I think this is picking on an easy target when the blame should be shared around. Baby boomers didn't insist on high house prices; I'd suggest easy credit and possibly unsustainable population growth could be factored in. In Europe families seem happy to live in apartments but Australians feel they are entitled to a house on a quarter acre block. Moreover by being unwanted by the full-time work force baby boomers may have difficulty maintaining some semblance of their former lifestyles for the next 30 years or so, not to mention paying increased property rates and taxes. When and if they go into aged care or downsize it is possible the urban housing shortage could ease. Generation X may have accumulated its own wealth by then, a situation apparently not envisaged.

As in other matters the underlying problem is that the economy overreacts to short term influences while neglecting the long term.

Ho Hum, more intergenerational jealousy bunkum.

With the greatest respect to the author, you would have to be naive to believe the politicians and others with a secondary agenda in mind who spread the story that baby boomers are somehow responsible for high house prices.

You could make a better case blaming migrants or people with two incomes - not that they are necessarily to blame either but it does underline the cynical 'blame game’ politics that are used so successfully by some politicians to divert attention away from other issues.

The author wants a return to a low return on houses. Now that is a really silly statement because twenty and more years ago rentals delivered 10% return easily, which made them viable to keep and maintain. However for some years the return has been dropping.

Real estate agents and other urgers claimed that investors could make money from a 7% gross return on rents and then lower, until we arrived at the situation we have to today where investors are getting 2% and lower GROSS without deduction for maintenance and other outgoings.

Owners are effectively supporting tenants' lifestyles while they can get far better returns elsewhere and without the same risk, worry and inconvenience.

Just think for a minute: there are low or negative returns on rent in an environment of increased taxation and government services on housing, escalating government regulation (which increases costs), high insurance premiums and expensive trade services (electricians, plumbers, carpenters and the like). On top of those there have been eight consecutive interest rate hikes.

These are a risky times for the rental industry and a loss of confidence could be catastrophic.

The outcome of what the author is suggesting would be a collapse of the rental market and high rents. Frankly, who does the author think is supplying welfare housing in this country because government has not supplied sufficient welfare housing for decades. The private sector of course!

A thoughtful article. Thanks.

I notice the boomers are already out in force defending their excessive wealth.

Though I don't necessarily agree with all the policy prescriptions (I don't think land release would do much for house prices where it really counts), it's clear that for various reasons, many deliberate government decisions, one group has received a huge windfall at the expense of the following generations.

This cannot last, for reasons of basic economics. Governments will eventually be forced to tax more heavily those who hold most of the assets, simply to arrest a sharp decline in tax receipts as the working population shrinks in proportional terms and the cost of supporting the ballooning ranks of the elderly increases.

No less than the former Reserver Bank governor has warned of "intergenerational conflict" because of this fundamental problem.

Boo Hoo.

My heart doth bleed for the poor little buggers with their IPOds, MMS phones and their whatever attitudes. Guess what? It's the market stupid!

They'd better get used to it, since they're the ones who voted in the lassez-faire, free-market-will-fix-everything John Howard. They want it both ways ? Forget it... whatever...

Great article Damian.

I see this as a big problem, and I dare say those who don't think it is, probably own a couple of investment properties, and are over 55 years of age.

Cornflower, I assume you are both a boomer, investment property owner, and a highly skilled economist, employed at a top tier investment bank to have formed your opinion on this issue, although I very much doubt the last bit.

My dad bought his first house in the late '60's for $25,000 in Lilyfield. That same house today is worth $600,000+ with most of the increases in value occurring in the last 6 years, which is an insanely unjustifiable increase in anyone's language.

You can't tell me there hasn't been some seriously greedy behaviour on the part of the baby boomers over the last twenty years (not just in housing either), as history shows they're masters of taking what they want at the future's expense.

Take university fees for example. Did the boomers have to pay for Uni? No, but it was they who took free education away from their own children.
How about pensions, Medicare, hospitals, government schools etc? All screwed so the government could hand the boomers a tax reduction, and we could have a $10 billion surplus which it we allow the boomer run government to hide away rather than spend where it's needed, probably to pay for the inevitable boomer retirement shortfall which is a short way down the road. Such a fine example they have provided for those who must follow in their morally dubious footsteps.

From where I sit, the boomers are generally a selfish pack of vultures, screwing this nation/planet for all they can, more often than not so they can send their money to Germany for a new BMW or Merc or a new Persian rug.
Such an entitled bunch of hypocrites, considering many of them were rotten socialist scum in the 60's.

It really is time they got off their high horses, and thought about their kids instead of themselves for a change.

