negative gearing - such as increasing rents. This is where your argument falls down completely. It does not change supply or demand - it will not change prices. The other things I mention above would definitely change supply and demand and would definitely reduce prices.
        
        [Deactivated] on 19/10/2022 - 14:23
        
        @dave999: Now that I understand your point of view I am able to point out where we disagree
        
        there is nothing stopping flow on effects from removing negative gearing - such as increasing rents.
        
        Yes there is. The price of rent is limited by what renters will pay. That is why rents have not kept up with property price growth across over two decades now. You missed that point completely. I understand what you mean by "rearranging deck chairs", it doesn't add up.
        
        dave999 on 19/10/2022 - 14:39
        
        @[Deactivated]: "Yes there is. The price of rent is limited by what renters will pay. That is why rents have not kept up with property price growth across over two decades now." - You keep bringing up complete red herrings to what sets the price of properties. Yes, there is a limit to what renters can pay, that means nothing because there is a limit to what home owners can pay, there is a limit to what investors will pay. Removing negative gearing changes the balance but it doesn't change the price. There is the demand of the homeowners and renters competing for the finite supply of properties - that is what sets the price.
        
        I could go into the whole other topic of why rents have not kept up with property prices, but it has nothing to do with removing negative gearing affecting property prices.
Shane034 on 17/10/2022 - 07:05

+8

Remove negative gearing and ban the cancer that is Airbnb in any areas with low rental availability. I live in a coastal town with critically low rental stock and there's empty short stay rentals and holiday houses on every street.
I know people born here sleeping in cars. So wrong.
- downbythecreek on 17/10/2022 - 07:32
  
  +6
  
  I have an Airbnb a few houses down from me, it's a really large house that is used for big parties almost every weekend. I don't know why this garbage is even allowed in a zoned residential area, it shouldn't be.
  - [Deactivated] on 17/10/2022 - 08:14
    
    +1
    
    This is an excellent point, it's literally no different to a hotel, but a hotel would not be allowed to operate in your residential zoned area.
- [Deactivated] on 18/10/2022 - 14:49
  
  +2
  
  We have homes locally renting out for up to $900/night in Airbnb. Meanwhile, families with two working parents are being forced to uproot their kids and careers to move away because they can't get a rental. It's awful.
  
  I agree with the point about these hotels being allowed to operate without restriction in a residential area - it shouldn't be allowed, or should be severely restricted to a set number of nights per year.
ratman on 17/10/2022 - 08:21

-2

I thought I'd like a change so went looking for a place in inner sydney. First day out saw 5 places, applied for 2 and got offered both. They were below market rates closed to last time I moved 8 years ago, and the second one even offered to drop the rent another 50 if I took it (from 670). In my limited experience, no rental crisis in Sydney.
- letmecry on 17/10/2022 - 10:36
  
  My experience for the fist two weeks in Aug when looking for a new place, there were around 8-10 groups inspect the place and my applications were not successful.
  But then on week 3, there were a lot less people to inspect a place and all my applications got accepted.
  
  Sadly, I signed on the first property that I got a response. It's good but some were better.
jellykingdom on 17/10/2022 - 09:02

+2

I get really confused by the rental crisis. Firstly there are too many apartments built/everyone is moving to regional areas due to WFH and not enough migrants/student/people to live in them, and it's a crisis. Fast forward a few months and now there's historically low vacancy rate, rent is skyrocketing, people are living in their cars. These 2 situations can't exist simultaneously
- letmecry on 17/10/2022 - 10:38
  
  Same here. I believe there are a lot of vacant properties that not actually in the market.
  
  I heard that they purpose a property tax if it has been vacant longer than 6 months in QLD & expect 10-20,000 properties will be in the market either selling or renting
lastdawn on 17/10/2022 - 10:17

+1

why do people really think the rents have gone through the roof in the last 1.5 year or so? Sure there are some greedy rental providers but the majority has been due to the increase interest rates, ridiculous government legislation and tenants who take any opportunity to throw the book at you.

