Nedved, I think your posts are mostly fair enough and level headed.
However you need to realise that Sydney and Melbourne are becoming much larger cities than they were when previous generations were growing up. They are now verging on (or already are) global cities whereas half the world didn't even know where they were 50 years ago. What this means is that the affordable suburbs are moving further out. There are plenty of affordable areas in the outer ring of melbourne and to a similar but lesser extent in Sydney, they are just further away than in previous generation, but what would you expect for cities with growing populations?
Added to this the younger generations are much more geared towards city living than the previous generations, therefore creating much more demand for the inner ring suburbs. Foreign immigrants also flock to the cities.
Everyone has to make choices, everyone has the option of moving to a smaller city if they want a big house close to work. But Syd/Mel house prices indicate to me, that is not what we want. We are happy to pay more for housing in the inner ring of the 2 major cities, this appears to be more important.
As far as being priced out, as Rona (and others) have pointed out, there are ways to get around this for those with the gumption to make it happen.
Buy an investment property where you can afford and rent where you want to live is the most obvious. Remember a rising tide lifts all boats, so by getting into the market with what you can afford and paying down debt (with help from your tenant) you put yourself in a better position to buy your dream home once the next round of capital gain comes along. Just make sure you buy well!!
You can say that it shouldn't be this way, but it is, and always has been.
It's just that previously generations couldn't afford to live in Vaucluse so they lived on the north shore or hills district
Now it is further again... And in 20 years it will be further again.
