Pericles, I take it you haven't recently tried to sell a property on the east coast of Australia?

I presume, foundation, that you are pointing out that it is currently difficult to sell property on the east coast of Australia.

If I have the wrong end of the stick, please let me know, but quite frankly it makes no difference to the point I am making.

If it is difficult to sell a property, it is because the price is too high.

Soon, this market resistance will lead to a lowering of prices.

(And boy, won't there be a wailing and gnashing of teeth among the commentariat when that happens! They will tell us, to a man, that it is the end of civilization as we know it.)

Conversely, if it is not difficult to sell a property, then the price must be right - a buyer and seller are reaching agreement on its value.

What does the government have to do with this?

They can tax the transaction harder. This will have the effect of reducing the dollar amount that the seller releases from a sale, which will either make them more reluctant to sell, reducing the stock and increasing scarcity, or force them to up the asking price, which will increase buyer resisitance and reduce the likelihood of a sale.

Or they can reduce or eliminate any transaction costs, which will increase the seller's take, and encourage more stock into the market.

But whatever they do or don't do, the point I was making is that every time a house is purchased, it is by definition "affordable" - someone has "afforded" it. Therefore, except for a scenario where there are zero market transactions, every house is by definition affordable - to refer, as PK did, to "housing unaffordability" is logically false.

Preicles, normally I am prepared to bow to your superior grasp of wisdom and knowledge, but not on this occasion I'm afraid. The fact that one person can afford to buy a particular house does not make it affordable in the general sense. Many others who would like to buy that house or another like it may not be able to afford it. Extending that over an entire city, the number of people wishing to enter the housing market but unable to afford to do so fluctuates, but there is always an element of 'unaffordability' in that market.

At the moment, house prices remain high over much of the eastern seaboard, deterring buyers, and the sluggish market therefore deters many vendors. You have correctly observed that eventually the price of houses will fall to a level of more general affordability, and this has been occuring for at least 2 years. Then, however, interest rate rises push the cost of purchasing up, so the downward price movement takes longer to bottom out. There is already a lot of anguish about this, but from highly-geared homeowners, not so much the comentariat as you suggest.

I dunno, having read that, you might responde saying, yes but, my point is.... Well, my point is, there is definitely such a thing as housing unaffordability, explained both as above, and when looking at long term trends. It is taking an ever-increasing multiple of average income to buy a house in Sydney.

Ludwig OK “and which can feed exorbitantly high profits into the pockets of those who are already rich and powerful? It’s a gross promotion of inequality”

The easiest way to relieve the exorbitantly high profits from the already rich and powerful is to increase the supply (flood the market) thus addressing / meeting / satisfying pent up demand and watching prices full. How come the Victorian State government is being criticized for land hoarding when it is supposed to be the friend of the unwashed?

PK – what you “buy” and “don’t buy” is a matter of personal choice. It is the socialists who always insist on telling people what they are allowed to buy and not buy and where they are allowed to buy it. I speak from common sense and respect for individual rights, that those views are represented by only one side of politics is “coincidence”.

As for “It is taking an ever-increasing multiple of average income to buy a house in Sydney.”

And prices are falling in Sydney, so it must be getting easier for some somehow and the ever-increasing is in fact, diminishing.

Col

“The easiest way to relieve the exorbitantly high profits from the already rich and powerful is to increase the supply (flood the market) thus addressing / meeting / satisfying pent up demand and watching prices fall.”

Yes. But stuff that!!

The last thing we want is virtual open slather on land releases, for reasons explained in previous posts on this thread.

It’s well and truly time to head directly towards a sustainable existence on this continent, and that necessitates dealing strongly with the demand side of the equation and not just the supply side….with all sorts of issues.

So let’s start thinking about reducing the primary driver of housing expansion - population growth, implementing disincentives for those who wish to move into crowded or growth-stressed cities and regions, and various other financial arrangements to even up the balance of wealth between the first-home buyer and the developer/profiteer.

The last thing we should be doing is just freeing up land releases and ignoring the rest. If a bit of a freer land-release program was implemented as part of an overall strategy, which included measures to limit the extent of suburbia, then fine. But not in isolation.

Col, you have avoided answering most of the points I made in my posts on this thread, but that's OK. However I resent you taking my last point out of context. I was making the point that as a long-term trend, housing is becoming less affordable when compared to average incomes over the same long term. The figures don't lie about this.

You ignored the bit about the long term trend and tried to rebut my statement by relating it to the present short-term decline in prices. That kind of deliberate distortion is a cheap debating trick that you might be able to get away with when blustering away in person over a drink or two, but it's a bit bleeding obvious when you try it on it print, old fella.