Victorian government thinks they are doing tenants a favor by providing all these new legislations but ultimately all it does is force rental providers to increase rent. After all, it's an investment, a business.
- gromit on 17/10/2022 - 11:39
  
  don't forget the government slamming us with increased land taxes/rates, increased tradie costs for any maintenance, increased insurance costs. They all need to be passed on to the renter.
  - lastdawn on 17/10/2022 - 12:10
    
    -1
    
    it's funny how tenants don't see that aspect at all. They want to make sure the compliance checks are done regularly, all issues are resolved within 14 days regardless of the cost (express work requires higher costs) etc.
    
    Fantastic, I'm all for it, enjoy the rent increase every year lol
Tiredman on 17/10/2022 - 10:21

+1

It is a nightmare getting anything approved by councils. Planners at the council like to play architects and landscape architects despite clearly being understaffed, nitpicking everything. Took us more than a year just to get some townhouses approved by Manningham Council. Not easy to get new stock onto the market. Now massive queues for renters looking for properties.

Also not helped by builders dropping like flies in the market so builds are moving at a snail's pace.
- cannedhams on 18/10/2022 - 23:29
  
  And thats the correct answer.
corvusman on 17/10/2022 - 11:07

According to Census 2021 data:

Greater Sydney

People 5,231,147
Families 1,380,176
All private dwellings 2,076,284
Average number of people per household 2.7

https://www.abs.gov.au/census/find-census-data/quickstats/20…

There is clearly no shortage of dwellings in Sydney, it's a pure affordability issue.
Bluto Mindpretzel on 17/10/2022 - 12:04

+9
The causes:

Rampant immigration (highest in the western world) hiding behind a "skills shortage" headliner.

Relatively near zero investment in services, infrastructure forcing everyone to crowd in towards city centres.

Too many "mum and dad" property developers, millions sucking on the teat of negative gearing, media reports of property as a one way bet.

Interest rate hikes "nobody saw coming" resulting in these amateur landlords having no choice but to pass the difference in full to the renter.
Fuego on 17/10/2022 - 12:45

Seems to be a lot of financial illiteracy in this thread.

Supply was never the issue. It's the inflation of property prices and increasing interest rates that have caused landlords to panic and raise the rent.

The whole 'supply and demand' argument is just a flat out lie told to make property seem like it's actually worth the hugely over-inflated prices they are.
- CheapWrangler on 17/10/2022 - 14:37
  
  If there happened to be a million new houses built all over Australia tomorrow, you think it would have no effect on the cost of houses on the market now?
  - Fuego on 17/10/2022 - 15:07
    
    -1
    
    The demand is speculative. Doesn't matter if it was a hundred or a million new houses, speculative investors will buy up the market.
    - dave999 on 18/10/2022 - 11:32
      
      +3
      
      I know you believe it, but it complete nonsense. Anyone who pursued that would bankrupt themselves. People are taking on debt, with interest payments to purchase property. That is not possible if there is no return - you just go bankrupt.
      - Fuego on 18/10/2022 - 15:25
        
        -2
        
        @dave999: On the expectation of speculative gain…
jaimex2 on 17/10/2022 - 12:51

+9

Just going to say it.

The country voted for the party that would ignore the problem over and over. Here we are.

Reap what you sow. How good is Australia, etc.
- Bluto Mindpretzel on 17/10/2022 - 16:48
  
  To be fair, both majors are barely any different from each other in practice.
  - jaimex2 on 17/10/2022 - 17:13
    
    +5
    
    Because they get punished any time they try and bring in change.
    
    Housing affordability and availability was a key policy in 2017 and 2019 election run ups. They ended up going with "were not touching it because clearly no one wants us to" this time around.
    - Bluto Mindpretzel on 17/10/2022 - 17:51
      
      +3
      
      Yep that is true, however they took no time to turbocharge the migration ponzi scheme that is going to reap havoc on the rental crisis unfolding.
    - bobolo on 18/10/2022 - 10:39
      
      So….perhaps that would suggest that the vast majority of Australians don't actually have an issue with housing affordability and vote accordingly?
      - JH100 on 18/10/2022 - 11:42
        
        @bobolo: It might suggest people don't actually know what they are voting for.
        