I know, I'm dreaming.

With all due respects but having a trader for an investment bank preaching to us on investment ethics is a bit rich. People who are prepared to work hard have more opportunities than ever before to make good money and get into the housing market. In mining towns $80000 per year jobs are going for the unskilled.

In the West thousands of migrants are taking up opportunities and buying houses. I personally had an investment house that made a considerable loss for 10 years (after being trashed while less than a year old by tennants). Even now the rent barely covers repayments and yet I am providing a place for someone else to live.

The author knows to well that taking away tax benefits for those brave enough to invest would only create a bigger rental shortage than we have now. We know the Labour party experimented with this for a very short time only to realise the foolishness of their mistake.

We have been told by Governments of all persuasions that despite paying taxes for decades not to expect a pension in the future. We are encouraged to save and invest. Now we have a trader of shares implying it is somehow immoral unless of course we hire a trader to invest for us.

You have no idea at all.

Today has more opportunities than evver before.

The price of homes may be higher, but the ability to leverage is larger, and the 10 or 20% deposit is no longer needed as we can borrow up to 106%.

Property prices have statistically at least doubled every 10 years and have done so since the white invasion. This will not ever change and i wont even bother to explain why. Property may be less affordable at this point in the cycle, but when you quoted your 4 times median wages, what where the interest costs then?

And as for the sour grapes on baby boomers, wealth from baby boomers will be transferred eventually,

Why dont you have a real go yourself instead of whinging at people who have finally got the wolves off the door. I suggest many baby boomers had very modest childhoods and good on them for accruing wealth?

I suggest we get someone to submit article with more of a realisitic understanding. Do some homework first hey.

Stomont you missed a great time. The 1960s were great, easy sex, no AIDS, every one stoned at Sunbury, racing drunk down tram tracks on Friday night, great demos against Vietnam war, really low unemployment, amazingly cheap inner city housing - yeah!

In the 1960s and early 1970s the banks wouldn't provide mortgages for properties over 35 years old or to women.

Yes its a real problem that house prices are so high that its hard to imagine average wage earners ever being able to buy a house in a capital city and clearly that will change as the supply of dwellings over takes demand. Whether that happens slowly or fast - time will tell.

Baby boomers have invested in real estate because its more transparent than shares, warrants, futures and stapled securities and since the 1960s its been clear to see the way its increased in value while during the same time the stock market hasn't performed as well.

Another salvo is launched in the intergenerational slanging match. Bravo.

It's times like these that the demographics of posters interest me greatly. As indicated in earlier posts, it would be interesting to know how many are comfortably ensconced baby boomers, making what they believe are genuinely objective comments from the comfort of their lounge room... but I digress....

It's good to see a few articles pointing out the other side of the argument.
With the boomer generation so heavily established in all spheres of public life, I don't see how anyone can deny the fact that they are those who are in power. What's more, it's a cardinal rule that those in power tend to look after their own interests first... but I'm still digressing....

In regard to this article, I suppose it's reasonable to point out that this generation has plenty of opportunities (though not everyone want's to make their living as a miner, and that will be my last digression I promise) but this article is about house prices.

House prices people. And put simply, the young generation is being screwed by the situation - and while that situation may not have been created by the boomers, I bet they're not dissatisfied by it.

What's more, sooner or later something will have to be done about it, and if it results in a fairer result, then I say, all to the good.

Stomont

You sound envious and lazy.

Go to realestate.com.au and you will find hundreds of units and houses available under $250,000 and many well under that price.

You can have some of the action if you want but you have to make an effort. Working is part of that as is doing without some non-essentials. Many people spend more on their tech gadgets, phones and entertainment than they would if they bought a unit.

It is silly to try to compare yourself with people who are at the end of their life and earning. You should also be aware that just because an older person's house may be valued higher because development has overtaken it, it is still just a place for them to live and the higher valuation just means that their rates have gone up. They have to live somewhere or would you begrudge them that too?

Well that is about it for free advice, however I sense that it will be wasted on you but not perhaps on others (who no doubt you will be jealous of too in time).

Please all not Damian's qualifications at the bottom of the article, the defence rests.

C'mon Shonga - Equity Trader and an Investment Banker? I would have thought that would make Damien doubly qualified to talk about market predation/speculation....

I find it interesting that generation labelling for marketing purposes has become part of our language though. Some TV marketing executive in America one day worked out that commercials just weren't selling to people born after {insert date from 1960-1969 here} and labelled them Gen-X, and for those born from 1940 odd to that date as Baby-Boomers. Seems war makes people toey.

