Since writing the post on the Money Tree, I came across this excellent article, and spoke to some friends about the reality of home ownership in 2016.
My parent’s and my generation were brought up with the expectation that we would own a home, with assistance from our parents in the form of a loan or deposit. In the mid to late 20th century full-time, permanent jobs were achievable, and the cost of living low enough for couples to live off one wage.
All of this changed around the turn of the 21st century. People started to invest in housing instead of stocks and bonds, or self manage their own superannuation. The government offered incentives on investment properties, that weren’t available for personal home loans. This drove the price of housing up at a rapid rate; 300% in South Australia, and more in the eastern states.
To add to the difficulties in securing a home loan, banks were spooked by the Global Financial Crisis, despite our government going guarantor, and tightened lending regulations for home buyers. As a result, a fat deposit is no longer the step into home ownership. It has to be backed with a good credit history and proof of a permanent minimum income.
Permanent full-time jobs are steadily decreasing in Australia, replaced with contract and casual or part-time work. There is no such thing as job security anymore, and most workers are pushed to their limits with performance management, long hours, unrealistic work expectations, with under-training and an ultra-competitive work place that is constantly looking for ways to streamline procedures and cut costs.
For manufacturers, tariff reduction and free-trade agreements mean making locally is no longer a competitive option, with labour costs far cheaper in poorer countries with lower living standards and workplace conditions.
If you aren’t part of the lucky generation, or politicians, who receive tax free superannuation benefits for the rest of their life after retirement, the next retirement generation is going to be working until they are too old to do so. Then living on the aged pension with a mortgage or rent still to pay, and adult children to support both financially and physically with day-care for grand-children.
The CityMag article referred to above, looks at the realities of housing today and a change in the way people are living. We used to live in multi-generational housing, as many cultures still do, but the last century was an odd bump in the road with the “nuclear family”. The future of housing has to address a much larger population, mass migration due to climate change or war, and less money moving around in the economy.
I don’t think these forced changes to our way of living have to be a bad thing. The excesses of the 20th and early 21st century in western societies can move to a more inclusive and community based way of living. Technology allows us to see how other people live and we can learn a lot by simplifying our lives. I look forward to seeing what an affordable, adaptable, totally self sustainable home can look like. By removing the expectations of the past, we can start with a clean slate and ask, what are our needs and what makes a meaningful life?