Attitudes towards the Australian Housing Bubble are changing

January 11, 2014 admin Australian Economy, Australian Housing 40

Most Australians disagree rising house prices are “a good thing.” That’s the finding of a new polling by Ipsos and reported by Jessica Irvine in the News Limited papers today. Jessica writes:

A majority of Australians now think rising house prices are bad for the country, with exclusive new polling showing more than half the population disagrees with the statement that “rising house prices are a good thing for Australia”.

According to the survey of 1043 people conducted last November the following disagree with the belief rising house prices are a good thing:

Australia Total 53.7%
Aged 18-29: 50.8%
Aged 30-49: 55.8%
Aged 50+: 53.4%
Hobart 70.0%
ACT 53.6%
Sydney 59.6%
Adelaide 57.9%
Brisbane 55.9%
Perth 53.7%
Melbourne 52.6%

Attitudes are also changing towards Negative Gearing. In a poll conducted by Fairfax at Christmas, there was overwhelming support from 74% of 3831 readers to abolish negative gearing. The article attracted some 235 comments, with the vast majority in favour of axing the tax dodge.

As attitudes of Australian voters change, it will make it easier for government to implement the required reforms to the domineering property sector without fear of extensive voter backlash.

» Most Australians disagree rising house prices are “a good thing” – The Couriermail, 10th January 2014.
» Cabinet Papers 1986-87: Negative gearing almost axed – The Sydney Morning Herald, 28th December 2013.




40 Comments

  2. Those who are completely pro- Negative Gearing are generally,
    1) Baby boomers
    2) Have been educated at university free of charge courtesy the tax payer.
    3) Have purchased property during the days when average property prices (in today’s dollars) only cost $180,000.
    4) Curse the younger generation of having it too easy.
    5) Demand better health care and higher pensions after a lifetime of avoiding tax.

  3. The more governments refuse to do away with NG the more obvious they show to their voters there are special interest groups that support political decision making process. Maybe its time for the voter to pressure their candidates by refusing to vote for them and instead place a list of their complaints into the ballot box? or we can expose their actions and corruption on Facebook/Twitter pages? etc or vote for any party other than the Labor/Liberal Party monopoly? or vote for the leader of any party that has true working class roots instead of a well-off background? and I am open to any other constructive ideas that will force true change instead of complacency and approval of the corrupt political establishment we have today by the majority of voters.

  7. Great Video Paul. Love the quote from Thomas Jefferson, 3rd President of the USA (1743-1826):

    “I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.”

  9. @THEO,

    I asked here on this blog prior to the election who the anti-NG candidates were and didn’t get an answer. Asking around there didn’t appear to be any for my area. Even those that are campaigning on the platform of affordable housing don’t want to talk about that option, so I don’t see how simply voting is going to solve this.

  10. Until the people of Australia start voting out the politicians that dont get rid of NG then nothing will ever change. Thats the only way to send the message to them. Talk is cheap action speaks louder than words.

  12. I think the biggest issue is public wages.

    Do you know teachers are getting 100k in WA? Nurses. Garbos. ATO workers.

    Their wages are off the scale and in some instances they get paid more than private sector counterparts…

    I don’t understand how it happened but it’s fked.

    I know some teachers who have been workin 7 years but somehow together they’ve amassed 4 properties? Honestly what the hell. I also know a nurse who has 2 and a ATO worker with millions.

    It looks like if you want an easy life lots of kick backs and rewards for being lazy get a government job and stay in it for 7 years and you’re set. You get key start loans early ok then pay almost zero interest but then your wage skyrockets.

    And now they are asking for 4% a year for 3 years even though private sector wages fell last year. How the fk does that even work! Less tax but they want to get paid more.

    It’s becuase Rud and Gill-tard gave them everything they wanted last round of negotiations. Now hey are going in extra hard because they think they will get it and they will strike if they don’t. Idiots

  13. Good to see the flood of properties on the market at the moment… It used to be you couldn’t get a rental. Now you can negotiate cheap rent 20% off lol.

    Looks like the markets collapsing, people are trying to flog units off left right and centre for a couple of hundred grand that used to be 300-400k.

  14. @peterpanda – where?

    i’ve witnessed first hand some number of rentals falling in price, houses falling in prices, in geelong.

    friend recently told landlord to drop rent by 30/wk, or they leave straight away. agreed to.

    one thing seems certain here, prices arent increasing and more and more signs are on lawns (see SQM research).

  15. We have a top-heavy system.
    Around 35% of GDP in Oz in spent by government.
    I believe if it were anywhere near sustainable. It should be around the inflation rate.

    prepper

  16. Half of the country have woken up, but the other half haven’t. The half that haven’t are the rent seekers with the money and the political control.