There is some merit in this generational theory though. Life experiences will be to some degree dictated by the social policy of the day.

A striking example being access to safe employment because of trade protection that existed before the Button Plan of the Keating/Hawke governments. Today's kids instead have to compete against the sweat shops of Asia.

There is also a marked difference in work and leisure activity between the diffent age cohorts, which can easily be seen by comparing people of different ages in similar jobs and how they interact with their boss.

It must be remembered that this theory is a marketing tool. There is no typical 'Boomer' or Gen-Xer or Gen-Yer. Not all Boomers are "Give Me", not all Xers are Lazy, and not all Yers are Tech-Heads. See also http://www.libraries.vic.gov.au/downloads/Public_Libraries_Unit/the_abc_of_xyz_generational_diversity_at_work.doc.

There are a number of possible answers to this problem. Firstly just remove all the tax concessions, such as tax deductability of interest payments, and subsidies to anyone buying a property for investment purposes. That will mean that there is a level playing between people buying a property to live in and people buying for investment. If done over a period of years it would prevent large amounts of houses coming onto the market all at once.

Secondly, force those holding on to empty blocks of land which have planning permission for housing to either develop or sell them within a reasonable time period. This could be done by say introducing a 100% tax on the value of any land where building hasn't commenced in say 3 years. This woulsd release a large amount of underused land onto the market.

Thirdly, expand dramatically the number of houses ownwed by housing associations or governments aimed at those on permanently low incomes, such a s pensioners, those who are disabled etc

Cornflower,

I'm 28, I've run my own business, own two cars, and a house. I left home when I was 16, and have worked hard since. In that time I've taken only one holiday which lasted more than a week, and I'm currently doing a Masters Degree despite my lack of HSC. More than most people I've met, hardly lazy, let alone envious of the old.

Maybe I should give you some advice:P

Have you been to a unit selling for 250k? Doubt you'd want your' kids living there, although one has to start somewhere.

The point about people living in their own homes is irrelevant. Author is speaking about "speculative property buying by baby boomers". Those living in their home of 20 years are not going to impact prices since they aren't on the market.
Gadgets are irrelevant. The cost of buying an ipod is so small, as to be insignificant compared to the deposit required for a home, unless you own thousands of ipods.

As for those questioning the qualifications of the author, he works for a highly respected bank, as does the economist whose RESEARCH he is quoting, and I know for a fact he is more qualified than most (I actually checked him out rather than assuming he had none, because they weren't emblazoned on the bottom of his article).

Also, given he's a trader, it can be safely he assumed he CAN afford a house, probably a nice one, so it's doubtful he wrote out of personal grievance.

Iluvatar, do you seriously think the youth voted Howard in? Got any evidence? According to the ABS, the largest proportion of the population's age lies between the ages of 36 & 59 yeas of age, Howard has been in power longer than many young people today have been of voting age, and considering a huge number don't vote at all, your' point doesn't wash. Blaming the young is sadly typical of your' generation, when boomers are in power, they're the majority, and they make all the decisions, it just doesn't add up. Hardly "bunkum"

Damien, in your polemic against Baby Boomers you imply that we're a bunch of greedy capitalists who have grabbed what is not rightfully ours. This line of argument is a simplistic form of scape-goating that confounds the problem rather than contributing to a solution. The market allowed Baby Boomers to buy investment properties, and most did so following financial advice on how to prepare for a self-funded retirement. For most, their aim was not to make money but to acquire a capital asset as a hedge against poverty in old age. In seeking to bring down the Baby Boomers you vastly overestimate their wealth. Most are wealthy on paper only because they bought their homes in a period of high inflation and have contributed to superannuation during their working lives. If you looked further you would see that many of these so-called greedy and unscrupulous Baby Boomers are also parents who are now using their “ill-gotten wealth” to assist their children into home ownership. This unfortunately is a short term fix and not a long term solution to rising house prices. You have also conveniently ignored the fact that a sizeable proportion of Baby Boomers are not adequately prepared for a self-funded retirement, in particular women who as parents gave up careers to care for children. Many are now single, without adequate superannuation and a proportion will undoubtedly fall out of home ownership when faced with living on inadequate super supplemented by welfare payments. Most of us would love more than anything to have grand children however, to use a market term, as with housing, the next generation is also becoming a scarce commodity. In short Damian, we the Baby Boomers are not "the enemy". Most of us are parents who are as concerned about housing affordability as you are.

Wallaby - you make valid points but they don't really address the core issue of what makes baby boomers such an influential group - raw numbers.

That's the entire reason why baby boomers are so significant - they're boomers, as in, a surge in numbers of the population.

