My fiancé and I are prospective first home buyers. We haven't yet saved up enough for a deposit (saving for a wedding etc). We are currently facing a dual threat. Threat #1 is that by the time we have our deposit saved up, interest rates will be on the up. Threat #2 is that when we are ready to buy, house prices will be beyond our reach.

House prices are rising because wealthy investors are locked into a relentless pursuit of MORE wealth. Whether they’re seeking negative gearing or capital growth or both, let's face it. It’s greed. We're talking about people who are already earning a reasonably high income, and who probably already own a fairly high-priced home. It is these people who are not satisfied. Their (your?) greed is the root cause of the affordability problem. Call it negative gearing, call it investor demand, whatever. It's greed, pure and simple.

The question was raised earlier, why change a system that is working perfectly well, just for the benefit of a small proportion of the population [i.e. first home buyers]?

Are the baby boomers having too much fun winning at the casino to think of their kids who are trapped in the car? This "I'm alright Jack" attitude betrays a general unwillingness to consider the plight of today's young people. We, who have inherited climate change, peak oil, the water crisis, the population crisis, and the general culmination of limits to growth. Greed is the root cause of all these crises too, and now my generation has to tackle them from the comfort of our rental homes.

To quote the Flying Pickets:
Let me ask you one question
Is your money that good?
Will it buy you forgiveness?
Do you think that it should?
I think you will find
When Death takes its toll
All that money you made
Won’t buy back your soul.

This post will doubtless be dismissed as "too emotional". That in itself will be quite telling: we are no longer allowed to be emotional. We must all be rational.

James, i like you have looked at the housing market in absolute despair. Affordablility is not an issue for me and my wife we are both in out mid twenties and earning a combined income of $110,000Pa. We chose not to committ ourselves to the average mortgage of $2300 a month for 30 yrs as well as combat all the incrimental costs, insurances, medicines (ihave a cronic illness) petrol etc to have some sort of financial freedom as we currently have no outstanding debts.

We were happy to see housing for what it is, a grossly overvalued and artificial form of proftiering. We had concluded that eventually the situation would get so out of control that the whole thing would come tumbling down like a deck of cards. That tumbling point technically should have come and gone around 18 months ago, but it hasnt. The reason for this, the whole system is designed for inevstors to keep on investing and rewards them for doing so.

I hate the Howard government for allowing this to happen. It served a political purpose for them, along with the boom from the west it allowed our economy to explode. No one seems to care that this explotion has happened on artificial terms, nor will they until it effects them. What they need to realise that one day it will, one day there won't be another investor standing there willing to pay an extra 30, 40, 50k because "Johnny" will pick up the shortfall. Heaven forbid this does all come crashing down, then again what will they care, by that time it will only still impact the younger generation like me and you James

Until then i will have to be content in raising my kids in an apartment or unit because your portfolio was much more important than me affording to give them a backyard to play in.

Reluctant + James,

I can really sympathize with your anger at the unaffordability of homes - good poem. I was in the same boat about 2 years ago, and now that I have a home (in Adelaide) I probably paid about $90,000 more than my home should cost. This is a debt that I am stuck with even if affordability improves.

I have always expected people (and companies) to try to make money whenever they can. What ticks me off is how the state government (primarily) has set up an uneven playing field by zoning land and restricting it's supply. People a generation ago didn't have this - it meant homes (relative to the current incomes then) were much more affordable. This is not to mention the astronomical stamp duties.