        Or, no matter what people think they are voting for they always get screwed.
        
        Because people are voting for a bunch of career politicians whose perception of 'the common good' is not the same as those people.
        
        And the content of this thread is a good example of how politicians (and business people) get away with it. People don't really know what they are talking about, because they have been fed and consume a bunch of BS.
        
        The only problem with housing is it has become an 'investment' for some people who expect and demand an increasing return from the rest of the people.
        
        Return housing to 'a need for shelter' and the problem is solved.
        
        End of … :-)
        
        bobolo on 18/10/2022 - 14:44
        
        -1
        
        @JH100: That is incorrect.
        
        The content of this thread and the media is not a representation of reality. I would say most Australians are not affected by any type of "crisis" as they may have owned property for a while or are renting just fine.
        
        Housing is definitely a "need for shelter", and in a capitalistic society there are 2 ways to obtain that shelter. By using money to buy a place, or by using money to rent a place. The price to buy and rent moving up or down is an extremely complex matter, but if there were no investors, there would be no ability for people to rent properties and the housing crisis would be far far worse
        
        You are making the assumption that people have no actual preference as to where they live. I maintain there is no "housing affordability crisis". We have an "expectations crisis" instead. Everyone wants to live in the fancy, trendy areas, in nice large homes with a backyard. Well guess what? They cost a lot more. If it was up to you we'd all be on Bondi Beach somehow or waterfront mansions in the Eastern Suburbs. How would that be possible?? There is plenty of well connected, affordable housing in all major capital cities in Australia. People (especially younger generation) just don't want to live in them because it may be too embarrassing or they don't want to compromise.
        
        JH100 on 18/10/2022 - 14:51
        
        @bobolo: Each to their own …
- Shane034 on 18/10/2022 - 07:34
  
  +1
  
  Both major parties are ran by those with a vested interest in keeping prices high. And their voters don't want their Ponzi investments to go back to normality either.
ItchyBallsack on 17/10/2022 - 13:01

+4

If i could WFH i would move to a rural area so its cheap
ItchyBallsack on 17/10/2022 - 13:03

-3

And government should mandate a rent freeze
- drfuzzy on 18/10/2022 - 17:33
  
  Who is going to pay the rising costs for landlords if rents are frozen?
OzzyOzbourne on 17/10/2022 - 14:03

+7

Ignoring the policies which have pushed house prices higher and higher, putting a house purchase out of reach for many….Regarding finding a rental, I've never had an issue finding one in Melbourne outer Western suburbs near a train station, in around 2 to 4 weeks. Currently paying $330 pw for a large 4 bedroom house on 700sqm.

I've never been interested in living in the inner suburbs or cbd. Too many people and traffic

I recently read an article that the government gives more money back in tax refunds to property investors than they spend on innovation and new business incentives.

Property investment adds nothing to the productivity and output of a country.
- jaimex2 on 17/10/2022 - 17:16
  
  +6
  
  We love selling expensive dirt to each other.
  
  Whats even more messed up, high interest rates = Investors heavily tax deducting their losses while upping the rent.
  
  win win.
  
  How good is Australia?!
  - Shane034 on 18/10/2022 - 07:43
    
    +3
    
    100%. The country's whole culture of seeing housing as the main investment product rather than shelter for citizens is sick indeed.
cheapanddirty on 18/10/2022 - 06:44

+2

Not popular opinion here probably, but it’s pretty simple why people are worse off…
As inflation rises, the central bank pulls the brakes on the economy with the rise of interests rates.
That means everyone is meant to be feeling the pinch! If people are compensated for all the resulting higher costs and lower income, inflation would never drop.
Why do only house owners need to spend less? That burden should be shared by everyone, including renters.
I feel for people seeing their costs rise or being unable to obtain a property at all due to shortage, different issues, but the affordability issue is meant to be there so the economy cools down.
- drfuzzy on 18/10/2022 - 17:35
  
  You are injecting logic and an understanding of economics into the conversation.
  Many commenters here are just wanting rents frozen and housing prices and rents to drop without understanding the consequences.
bobolo on 18/10/2022 - 09:50

+2

The number 1 problem with the "housing affordability problem", be it buying or renting is: people (especially young people) have an unrealistic expectation of where they want to live. It is normal, even in past generations, to compromise on your first/second home in suburbs further out, and, if you are smart/take risks that pay off, eventually upgrade to more desirable suburbs.