So in a democracy, where ultimately, people vote for who will cater to them, the demographic with the largest numbers will win out.

It's not an issue of the boomers being an evil, selfish group - simply an issue of policy and economic prosperity reacting to those who hold the most sway - the boomers.

So no, the boomers haven't made any grand villainous plans to cheat the following generations. It isn't that simple. I'm sure most baby boomers do feel genuine concern for other generations (when they're not blasting them for their Ipods or whatever the insult du-jour happens to be) but they have had a profound impact on the economic and political landscape of the western world.

And it has been to the detriment of other generations, be it intentional or otherwise.

I am a generation Y'er and whinging about the baby boomers having all the wealth is a case of sour grapes.

Good on you baby bomers, youve worked hard, bought property, and done well.

There is nothing stopping all you from gaining the same wealth, except yourselves.

Dont tell me you cant get fiunance, cant tell me you cant enter the property market, dont tell me you cant start a business, you all can and if you choose not to, its your loss.

Dont bring anyone down for achieving wealth. Get out there and do it yourself or praise them for many getting to the point of financial security.

In this world there are the doers and there are the whingers, many being posters here, and the writer.

No matter what year it is, weather 1920's or 2000's there are always difficulties. I suggest we all stop being jealous, be prepared to live modestly and purchase modest property, and stop spending all our money on flat screens, interest free furniture, and luxury items. The silly thing is, you dont even need money to leverage property, so noone has an excuse or reason for not doing it

I don't think it is a conspiracy. Rising house prices are just a result of demographics and the new fiscal environment.

Australia gets 1 million new migrants every five years. That means we need to build a new Perth or Adelaide every five years. That is a lot of new houses and so it is no wonder that unlike the European markets houses rarely go down in price.

Retirements have gone from tax based to super based. Instead of being heavily taxed to pay for current pensioners we are becoming more lightly taxed but have to fund our own future retirements. All the excess money has gone in the stock market and housing markets. The housing market is seen as being more reliable (no dot com bubble) so more money goes in there.

The influx of cheap manufactured goods from Asia has kept inflation and thus interest rates artificially low, allowing the excess money to cause the price of houses to inflate. I don't know how inflation is calculated but I don't understand how the price of houses can go up by over 30-50% every year while inflation remains below 3%.

Demographics have the numerous baby boomers in their high earning years. Gen Xers will always be in the minority as they are outnumbered by gen Yers. Over the years wealth locked into baby boomers will either be squandered in retirement or passed on to the next generation. Global warming is the big unknown, it could make some cities inviable in years to come and thus their real estate worthless. However that is not likely to happen on the time scales of this discussion.

Finally we must ask ourselves if owning a house is all it is cracked up to be. I suspect that would be a whole different topic

“significantly devalued the lifetime earnings of non-homeowners, particularly young people."”

I would have thought “young people” would not be in a position to have reached their “lifetime” earnings, unless they expect to die immediately, in which case, they will have no need for any earnings at all.

This article reads like just another misrepresentation by the manipulative (or lack of understanding by the incompetent) of how the affordability equation works.

If, God forbid, some socialist swill humpers were to win federal government and they were to stuff the economy, like Keating did with the “recession we had to have” and interest rates of 17% +, house prices would drop back to less than ½ what they are now and when earnings collapsed in the face of spiraling unemployment, house prices would drop even further.

Ultimately the 30% of gross earnings rule still applies to cost of borrowings.
No point trying to argue against unfairness, the market is the market. Emotional outbursts of “unfair” will not change it and trying to meddle with it will result only in a short term distortion as our misspent taxes are applied to leveling the playing field, followed by greater pain for all (owners and renters) in the long run.

Such as alanhopkins suggestion to set interest costs aside on investment property, tried and failed by Keating in the late 1980’s, alan. The outcome was property owners simply increased the rental rates to the renters who had no where else to go and were stuck paying higher rents.

I guess when it comes to inter-generational conflict, I can afford to rent a young thug to sort out anyone anticipating an intergenerational conflict which might be headed my way, I am sure they would be pleased to earn any extra they can (oh this thread is too much of a joke to take seriously).

My daughter is 26, buying her second property. She has worked hard and done it all herself.

Those folk who moan, would moan even if houses came free with cornflakes.

A few random thoughts.

Australia has not ever had a "baby boomer" Prime Minister.
The BB bubble will only last 10 years.
The majority of BB's had no super until Hawke/Keating.
BB's did not live at home when they were 25-30.

Generations Alphabet have exactly the same problems as all preceding generations and hard work, gaining skills and frugality are the answers, its called saving for yor future.

