THE PROPERTY MARKET
Apparently we are undergoing another property boom, or so the media tells us. They get all excited about it and talk about the unbelievable high prices for some really average type properties around Sydney. The media will even try to convince you that the property boom is a sign of a healthy economy and that we are all rich too. But is it a good sign of a healthy economy? Are things going well in Australia? If very high prices have to be paid for a house, doesn’t that mean that living expenses have risen in Australia? If the CPI was calculated solely on the median house price in Sydney, our inflation level would be quite high.
We have to go back at least a decade to when John Howard was in power, to see the start of the housing boom. Over ten years, during the John Howard/Liberal era, he would say we were wealthier than ever before. But this was only so because house prices had risen so quickly and so much. Further adding fuel to the frenzy was the use of auctions to bump up the price of so many properties. Previously, most houses were sold without using the auction process. By using auctions, greedy people outbid one another to get the property they want in a particular area. Also, if there was so little supply, why did the federal government still maintain immigrations level at the high level that were officially coming in to Australia. Surely this caused more problems for housing, especially in Sydney.
It was the federal government, both Liberal and Labor that maintained high immigration levels, even when housing supply was low on the market. Why did they do this? Was it to artificially bump up the prices of houses or to give an excuse for more home unit building by companies like Meriton to satisfy the “apparent demand”, created by high levels of unnecessary immigration? Did building companies donate money to political parties to create this housing shortage so that they could get the go ahead to build more home units in the suburbs and inner city areas like Moore Park and Wolli Creek? We now have massive home unit complexes with hundreds of units in these old industrial areas causing congestion and an ugly visual blight on the Australian landscape. They say they are trying to solve the housing crisis. But the crisis was artificially created by the federal government by its irresponsible policy of allowing so much immigration into this country, despite an unemployment percentage of about 5%. These new arrivals just add to the unemployment, overcrowding, crime and general decrease in living standards for many people in the suburbs that are affected by these units being thrusted into their shopping centres. Local councils were forced to accept these high and medium density unit complexes because developers took the local council to the Land and Environment court if the council rejected the development application. This ram rod approach was used by Carr’s Labor state government and every other state government has used it since. It was first started by Nick Greiner’s state Liberal government, then copied by everyone else. Local councils just seemed powerless the stop the onslaught of town houses, villas and units being built in suburbs that were a long distance from the centre of Sydney.
All this was done because the federal government was cramming more migrants into Australia, despite the difficulty of the country to house them adequately. We really don’t need so many ill educated and non-English speaking people in Australia. How will they ever find jobs, if their English speaking and writing is so bad? Yet the federal government never seemed to worry about that issue. This is what drove the so called housing shortage and helped to push up prices of houses in Sydney.
We shouldn’t have to pay so much for an average house. The shortage has over priced houses in the inner city suburbs. People are paying far too much for a mediocre property that would never have fetched such a price before this so called housing boom. The market is out of control and it is dangerous. Too much money is being diverted into the housing sector. Homes loans are far too high and will take along time for people to payoff. They then are more likely to default on them if there is a downturn in the economy and they become unemployed. Then they will have to rely upon the state for housing assistance. But the state has a massive back log of people waiting for housing from the Housing Commission. This has been known for years. So why do we even have people being let into Australia this very year through immigration.
The problem is just getting worse and house prices are still going up. Is the state and federal governments in cahoots with building companies to create a housing shortage and to increase the prices of real estate? It sure seems that way! Because that is what has exactly occurred over the last fifteen years. And yet the media and government, both state and liberal wont try to control the situation and stop it from rising to dangerous levels. The fact that it has happened, is a disaster in itself. Many people have been priced out of the housing market and are stuck in the rental market. It seems government just panders to property investors and landlords, so that they can make money out of more and more people renting. The percentage of people renting in NSW has increased due to the uncertainty of employment for many and also the creation of so much part time jobs. These part time jobs don’t pay as much as full time jobs and people therefore, can not afford to buy their first home or take out home loans. They are then forced to rent. This fills the pockets of property investors and landlords.
