Anthony Albanese’s budget reforms may make things worse for young buyers. Picture: Martin Ollman.
COMMENT
There are winners and losers in every scenario involving people and money. If someone is making money, it’s because someone else is spending it.
Many Australians, myself included, are sorely missing the money currently bleeding out the door and I’ve been wondering who will emerge victorious in the coming years, as the federal government’s changes to property laws take effect.
My gut feeling is that it won’t be the stated target market, being Gen Z and the last of the Millennials (Gen Ys too young to remember the Last of the Mohicans).
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As someone who came of age in the early ‘90s, during the worst recession since the Great Depression, when there were no jobs, I can say with confidence that an economic climate in which so many Australians are already doing it tough is a sewer that flows steadily downhill.
I wonder who will be first to feel the hard blow of the axe now that the Greens have chained themselves to Labor’s plummeting popularity tree (instead of going old school and fighting to protect Tasmanian forests from a dangerous new introduced species: AI data centre over-development)?
Boomers have the ‘Midas touch’ in all matters economic.
You also have to wonder who among us taxpayers will survive this economic wilderness long enough to stagger into the clearing and claim a piece of the winners’ circle this time around.
Obviously the Boomers will be there, because Boomers have the Midas touch. Winning is all they know how to do. Their entire demographic is like that one family that wins the Mother’s Day Breakfast raffle every single year without fail, and they never leave the school because they’re the only ones who can afford to have a fourth child.
But I digress.
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In the lead up to Budget Night, any Aussies with property investments – being Boomers (many of them now enviably spry grandparents, whose health and wellbeing is much better than mine), a decent portion of Gen X and older Ys, plus a smattering of early Z unicorns – were saved by the late-landing but aptly named grandfathering exemption.
Good for them.
But they may start feeling a little grey for real if they need to offload their portfolios right now, because the much-discussed young Australian first home buyers probably won’t be buying much of that “former rental” investment stock.
Could it be the end of the ‘fixer-upper’, that FHB rite of passage?
Instead, I fear we are witnessing the sorry end of a first home rite of passage: the fixer-upper.
Historically, the modest, dated, peeling, crumbling, decidedly unsexy stock was a gateway to both home ownership and property investment for many young people through the ages, who all happily rolled up their sleeves, donned overalls and painted and repaired these places themselves.
Once upon a time, daggy deceased estates were commonly cheaper and investment properties hitting the market after decades of “group house” abuse were not just the newlywed couple’s dream listing but the first-time property investor’s too.
But no longer.
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I suspect investors now looking to unload these types of properties will struggle to get their asking price, despite the very real housing shortage that the property reform “new development” stock purports to solve.
Overnight, those properties are a tough sell, because investors don’t want them now either.
A fixer-upper in a capital city might mean a $1-2 million mortgage, which by the way should not be anyone’s idea of a reasonable entry level purchase price, especially not if you’re a spring chicken, aged between 18-30 years old, without a golden nest egg coming from the aching-to-be-immortal Cocoon crowd.
A $2.5 million dollar mortgage in many desirable parts of Sydney won’t be enough to get them a tiny 2-bedroom Federation semi with a rampant rising damp issue and no parking. Besides which, those crazy kids would be looking at nearly $16,000 a month, according to Westpac’s mortgage repayment calculator.
The reality is a long way from the ideal for young buyers wanting to get into the market.
Some of these aspirants still have means-tested and extortionate HECS debts to pay, for crying out loud. And if they can afford to meet repayments of $16,000 a month on top of every other unavoidable living expense, then they’re breathing rare air in their age group and beyond, and they’re going to be just fine.
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But what of the rest of them? And what of these fast-tracked, often ill-conceived and shoddily constructed “new builds”?
I hope there is convincing evidence or legislated expectation somewhere that these developments – which will be high-rise projects blocking out the sun, eagerly waved through by local councils, crowding into and looming over neighbourhoods completely ill-equipped to support exploding resident and vehicle numbers – will actually be affordably priced?
What makes anyone think these new builds will be sold cheap enough to help young Australians get onto the property ladder (which is an Ikea step-stool now – a bargain at $19)? The new apartments around my neighbourhood are all much more expensive than the old ones.
Are we perhaps starting to glimpse, behind the twitching curtain up at Capital Hill, who else actually scored on the never-to-be-forgotten Night of Broken Promises? Aside from all the property savvy politicians themselves, I mean, because I’m sure after realising their mistake they drew a careful dividing line protecting their own investments.
So who is left? Well, I’m not a gambling woman, because it’s pretty clear that the House always wins, but I’m guessing the nation’s CFMEU chapters might have cracked open a few celebratory cans on budget night, thanks to their old mate Jimmy Brings.
Did someone order Jimmy Brings? Picture: Martin Ollman
And does he what: a motion was passed in parliament on Tuesday to vote on the Building Cooperative Workplaces Bill next week, a bill which, while related to Commonwealth construction projects, may turn out to be the harbinger of Australia’s future housing fat cats, and I’m not convinced the rest of us are invited to the party.
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Australians – and I’m going to say predominantly Gen X and older Millennials – were already in the grip of white-knuckle anxiety before budget night, about their jobs, their homes, their kids (an endless worry whirligig of screen and social media addiction, tanking mental health, the rise of youth violence and knife crime, what has to be the most medicated generation in human history, their future prospects and planet, and so much more), the size of their bills, reaching an age where getting a potentially life-ending disease becomes a real thing, the state of their poor, neglected marriage, the inexorable march of menopause and male pattern baldness, their parents, the spectre of mismanaged superfunds and … you know what? Let’s stop there.
Put it this way: I’m pretty confident most of our “sandwich generation” lies when the doctor asks them how many standard drinks they down each week.
Many of these pressures revolve around money and will only be resolved with the help of money. Pity there isn’t much left in that battered old Arnott’s tin at the back of the cupboard.
“Bye, money! I really could have used you here – but good luck, it’s a jungle out there!”
But seriously, no hard feelings.
Farewell money, it was nice while it lasted.
I wish money all the best in its future endeavours; we had really grown apart in recent years. Our relationship had become pretty strained by the end and maybe we really did need more space apart, to figure out what’s truly important and exactly what we mean to each other.
I do miss having money around, though, and I still think about money all the time. But perhaps this is for the best and one day, we might even look back at all this and laugh.
“Utility bills, eh? Aren’t they a bitch?!”
“Sure, but get a load of the price of groceries – my watch started beeping because my blood pressure was so high at the self-checkout!”
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“Ha! Don’t get me started! Guess how much the taxman took this year?”
“Stop it – the ATO even had the nerve to send me an extra bloody bill!”
“And the interest rate on our mortgage? I can’t even!”
Yes, maybe one day, I’ll be lucky enough to stumble across money on the street. I’ll be genuinely excited to see it after so long. I’ll scoop it up into a warm embrace (inside my tightly closed fist – sort of like a hug but a lot more desperate) and we’ll talk about the old days of the 2026 federal budget and we’ll laugh and laugh.
Will we, though?
No, of course not. I can’t even talk about money anymore without screaming and crying like the sad girl who’s had too many Bacardi Breezers and not enough Kettle Chips, sat in the gutter outside the pub after last orders on a Saturday night howling, “But I still love him…”.
Don’t we all, sweetheart. Don’t we all.
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