What a relief to find I can be reviled simply because I’m looking old and wrinkled. He also serves who only stands and waits.

As it happened, I started with nothing, and still have most of it left. At least I've got a label, and the comfort that some people can hate me just because I might be a homeowner.

But enough of this self-absorbed spawn-of-Spock stuff - let's do a bit of history:

In 1979, Leonie Sandercock published a little book called "The Land Racket: The Real Costs of Property Speculation" ISBN 0 908094 43 4 (available in second-hand stores somewhere, maybe). She notes in her introduction that land speculation and scandals have a long history in Australia and ought to be considered "The National Hobby".

Among other things, Sandercock discusses the Whitlam Labor Government, and notes that:
“Whitlam waged an election campaign in 1972 which focused on [urban development] and promised to reduce the price of land and housing, overcome the sewerage backlog, channel money into updating urban public transport (rather than into building freeways) and concentrate resources into the ‘deprived areas’ of the big cities - ..”

She then discusses the difference between the reception, in Victoria and South Australia, of Whitlam and Uren’s Urban and Regional Development plans.

I’m sure other readers can put their two cents worth in on the Whitlam years, but it’s worth remembering that many of his supporters were baby boomers and some of them are probably renters, still.

The message here, (for spawn of spawn of Spock) is instead of blaming your landless condition on the dopey old bastard who maybe owns the place next to the one you maybe rent, do a bit of wider reading on the issue and try starting an intelligent conversation with a real person. He (or she) might tell you some history you haven't heard yet.

I have a daughter who is 29years old she is paying off a lovely home and has three rental properties and is having her fourth child next march. She is the main breadwinner, her husband works parttime. She left school after grade 10 because although she got excellent marks she hated school so I said if you can get a job you can leave. We tried a vocational course at Tafe first but at that point they wouldn’t let you do a training course unless you were 17years old.

My question to the author of this article and to all these under thirties complaining out there is ,What were you doing all those years my daughter was achieving this?
That girl has worked her butt off.

If you had had children in your early twenties, by your late thirties or early forties there would have been another generation ready to step into the workforce and the ageing babyboomers wouldn’t be such a problem.

Anyway this idea that everyone is going to live until they are 80 is talked up by the superannunation funds and the government for their own purposes. If you read the funeral notices in the paper over a year you’ll will find that there are still plenty of people dying in their 40’s 50’s 60’s and 70’s all the time.

Notice when Costello talks about the problem he talks about the year 2040 that’s 34years away. A lot of the present 50year olds and 60year olds and 70year olds will be well and truly dead by then. So it must be the younger baby boomers he is talking about.
Even if he was only talking fifteen years down the track a lot of the present older baby boomers would still be dead.

A bigger problem facing you young ones is going to be that because you have put off having children there will be noone to man the stations unless you are going to have doddery old people in the army or manning the hospitals etc.

Col Rouge, I can't believe that you're another otherwise intelligent person who's been deceived into believing that "17%" rubbish. That episode in history was over 15 years ago and in a very different economic climate to the one we enjoy today. I could easily say that just a few years before Keating's 17%, interest rates were at a high of over 22% and guess who was Treasurer then? None other than J W Howard, but that was back in the bad old days when interest was fixed by Government and money was rationed to lenders. It was Keating who actually freed up the market that eventually led to an historically low interest period, but just you wait until the present mineral boom comes to an abrupt holt as surely it will. We're presently in a financial bubble and it's growing bigger and bigger every day. There's going to be one hell of a bang when it bursts. Why do you think Howard is forcing unmarried mothers and those with disabilities off welfare? Same with IR laws. He's been advised of what's coming and is preparing for it the best way he can....by screwing the workers and welfare recipients AGAIN! And I say "advised" because Howard doesn't have the foresight to think any further than winning the next election. His "advisers" have to do that for him.

Though no prior planning I'm an asset rich (I’ve only ever owned one modest dwelling on a small holding) but income poor, (lower than the age pension) self funded, pre boomer, retiree, struggling to survive in today’s civilization paradigm.

This debate/discussion will soon become totally irrelevant as energy depletion (peak oil) causes recession and then the greatest depression of all time. This whilst we attempt unsuccessfully to deal with climate change at the same time. It used to be “the economy stupid” but soon it will be the “ecology stupid” as we struggle to survive, let alone buy a home, in a world critically short of the elements that ensure survival of the selfish big brained mammal; water and food and shelter from the soon rapidly changing elements.