Secondly, these "outer suburbs" gentrify from working class to become the new middle class/premium area. It was not that long ago in Sydney where the entire Inner West was considered a slum for working class peasants. Until recently, the Hills District experienced the same type of gentrification

But nope, everyone wants to live in trendy, upmarket suburbs close to the city in character homes - and instead of working / compromising for it like older generations, they go online and whinge about how they don't get it NOW!
- Yamun121 on 18/10/2022 - 10:42
  
  +1
  
  exactly!!! I myself know my parents made this decision, and dad had to drive upto 90min to work
- fusion17 on 18/10/2022 - 12:07
  
  +3
  
  They also want a nice car, holidays getaways and Ubereats.
- tonka on 21/10/2022 - 04:36
  
  +1
  
  I've seen first homeowners borrow an extra $50K, just to replace perfectly good kitchens and bathrooms with their preferred options. Then complain about the mortgage affordability. Meanwhile I still buy second hand furniture.
eek on 18/10/2022 - 11:22

Landlord perspective: Tenancy agreement about to end in 3 months time - reassessing situation and looks like current rent they're paying is about $40/week lower than current market as I haven't adjusted their rent in 18 months. I will be increasing rent this time, as my costs have gone up and I'm not a charity. Tenants have always been good, take good care of the house and I've always approved maintenance and repairs instantly. This is for a 3 bed, 2 bath freehold house on 650sqm land about 13km from Brisbane CBD.
ju2au on 18/10/2022 - 14:08

+1

I am no expert in this area but the problem must lie somewhere in Government Policy (market forces is strongly influenced by Government so it falls under this umbrella).

In terms of landmass, Australia is the 6th largest country in the world, behind behemoths such as Russia, USA and China yet it has only a very small population by world standards. Our current population is currently around 25 million. Put it into perspective, China's city of Shanghai has the same population of 25 million people, Taiwan has around 24 million people and that island is only about half the size of Tasmania.

I understand that Australia is mostly desert in the middle but putting everything into perspective, we still have plenty of land to build on. This issue seems to be a lack of housing construction. I came to Australia in the 1980s when the population was around 15 million people. Seeing with my own eyes, the number of buildings/houses/apartments have certainly increased over the past 40 years but probably not enough to house the extra 10 million people that we have now.
- OzzyOzbourne on 18/10/2022 - 14:28
  
  +1
  
  If you build enough houses, then their value won't increase so quickly, which means there will be less stamp duty, government officials and other property investors won't gain so much on their investment and banks won't make so much money…..in other words, it's not going to happen.
  
  Land is not the problem, it's government policy
- bobolo on 18/10/2022 - 15:48
  
  +1
  
  It doesn't matter how much land we have. People only want to live in tiny tiny pockets. This is the crux of the problem. People's expectations and their willingness to compromise have changed. And instead of working towards it like people used to, they rather have a whinge and cry poor. They don't even want to entertain living 30kms outside of a CBD anymore.
  - [Deactivated] on 19/10/2022 - 00:27
    
    +3
    
    Living 30km out of the CBD in Melbourne or Sydney means 3 hours spent commuting each day. Even then, you don't get leafy streets and a nice yard for your dog, you get townhouse built on half a block with no space outside. The suburb has poor local infrastructure and everything you want to do requires a long drive. This was not what the previous generation faced when they moved out to the cheaper area.
    
    Some people are compromising by moving to regional centres, but for many people their work requires them to live in cities.
    
    Instead of assuming everyone is a millennial stereotype, consider that an Australian city in 2022 is not equivalent to an Australian city in 1982.
    
    When new suburbs are divided up and sold, have a look what is on offer - blocks as small as 250sqm, no street parking, and courts that feed all traffic into one strained arterial road ensuring every day of your life begins with a traffic jam.
    
