People need to start spending less on other things if they want to own their own home. Australia's household spending is the highest it has been for 4 years, and it has reached 188.7% of income! About 30% higher than America's! This despite the lack of wage growth. Housing prices should be the least of the spendthrift's worries. They need to start being realistic.

Yes the young have been largely priced out of the housing market! And aided and abetted by various politicians of various stripes with anything but the prospects of the next generation of Australians at the front and centre of their limited attention span! And there are no innocent parties here, just self serving Quislings or totally inept tweedle dumb and tweedle dumber.

The quest for a bigger Australia has seen the migration program massively outstrip infrastructure roll out. Moreover there are far too many realtors totally dependant on commissions for every payday. And because there are far too many realtors in this area! Too much talked up over valuation and unrealistic vendor expectations.

Why at one time and on the Gold Coast there was one licensed real estate salesman for every 7 head of resident population. And a tendency of tourists and tyre kicker to run these folks around as a way to pass the time/beat boredom? Then there was the white shoe brigade building real estate portfolios, with other folks money!

There are as plain as the nose on your face solutions! But the folks with their snouts in this gravy train won't allow them! And unfortunately too many of them are totally self serving politicians just there for themselves and immediate families! And I know you know who most o these patent hypocrites are! TBC.
Alan B.

Cont: So, what can be done? Wel those who have presided over this debacle and PROFITED from it. need to be removed ASAP, as they are indubitably the very roadblocks in the way of affordable housing! Anything else will see the status quo continue or worsen.

The young folk that may well be still living in increasingly expensive rental accommodation or in the streets/beaches what have you, need to get up off of their complaining apathetic asses and FORMERLY vote for someone else! Rather than the mealy mouthed hypocritical incumbent, clearly part of the problem.

And give their FORMAL vote for someone with a few new ideas. The first being quite massive decentralization, the second being the roll out of publically or cooperatively owned AFFORDABLE energy generation and distribution.

What's affordable energy got to do with it? Absolutely everything! Not a single building product gets the the building site without a significant energy and transport component.

Thirdly and dependant on affordable energy is connecting rapid rail and the simultaneous rollout of truly affordable desalination. And that's why I'm forever banging on about THORIUM!

If only to ensure the decentralisation doesn't fail solely for lack of reliable water and that truly affordable desalination is deionisation dialysis desalination.

Last but not least there needs to be a two or three year pause in most migration with only family reunion and mail order brides allowed? And followed later by a significant migrant numbers reduction!

Some blokes are too old or too ugly to get anything but a complaint mail order bride and there are potent significant aged care saving on the public purse! Before allowing some long term assimilation, and or, nationalisation situations to proceed.

The shams will sort themselves out by being forced to wait for both permanent residency and later Australian citizenship, without which as divorcees? Automatically deported? And they will not make any demands on new housing!
Alan B.

Footnote: Finally, commissions and or commissioned salesmen need to be outlawed by legislation and replaced by salaried professionals/service providers. Even if fly by night operators scream blue murder as they see the pot of unearned gold disappearing before their very eyes!

This will ensure the prices are maintained at realistic levels and turnover replaces muscled up margins. And there simply has to be a capital gains tax, adjusted for inflation on the unearned capital gains accruing to housing!

This is the only way to lever the bricks and mortar mindset of some moribund investors out of the housing market and into far more productive areas!

Infrastructure perhaps?

The white shoe brigade acquiring massive windfalls at the expense of tradies, need to have their ill gotten gains, all of them, treated as thee proceeds of crime rather than legalized as now by inadequate laws or tradie protection/insurance!

And somebody else, i.e., and entirely independent, autonomous, incorruptible body, other than corrupt councils and or sticky fingered state politicians, need to be rezoning and releasing rezoned urban land I think that about covers it all?

And because I actually give a damn!
Alan B

"... just behind San Jose (Silicone Valley)."
San Jose is at the southern end of Silicon Valley - a region associated with the computer industry. I think the region associated with cosmetic surgery is much closer to LA.

"These figures indicate that if interest rates were to increase only marginally in the coming years, substantial numbers of borrowers would be in over their financial heads."
But conversely they show that the economy is more sensitive to changes in interest rates - so if they will rise, a much smaller rise will be needed.

The best long term solution to the problem is a broad based land tax, but implementing it without significantly disadvantaging existing house owners would take a very long time.

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ttbn,
"Australia's household spending is the highest it has been for 4 years, and it has reached 188.7% of income!"
Is that a typo? Or did you mean household debt?

Adian your impressive economic illiteracy is on display yet again. A land tax is a front loaded tax that has to further impact on house prices, already the highest in the english speaking world?

Yes, of course there could and should be genuine tax reform, that makes those currently avoiding a fair share of a common burden, pay a reasonable fair share. And designed in such a way as to make tax compliance costs null and void; and their impact/ripped out averaged 7% from the bottom line unnecessary!

After that planned and implemented decentralization, will along with AFFORDABLE ENERGY, put the economy and economic activity into turbocharged overdrive.

Even more so and without over stimulating harmful inflation! If we become an economy exclusively preferencing, cooperative capitalism comrade. With government facilitation and financing, professional and mandatory mentoring, plus intelligent use of start up tax holidays!

I was raised to believe common courtesy costs nothing!

So if you decide to reply Adian, leave out the abuse or the ignorant ill manners and routine elder abuse, that so marks your peculiar debating style, there's a good chap?

After all, I've used up my quota of comment on this particular thread and only a craven coward or worse, would use that as an opportunity to put the allegorical boot in. As seems your particular forte?

A man would take constructive criticism on the chin, like a man! Why can't you? Or is it Russian trolls, not here to help! Are alway both bellicose and belligerent?

You'll have a nice day now y'hear.
Alan B.

Yes, Aidan. I meant household debt.

'Yes the young have been largely priced out of the housing market!'

Where there's a will, there's a way....and I don't mean wishful thinking
Bleating is the excuse.

Alan B.,
What you regard as economic illiteracy on my part is actually a comprehension failure on your part. I don't mean a land sales tax; I mean a land value tax. Because people know they'll be paying the land tax, they wouldn't be willing to pay so much for houses, so house prices would fall.

And your "unavoidable" tax system would be very costly for business. They would find ways to avoid it, though, involving offshoring a lot of their activity.

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ttbn,
Considering most household debt is to cover the cost of the house, do you wish to revise your previous post?

Add to the household debt, the hidden debt of rent paid by lessees.

Not many (I would estimate), borrow money to pay rent, since rent is invariably paid from disposable income. However, that shifts the burden it is, onto borrowings to pay for other essentials through credit cards and personal loans.

Rent is a hidden debt to some degree, which should correctly be assigned to housing finance.
If this were done, we may achieve a more accurate “ realistic cost” of Australian housing overall.