I apologise for my little violin quip, it was a bit naughty of me.
But to just keep complaining constantly, that the boomers had it so easy and that you want the same opportunity does become a little tedious.
Plus your comments about the cost of houses compared to the average wage.
It would be great to turn back the clock, but we cannot. Believe it or not I am pretty peeved as well with the current housing situation. Australia, well over East, is now the most expensive place in the world to buy property.
Overtaking New York, London and Paris, ridiculous.
You are absolutely correct that keeping the interest rates so low is a major cause of this.
It would pay you to understand a little more about negative gearing. It was designed to take the pressure away from the government to build homes. Also to encourage people to provide housing for tenants to live in.
But the other benefit to the government, is to create self funded retirees who will never qualify for the age pension, plus other benefits.
With people living longer (all these crusty baby boomers) they are saving an absolute fortune!
Now you are making me research. Couples atm receive over $38,000.00 per annum plus a host of other benefits.
This, I assume is index linked. Let us assume for simplicity, that an average couple will draw the pension for 20 years. Even without indexation and the other benefits, this adds up to $760,000.000. Probably more than $1M if inflation is taken into account.
The amount of tax relief for investors is piffling compared to that. The 50% discount on CGT is exactly the same as for shareholders, so I don't think that you dare complain about that.
In fact the pensioners are doing rather well. But of course they would not have a lot of disposable income, therefore their spending would have to be curtailed. Unlike the other lot who will be running around keeping the economy going, probably buying rubbish.
I have made several suggestions over this weekend, but unfortunately none of these will help an aspiring FHB to purchase in inner Sydney or Melbourne. They will need to look at relocating to get their foot on the first rung of the ladder.
The rental shortage as we both know is at crisis point. I feel that the government will have to do a lot more to stop investors leaving and encourage more to invest. When I was a kid in England, the government built a lot of prefabs to alleviate the rental problem. The same could be considered here, maybe not luxury, but far better than a tent.
As for house prices, personally I do think they will begin to drop back, especially as the lending criteria is quite rightly, becoming much tighter.
Plenty of very well paid mining jobs in WA, I have met several couples who stuck at it for a few years and were set up for life.
But don't tell everyone as we like the peace in sandgroper country. When you think of some nice positive ideas, do let me know.
Go well J
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