    Anyhow, it’s probably too late. Australia is now internationally uncompetitive at everything except digging up dirt, and tweaks around the edges won’t change much. When the commodity cycle starts to dip (as it always does) and mining cap-ex really tails off, the drop in national income will be a sight to behold.

    It’ll be mortgage defaults and government deficits to the moon! 15 years of terrible policies at all levels of government coming home to roost. Watching from here in California should be a hoot.

  20. Are prices going to come down, really? Or do we have to move country? I can’t survive 🙁

  22. ^ I’ve noticed here in the northern burbs of Brisbane that homes in the sub $500k price range are selling within a few weeks to investors. I can tell they are investors because as soon as the ‘SOLD’ sign is put up there is a ‘FOR RENT’ sign put up as well.

    I’m guessing SMSF investors are absolutely frothing at the mouth for Investment Properties.

    So in answer to your question Angela you might have to look overseas for a ‘fair go’ in the property market.

  27. @Jj

    all my savings are US$(i converted them between 100 – 105), just sitting on the front porch of my rented house, drinking my expensive wines, wait and see who’s been swimming naked.

  29. swimming naked, not me. I love to sipp expensive wine too. My money moved out to Euros in May last year and sits pretty with a German Government backed guarantee, while the interest are not soo high, I pay no tax and Europe is sliding into deflation slowly. Though I still don’t know if I will move back to Germany one day or stay. In case I stay I will transfer the savings back here with a decent return. Now all I need is this house price to come my way……..

  30. Hi JJ, I am thinking of doing the same…who did you move the money to Europe with? My bank gives horrible rates. Appreciate it

  34. @DX – Who is going to stop them? The Government?

    Remember it was the government in 2008 who “streamlined the administrative requirements of the FIRB” so foreigner’s could buy property unhindered in a bid to prevent the housing market and hence our banking system from collapsing.

    They only reinstated the legislation preventing this after the public found out and profusely complained.

    The government wants [needs] the Chinese to purchase used homes unhindered – they are hardly going to stop or police it.

  35. In the end we may all just end up as tenants with a very cheap range of accommodation to choose from. Not such a bad thing you know.

  36. I don’t think NG is so bad, it seems fair in a way for business and people to be on the same footing. Main problem is that it coincided with a giant bubble and loose credit. Coincidence or causality can be debated forever, as no control experiment can exist in real life.

  37. Here’s my take on things. I have a family and rent. I’m in the medical field, I train medical doctors. I understand some of what’s going right and wrong with medicine. There’s a lot wrong, and I truly wish I could fix it. But, here’s the thing. I can’t afford to buy a house in AU and at the same time have my partner remain home and raise our young family. Because I’m in the medical field, I understand the potential damage that can occur when placing children in long-term day care. We won’t do it.

    I can tell you, many people in my profession are not primarily focused on the ‘training’ aspect of our young up and coming medical professionals, not when advancing one’s career through the bureaucracy is more important.

    I’ve never met another person in the entire country that teaches the medical students how and what I teach them – which is absolutely crucial for their ability to practice. It’s rather astounding when you think about it.

    When I leave, this experience goes with me. It isn’t going to be replaced (well, maybe with the internet but even then there’s only a few people in the world doing so).

    Iatrogenic death is the 3rd leading cause of death (think of this as incompetence). We NEED people like me to stay and do what I’m good at and passionate about.

    I’m also interested in creating a business around the education of children and forming a novel link with Asia that would involve exchange programs. That just isn’t going to happen in AU. It’s simply too crushingly expensive to live here.

    I hope I can find a place in another country sometime in the next 2 – 3 years. I don’t think we Australians fully appreciate what we’re losing by having a property bubble. A bubble that isn’t helping those who don’t want to be a renter or a landlord, who don’t want to flip houses and who actually want to create new businesses that service society with high quality new products.

    Anyway, that’s my story.

  38. Spot on M2… a lot of people with valuable skills are leaving due to ridiculously high house prices. If only renting conditions weren’t so ridiculous, it is in the real estate agents interest to change tenants as often as possible..I’ve moved 3 times in 4 four years with a young family and I’m sick of itrv. f

  39. @M2
    We decided to leave Australia on advice of Aussie friends that have already made the move. The social change is profound.
    People have manners here- no FOMO. There is enough for everyone and to share. The social environment is inclusive. People are degree educated. We can afford better food every day than we would only eye at super expensive boutique grocery stores in Aus. Medical care is top notch. People care. My friends here are starting their families as owners of spacious homes with yards for the kids to play – on single salaries. I can afford a luxury German car. The beaches rival the best in the world and the climate is temperate.
    There is something not right with the way real estate cost negatively impacts life in Australia – in hindsight that’s as clear as daylight and it is a bloody shame.

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