    If people want what a working class family could have one generation ago, they need to spend between 1 and 2 million dollars, it is out of reach for the average person, let alone a low income person
    - bobolo on 19/10/2022 - 13:08
      
      -1
      
      Umm…yes it was.
      
      I grew up in the Hills district in Sydney when it was basically farmland late 80's/early 90's with brand new H&L packages. Almost exactly 30kms away. The house we lived in was 30 years old at the time
      
      Back then it was mostly young professional families starting out in the burbs because they couldn't afford the "ritzy" North Shore.
      
      Parents had to commute over an hour each way (door to door) and trains to the city were once every 1/2 hr during peak hour. Had to drive 20 mins to the station and find parking near the station as well. This was during a time when there where Nokia's weren't invented let alone smart phones
      
      Some families stayed but plenty moved up in the world whether its the corporate ladder or venturing into small businesses - and the ones who found success moved to more premium/nicer areas closer to the coathanger
      
      If I run a search on Liverpool/Fairfield/Blacktown/Campbelltown LGA's, plenty of affordable family houses on large land (based on average incomes) for both buyers and renters.
      
      Like I said - nothing has changed - only people's expectations on wanting "the life" now.
    - pogichinoy on 19/10/2022 - 17:41
      
      +2
      
      I don't understand why we have to keep comparing to the previous generation or a previous generation.
      
      Why are people expecting things to remain the same?
      
      The population, economy, etc is in perpetual growth, even if its a few % each year, so why are people expecting things to remain the same such as having the same affordability?
      - bobolo on 19/10/2022 - 22:29
        
        +2
        
        @pogichinoy: Exactly. As a result of population/economy/perpetual growth, its only reasonable to expect that property becomes more expensive over time.
- catbug on 19/10/2022 - 11:30
  
  +2
  
  the issue in Australia is we don't have more cities, in The Netherlands I caught a train for 35 minutes from Amsterdam and I was in another state! We are a huge country that is built around 5 major cities with some regional centres like Newcastle, Bendigo and Geelong. Australia needs more public transport infrastructure to make it feasible and attractive for people to want to live outside of the cities.
  
  The problem is not young people having crazy standards and are not willing to live out of the city, they will buy houses there if there was good infrastructure and amenities. Just because they're young and starting out doesn't mean they want to or should live in a crappy area with over crowded/under performing schools, bad traffic and not a lot of choice for lifestyle access (gyms, medical centres, hospitals, parks etc).
  
  This all comes down to government and council planning. They need to build up areas outside of the cities to make it a nicer place to live, otherwise the demand for inner city housing will always be high and expensive. In Sydney they have Macquarie Park as a tech hub/park - why is there no equivalent in other states? If the jobs are outside of the city it will relieve the pressure on everyone travelling in and out of the same area as well.
- Thaal Sinestro on 19/10/2022 - 11:54
  
  Change government policy to mandate that, for every 1 net migrant, Australia has to build one house. No new houses, no migrants.
  
  The problem is that , for the past 50 years, government has not been releasing land for housing development in proportion to the rise in population (growth driven wholly by immigration since birth rate is only 1.6 children per woman). Without net immigration our population would be slowly decreasing and housing would become cheaper due to an excess of dwellings.
Eeples on 18/10/2022 - 15:33

+1

There are 9 housing ministers in this country.

What are they all doing ?
- OzzyOzbourne on 19/10/2022 - 12:58
  
  Ensuring that the investors make money
drfuzzy on 18/10/2022 - 17:42

+2

Anybody in this thread who has objected to a nearby development because it would impact their view, light, parking, or amenity is partly responsible for the situation. The amount of red tape involved with increasing housing density has driven costs far higher than they should be. Rents will follow and continue much higher.
- cannedhams on 19/10/2022 - 17:29
  
  This. Impact assessment takes time, then of course there's the risk that the NIMBYs are motivated enough to take it to court. Can drag it out for yonks. Look at how fiercely the Woolworths store in Double Bay was litigated. And that was just a woolworths. Anyone attempting to build affordable housing there would be stuck in the land and environment court for years.
payless69 on 18/10/2022 - 17:52

Since we feral camp we are so social leaving them caravan park places for HN admirers and their bots!
pogichinoy on 18/10/2022 - 19:55

+5

There's not enough housing in the ideal areas where the demand is, simple as that.