Global and local economic growth, that has increasingly become the “name of the game” but only since we discovered and employed the “once only” bonus of fossil fuels a short 150 or so years back, is about to stall, beginning in the US, very soon. Economic growth will not, can not continue with out this once only energy bonus. Have a look at this:
http://www.informationclearinghouse.info/article15264.htm
Stop worrying about buying houses and start worrying about surviving in a very different environment. Get focused on that which matters. The alternatives to “oil” are totally inadequate to support our current western lifestyles.

Oo roo,

Bucko

The baby boomers wealth will transfer to the younger generations probably starting around now and for the next 10-30 years. After all they can't take it with them - although they can take their knowledge if they don't pass it on.

As they draw down on their investments/houses/shares they will pull massive amounts of money out of the market causing the prices to drop. This will also be because younger people will not have as much equity and will not be able to (or unwilling to) go even further into debt than they already are.

I ask you the question what happens when the market has 106% mortgages - the market can ONLY go up with income growth and has a large downside risk.

I agree it can be tough to Gen Xers to get a start in housing. But it's also a bit tough blaming the boomers. This boomer got started in the market by going without. Yeah, I know that sounds boring, but it's true - no lattes, no takeaways, no new technology, no holidays, no concerts, until we saved for the deposit on a low cost house way out in the non-blue ribbon 'burbs. Did the long commute into work in a clapped out Toyota Corona. Traded up houses through the years and finally paid off the mortgage. Can't speak for the rest of Australia, but in Brisbane you can still do the same today.

Tough? For a gen X to start in housing?

What on earth gave you that idea?

Yes! I know that, if they actually rent, then the inner suburbarn terraces that they occupy are worth over half a milion for a cheapie.

But lets get back to reality.

The gen X who has left school at 17 and done an apprenticeship. And is now 29 and stil living with mum and dad and paying minimal board.

Income at least, 70 grand. Cashed up Bogan!

Even after taxes, compulsoury super, and living expenses a savings rate of ten grand a year is easy and twenty a year quite possible.

Now forget the terrace. The smaller, non quarter acre house and land packages on the outskirts start at 200 grand. Ten years living at home and the gen X can pay CASH for a house. NO baby boomer even contemplated the idea for a first home.

With no interest the same gen x can keep saving to a second investment home by 40 and a third by 47, (income from the investment home) and so on to age 55. Thats first bite at the super. Five investment properties by that age is quite feasible.

Many of the baby boomers had no option but to leave home age 15 to find work. Rent till 25 and saved deposit and then pay mortgage till age 45. Only then think about ONE investment property.

An excellent article this is. This greed of buying up housing has done nothing but pit people against one another, forcing more and more people onto the streets so one group of people make a fistful of dollars.

Such is the curse of the Baby Boomer's who turn to dust whatever they touch. Destroying families, housing, freedoms, liberties, industry, the list goes on.

A cap must be placed on property investors so that they own no more than two houses/flats/units. It is all about being equitable and what is truly, the 'fair go'.

Wow Spider, grow up! Many of the baby boomers who have acquired a property portfolio have done so to provide a retirement income. There may be a few very wealthy people in there but the aussie battler is being hit with land tax, maintenance costs rates etc.

Sound a little vague, then lets use some real people.

Take Mr XXX, whose income in 1999, the last year he worked, was $35,000. He owned his home and 2 occupied rental properties. He was doing up a third house. He was self employed and had lost all his cash in the credit union and stock market collapse in 1990 so he had more faith in housing than shares.

Look at Mr XYZ who worked at sea all his life. He wasn't eligible for an Australian pension so he used his savings to buy 4 flats in Wollongong. He lives in one and rents 3 out. His land tax is $16,000 and his rental income is $36,000 - so he lives on about $14,000.

The baby boomer generation has been told that the old age pension will not exist and that they should provide for their own old age. The superannuation is like the wild wild west, full of sharks and regulated by incompetent gubment bureaucrats. [I am sounding like Col_Rouge - I think I know what his business is!] The consequence is that many people are ripped off by poor financial advice from so-called professional advisors at the end of their working lives, so many people prefer to DIY retirement income from property.

I know 40 year olds on combined incomes of $120,000 who claim they can't afford to buy a house. Many property owning baby boomers scrimped and saved to get their rental portfolio together.

The damage done by Damian's narrow and one-sided account regarding equity holdings - which goes "Ooh look some people have more equity than others, who can we blame for this and how can we fix it? Oh I know, make them give it back." As if we were all a bunch of school kids in a playground. - is that it encourages just the sort of victimisation we have now received from Spider.

Damian and Spider and a few others who are seeking to "bust the boomers" need to put their heads up and take a look around at the wider issues. They need to ask what else has been going on in an economy supported by government policies that are doing little or nothing to mitigate rising housing costs.

