I wasn’t the best or worst maths student, but managed an A or B grade, according to years 8 and 9 report cards recently rediscovered atop my wardrobe.
One teacher suggested I talked too much.
Touche. Some would say that hasn’t changed.
But the formula for home ownership is becoming harder than algebra.
When I graduated high school in 2000, the average annual income in WA was $33,620 and the median house price was $170,000.
Now, 24 years later, house prices have more than trebled to be up 305 per cent while income is up 190%.
Interest rates were 8 per cent of a much lower base.
Even if you subtract the smashed avo from your weekend routine, none of that adds up to good news for the next generation.
Our neighbours put the For Sale sign up last week, making the most of the property cycle to pursue a new renovation dream.
But in between mowing the lawn and sweeping the driveway for the next home open, they echoed the growing concern of many parents: how are our kids ever going to afford to move out at these prices?
I wondered out loud if Australia has become a nation where home ownership depends on generational wealth.
Our parents worked long and hard to climb their first rung of the property ladder but by the time it was our turn, that meant they were able to help.
My husband and I needed that leg up to buy our first humble abode and again, later, to upgrade to make room for a family of four.
Suburbia’s continuing price trajectory up means we’ll be able to help our children out in turn.
But what about families who missed the first step of the ladder?
How do their kids catch up now that hard work and a single income isn’t enough?
A property boom that is outpacing both wages and new builds is resulting in a new class divide, in a nation that was born out of the idea of equal opportunity no matter the circumstances you were born into.
A noble theory, not always reflected in reality.
So what’s the solution?
Negative gearing is an easy horse to flog but property investors are an important piece of the housing bubble.
I can’t understand why stamp duty isn’t under a heavier spotlight.
It’s calculated on property value, meaning the amount an average homebuyer has to pay is increasing much faster than wages.
It’s a State tax that was meant to be axed when the GST was introduced. Also 24 years ago.
Maybe that’s one part of the GST deal WA should revisit?
Or at least ensure the stamp duty-free threshold for first homebuyers keeps pace with prices too, before the great Australian dream becomes a furphy beyond their reach.