For those who are aware of the Sydney area, most don't want to live in the outer suburbs, particularly the West. They all want to live in the inner west, inner city, eastern suburbs, north shore, south, etc but obviously these areas are priced high because of the high demand. You won't get anywhere having champagne tastes with beer money.

To fix the issue, cut the money supply. Once you reduce the availability of credit, prices will come down.

With regards to rent, at least in Sydney, rent has not recovered yet to pre pandemic levels on average. We still have a way to go.
- bobolo on 18/10/2022 - 22:00
  
  +3
  
  Right. Prices come down and hoardes of lower/middle class people rush to the premium suburbs, and guess what? Prices and rents go up due to competition!!
  
  If you look at the past 10 - 15 years, house prices in Sydney have tripled to quadrupled in value, and rents have stayed relatively flat. Pandemic or not, it would have been naive for anyone to believe rents to not catch up sooner or later, which is what is happening now.
  
  The only way to "fix" this is for people to change their perception that living in the outer suburbs is not so bad. This usually comes in the form of people becoming completely priced out of "desirable areas" and have no choice but to move west. If you look at pretty much every single property boom cycle in history, this is history repeating itself. Homelessness or compromise on location? You decide.
  
  Oh, and the other option is to make more money. But nobody wants to take the necessary risks to do that!
cannedhams on 19/10/2022 - 00:50

+2

Its actually more complicated than you think. But in short, the immediate precipitating factors were:-

a) internal migration, particularly to south east Qld. You would think that this would be matched by a concomitant drop in rents in NSW and Victoria, but rents, like wages, dont tend to drop as readily as they rise. Also, internal migration tends to increase fallow housing stock, because lots of people moving all the time increases the tendency for houses to remain empty for transitional periods. High levels of internal migration also disrupt living arrangements which tend, in aggregate, to reduce overall demand for housing - such as share accommodation, and younger people living with their parents.

b) increase in lockdown-related separation and domestic violence. This significantly adds to housing demand, since a separated couple requires two dwellings rather than one. In some cases, domestic violence orders were made requiring couples to live separately.

c) About 340 000 dwellings are listed on Airbnb, this has meant that the proportion of empty dwellings is slightly higher than the long term average (11.2%)

d) whilst Covid resulted in less migrants, it did result in an influx of returning citizens/residents; these people were often wealthy and their return resulted in additional rental demand, and properties being taken off the rental market

e) a decline in housing completions by about 20%, mainly due to timetables being blown out on account of disruption
Thaal Sinestro on 19/10/2022 - 12:01

-1

Fixing housing unaffordability is going to be complex and expensive, and no polity party will do it because all politicians own multiple investment properties.

The first step to rectify the problem, is for renters and poor people in generally, to STOP voting for the ALP. The ALP takes the poor vote for granted. Small target Albo and his party only cares about tax cuts for the rich, free childcare for the rich, and environmental policies that cause electricity, fuel and food prices to skyrocket. Albo is a class traitor who owns 4 investment properties and represents an electorate full of affluent upper middle class people. He doesn't care about the lower class and will never do a thing to help them. The ALP is the party of the top end of town.
- duchy on 19/10/2022 - 23:27
  
  +2
  
  What does 'class traitor' even mean? Someone who worked hard enough to improve their financial situation?
[Deactivated] on 19/10/2022 - 15:42

-3

Well it's great for me as a landlord, I can jack up rent rate using interest as excuse, but I've already fixed my interest rate ages ago, increases my yield hahahahaha
- Ghost47 on 20/10/2022 - 16:24
  
  +1
  
  Good on you man that’s exactly what this country needs more of! Enterprising entrepreneurs like yourself!
  
  May you one day own 1000+ investment properties 🙏

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