I doubt that an investment banker trading in equity has any idea of what goes on in the world other than knowing where the equity sits. Damian your argument is just way too simplistic.

Regards, Wal

Further to that...

In case what I've said has made Spider's hackles rise on the mistaken assumption that I'm just another greedy hoarder. I am 58. I own half of one humble house in a regional area. I have inadequate superannuation for my retirement and I plan to work until at least 70 if my health holds out.

Two of my children have jobs and are doing well, buying their own homes, at ages 30 and 31. As to the other one, my spouse and I between us are servicing a loan to pay for his education, secured by the equity in our house. Our key objective in life is to see that our three children do the best in life that they can. We have made many sacrifices throughout our lives to ensure this happens and will continue to do so.

It is possible Spider that you have not been so fortunate in your parents. If so, it's time to stop looking for scapegoats elsewhere and deal with your personal issues.

I'd say most Baby Boomers are like me, doing the best they can to survive in old age while putting as much of their resources as they can into ensuring the well being of the next generation. It would be nice to have a little more support from the government however that is no longer the world we live in. Australia is fast becoming a cut throat economy like the US where people have to beg for the money for an operation to save their loved one's life.

Regards, Wal

Ah Spider “A cap must be placed on property investors so that they own no more than two houses/flats/units. It is all about being equitable and what is truly, the 'fair go'.”

Is that one of the planks in your platform of “fascist” reforms ?

(recalling from your previous posts the mysterious political organization which you cannot name or talk about because it is still a “work in progress")

Since you concede to mention it here I assume it has been fully formulated.

So

Those who already own more than two properties, are their “excess of titles” to be compulsory purchased or simply expropriated by the state?

If they are to be “expropriated by the state” (recalling what happened to Jews in Germany in the mid 1930s) what is to be done with the proceeds of expropriation?

If they are to be compensated, how is such compensation to be funded? Maybe a fuel levy, Joan Kirner chose that when she raped the public to fund her governments deceit over its handling of Pyramid.

Who will “finance” the rental property market?

Forcing investors out of the rental property market, will result in an immediate reduction in the supply of rental housing which will lead to price increases, just look at bananas.
How much do you expect rental property rates to increase?

As for your suggestion that baby boomers “who turn to dust whatever they touch. Destroying families, housing, freedoms, liberties, industry, the list goes on.”

At this time the baby boomers are the parents and grandparents who brought children into the world, creating the families, not destroying them.

The baby boomers, according to you, are the owners of all the housing, so why would they be destroying that?

I believe people should be free to own whatever they want. You are the one who demands “A cap must be placed on property” so who is destroying “freedom and liberty”?

“Industry” is in a constant state of change, it is called “progress”, the alternative is “stagnation”.

Billie, Nice to see you and I standing on common ground.

He seems to have done it again, challenge a Policy statement by Spider, ask a question which requires more than a jingoistic one line answer; he abandons the debate and heads for the hills.

He has gone from an extremely strident position of suggesting to deny ordinary folk the right to invest as they see fit – by limiting them to a maximum of 2 real estate property titles (I should have asked if a couple are allowed 4 or is the 2 per family unit?), to not responding with some fairly direct questions about the immediate outcomes and obvious consequences of such a policy.

I am not sure which political group/party/movement he represents, I have asked him before and he evaded declaring the name of the “fascist” organization (he has previously admitted it is supposedly “fascist” in origin) which he is aligned with.

Well I guess one day we might find out who he is with, maybe when they are marching down Collins and Pitt Streets in a show of national solidarity or organizing torch lit processions to the rousing music of LRB (maybe not, some how marching in black or brown uniforms to “Time for a cool change” just does not do it).

In the mean time I guess it is “Democracy” as usual. As Old Winston (the fascists’ nemesis) said “Democracy is the worst form of government, except for every other form which has been tried”.

Col, settle down with a stiff whiskey or what ever it takes to relax your nerves, mate.

I'll let you know this; there is no actual 'political organisation' for there is no reason for form such an organisation until time is right. This stops those such as yourself from going on a a witch hunt like Tony Abbott did the the Westralian Democrats and the Hanson/Etteridge duo. No, we are not going to allow the powerfully corrupt organisations from making us political prisoners for their own ego's.

I was supposed to be a forerunner but I have taken a back seat for I have a degenerative neurological illness which has seen me less able to do things than I use two years ago. My wife now works and studies due to my health. So, it is unlikely you will ever see me running for office which is a shame for I was looking forward to putting the elites on the streets for all the ridicule and shame.