There is far too much renting in NSW, at the moment. It is all due to the massive rises in houses prices and the property manipulation that has been going on for years. They try to say that it is just the law of supply and demand, but it was the federal government that caused the housing demand to skyrocket with the high level of migrants coming into the country. This coupled with the natural demand from the existing population that had now decided to enter the housing market, caused such a surge in house prices, beyond reasonable amounts. The media don’t acknowledge the manipulation of the migration intake. Perhaps, it is too abstract a concept for their simple minds to grasp. Perhaps they don’t realise how much big companies can corrupt and force governments to follow policies that favour their business and profits. Why isn’t anyone really joining the dots and exposing this manipulation. It is obvious. Why do we need such a big increase in our population, when housing is such a problem and there are homeless people about Sydney? Sleeping out for one night in a sleeping bag, Kevin Rudd, isn’t going to solve the housing crisis he ignored or was too stupid to understand. He was too concerned about mastering his Mandarin and shoving his “Sorry” speech down our throats.
The fact is we don’t really need such a big increase in our population. It has occurred due to many reasons. Some of it occurred to undermine the power of the unions in many industries. Cheaper and ignorant migrants were brought into Australia to work in labouring jobs for lower wages and lesser conditions. Some were brought in due to compassionate reasons because some federal politicians see so much suffering in other countries and think Australia is so rich, it can afford to look after these people. But what these politicians fail to notice is the rise in poverty, here in Australia, when we try to solve the over population problems of other countries. Why do we have a homeless problem in Australia? And why do we still let in people from overseas? Solve the problems that have been created due to over immigration first. Don’t ignore them or say they aren’t the responsibility of governments.
Callous and detached people like Julia Gillard just said that people should take any job they could. If the job is low paying, casual and lousy, why the job doesn’t does disappear, like so many proper jobs that have been outsourced to overseas countries, by big companies in Australia. Why isn’t there legislation to prevent this from happening? There should be because the federal government then has to support these people with unemployment benefits until they get another job, if that at all can be achieved. But why destroy the job in the first place and give it to another country? Big companies and some federal government just aren’t serious about maintaining the existing jobs here in Australia. Most times the company responsible for the outsourcing to India or China is not in financial difficulties. They just want to boost their profits for the year, so as to impress their shareholders, and so the CEO can gain a bonus.
Australia is in a very bad situation, housing wise and employment wise. We have slipped back to a level of renting that was reminiscent of the post world war two years. This is not a good indicator of living standards for all people. Some people may have benefited from the situation—property investors and landlords. But many people are not graduating to home buying and eventually to home ownership. This is a more important indicator of the prosperity in the Australian community than rising house prices. As for employment, successive federal governments still have not solved the unemployment and under-employment issue that has been going on for decades. They have instead created a number of new industries with permanent part time work in them such as the child care and the aged care industry. The people working in these newly created and federally funded areas do not work full time. Therefore their pay is not sufficient for them to consider purchasing a house and taking out a housing loan with a bank. They wouldn’t qualify or be able to afford a decent enough house. Instead, they are stuck in a permanent rental situation. Things really have not developed over the years, for many people, to a position where they can entertain the idea of becoming home owners. Whereas, on the other hand, some people have been able to get finance to own a number of investment properties which they then get the more unfortunate to pay off for them, via rent. This is the pathetic reality of the property market in Australia now.
Really, more people are in a worse position than their parents were in. There was more home buying in the post war years (relatively speaking), despite the frugality of the post 1945 years. There was more full time employment and more security also. Since the demise of unions, we have seen huge numbers, of partially speaking migrants come into Australia and take over jobs on building sites. How ridiculous it is to hear so many foreign languages spoken on Australian building sites. There also has been an ongoing safety problem on sites because foreign workers don’t care so much about safety and owners of sites are not responsible enough to look after safety. Besides, very few owners are ever prosecuted for safety violations. They just say it is up to the worker to look out for their own safety. And instead of building houses to house more people, we see more units, town houses and villas being built everywhere. This is a backward step in the standard of housing in Australia. Families would prefer to live in houses with their own backyard. The standard of living that so many migrants wanted, when they applied to come to Australia, is now beyond their reach. They will be living, instead, in a home unit.
So next time you see a news story about the high real estate prices being paid, you will know that the only people reaping the benefits are the seller of the property; the real estate agent and the property investor. Everyone else is paying way too much and being ripped off.