As for your Nazi-Jew comments, you need to attend less Semite party nights and release that holding atleast some fascist beliefs, does not equal Nazism. Yet, I see you unable to fathom commonsense in your tiny world of political paranoia.

Oh Spider, you must be a legend in your own lunchtime.

Re “No, we are not going to allow the powerfully corrupt organisations from making us political prisoners for their own ego's.”

What a hoot, nothing like your paranoia to build conspiracies on, of course the up side – you have just created your own instant justification for failure, blame it on those “powerfully corrupt organizations” or your degenerative illness. Personally, I rarely think on my medical challenges, it is belittling to dwell on them.

In the mean time, maybe you will answer the questions I raised about restricted property ownership – will you expropriate or compensate ?

And what will either happen to the proceeds or how will the compensation be funded?

So you were a “Forerunner”, looks like you slipped on your own shoe laces. Despite illness there must be more than you and your wife in your organisation, maybe not, seems a sad notion of an “organization”, at least your policy sessions should be easy to produce, no one else to argue the toss (or give a toss).

You are the one who called your organization “fascist” in the first place, or would you like me to fetch the exact reference to remind you?

So do not complain if I draw the obvious parallels, especially when you are talking about curtailing the democratic freedom of property ownership and what happened to the property of certain people in “fascist” Germany in the 1930s. Hitler funded his politics off the property (and gold teeth) of his victims, who is to say you would not do similar through the perversion of your rationalized “fascist” motives?

As for “in your tiny world of political paranoia”,
I identify publicly and proudly with the Australian Liberal Party and The British Conservative party.
You on the other hand, refuse to identify, by name, this “fascist organization” which you claim to have been a onetime “forerunner” for because you fear being made a “political prisoner” of “powerfully corrupt organisations” (your words above).

From where I sit, the “paranoia” would seem to be - all yours.

Col, I'm not going to enter into childish tit for tat tantrums with you. I'll leave that with you.

I tell you that I was once a member of the Liberal Party and I was part of the background within John Howard's factional support. You never saw my house with family photo's of John and his family sent to me by John Howard himself. Yes, those days are gone for I refuse to support Howard in any fashion anymore because who thought he would be a feudalistic PM.

You can ridicule my neulogical illness as much as you like for it only proves how Liberals are pushing the disabled into the gutter for you see us as rubbish to be tossed aside. While you lot behave like this, don't go calling me a Nazi.

Spider “You can ridicule my neulogical illness as much as you like for it only proves how Liberals are pushing the disabled into the gutter for you see us as rubbish to be tossed aside. While you lot behave like this, don't go calling me a Nazi.”

I am not ridiculing your neurological disease. I could not care what relationship you have to or with JH or any other Liberal party member. Martyrdom is not very becoming.

What I do care about is you have come here and proclaimed the imminent arrival of some new political wave of “fascism”, described as such in your own postings.

You have claimed you are the retired “forerunner” of that political wave.

You have declared a policy that people should not be allowed to own more than two properties.

You have refused to identify how you would either fund or implement that policy.

In the absence of any response by you to the direct question, I have fallen back on drawing a conclusion of my own which relates your “fascist” policy of restricting property ownership with the property ownership restrictions enacted by “fascists” in Germany in the 1930s.

When you are brave enough to tell us who you represent and when you actually answer the direct questions to your property ownership policy which I have raised, then I will not need to fall back on my own conclusions. Until then, your claims of being cast aside and suggesting I am calling you a Nazi are simply pitiful.

Do you have a policy position on how you will deal with dissenters when your new “fascist” regime is elected to or seizes power?

I ask because, if it is anything like the fascists who gained power in Germany in the 1930s, I will be one of those dissenters and need to order a good supply of yellow stars to sew onto my suits.

If you cannot or do not defend or expand on your stated position and policies, what else am I to assume?

OK, so I am a Generation X and I want to buy a house probably in the next 20 years that I can live in as a retiree. Do I buy it now, or wait for a possible glut of property in the future when all the BB's are trying to downsize? (I did own a mortgage but due to work and constant moving, it seems unwise to continue buying and selling every five years or so).

Ruze, I doubt whether prices will fall even when the BBs are cashing up. Likelyhood is bigger properties might get knocked down and redeveloped.

Re (I did own a mortgage but due to work and constant moving, it seems unwise to continue buying and selling every five years or so).

My 26 yo daughter is building her second property at present. Owning real estate is good way of acquiring an appreciating asset. I would suggest buying in and out of property market in short term bursts is not a viable strategy, but you know your circumstances better than I