Serious Aussie AMDKs Also Cannot Afford to Buy House - Sinkies Should Stop Complainin

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An honorable member of the Coffee Shop Has Just Posted the Following:

http://www.heraldsun.com.au/realesta...f95b7cdebba007

‘What hope do I have on $60,000?’
Jed Smith, news.com.au

SYDNEY nurse Damien Davis, 30, considers himself “really lucky.” In the city’s east, where he grew up and now rents, that equates to living in a tiny unit with four bedrooms, five people, one toilet and a cramped kitchen.

They rent privately off an old lady for $900 a week, which they split up between them (“a score,” he says). It’s agitating at times, especially after a nightshift dealing with aggressive drunks and drug addicts, but he refuses to complain.

“For me, I’ve been happy. The place has been great for what I need to do but (it) hasn’t had the possibility of savings for me. It’s been enough for me to live on, to rent, and to enjoy the things that I do in life, but not to save,” he says.

In order to save money he would be required to take “lots of extra shifts” meaning “spending all your free-time at work, which would be exhausting and result in a higher factor of burning out in my profession,” he says.

As a nurse Damien takes home around $60,000 dollars a year after tax, $11,000 of which he estimates is spent on rent.

In six years of fulltime 40 hour weeks he has managed to save $6000. He admits he could have saved more if he hadn’t taken an annual trip overseas but with house prices in his area averaging $2.1 million, or 35 times his annual income, it wouldn’t have made much difference. Even unit prices are above $1 million in his area and still well beyond his means as an everyday working class Australian.

Elsewhere in Sydney prices are less than in the East, but the average house still costs over $1 million.

“There are no pockets in Sydney that are affordable any more,” he says, adding that he is also worried about the longevity of his current lease. “We’re not going to be able to stay here forever and that is an obvious risk of renting around here if it keeps going through the roof,” he says.
Nurse Damien Davis represents what so many young Sydneysiders are dealing with. Picture: Danny Armstrong

The Sydney median house rent is now $540 a week. In the East, the average house rents for over $1000 a week. Damien thinks there should be more rights for renters and a cap put on rent in order to protect the many young Australians who are locked out of the housing market.

“It’s just not fair that rent prices are able to continue to go through the roof. And buying property … Sydney is just not a city where that’s possible for people who are not in that ultra-high income earning bracket to afford property, which pushes out the lower and middle class, which is a shame for society,” he says.

University of New South Wales Professor of Housing Research and Policy, Hal Pawson, agrees that the issue of renter rights needs just as much if not more of a focus than housing affordability.

“The media is obsessed with home ownership affordability and rarely discusses rental affordability. Nearly four fifths (78%) of low income private tenants pay rents exceeding 30% of income — thus pushing them into poverty (not enough cash left for basic essentials, once rent is paid),” he tells news.com.au.

The situation has been steadily declining, says Pawson, since former Prime Minister, Tony Abbott, “sadly scrapped” the National Rental Affordability Scheme (NRAS) in 2014.

The NRAS was an initiative by Kevin Rudd’s Labor government in 2008 to tackle homelessness and rising housing costs and was responsible for creating “38,000 homes across Australia which must be rented out at no more than 80% of the local market rent for at least 10 years,” explains Pawson.

Homelessness has ballooned by 33 per cent since 2011-2012 with a 14 per cent increase in 2015-2016 compared to the previous year.

“Only around 4% of Australia’s total housing stock is social housing (public housing and community housing) compared with, for example, 17% in the UK and 32% in The Netherlands. Social housing provision has remained virtually static since 1996 while population growth — and therefore housing need, is up more than 30%” says Professor Pawson.

Treasurer Scott Morrison is looking at a replacement program for the NRAS, though Pawson is sceptical of the Minister’s proposal.

“That definitely sounds like a very hopeful development, but the question is where would he find the ‘spending headroom’ to do it? The sensible answer is ‘by restricting negative gearing and the Capital Gains Tax Discount for landlord investors’. But since this has been ruled out there is a worry that he could be looking to extract a slice from the Federal funding currently paid to the states and territories to support (however inadequately) the cost of providing public housing,” he says.

Professional property investors make Ali Klinkenberg’s blood boil. He is another living and working in Sydney who is staring down the barrel of a lifetime of renting. He works around 50 hours a week as a magazine journalist in Camperdown, pulling in around $80,000 a year, half of which he estimates is spent on rent and bills.

He is particularly fed up with having his work ethic and ability to save questioned by the Baby Boomer generation and politicians like Barnaby Joyce, who have benefited from property investment laws that favour the wealthy and the established.

“I don’t know if you can necessarily blame them for doing so but it’s a little bit hypocritical for them to have bought one house and then used that as equity to buy another house and now they’re in their sixties or seventies and sitting on three or four properties, to then be saying our generation is lazy and they don’t want to work and all this, it’s bulls**t.

“We all still work. They just bought up all the property and forced housing prices up so high that none of us can get in there,” he says.

Thinking of buying a home? Take a look at what a million dollar home looks like in each Australian capital city.

What can $1 million buy in Aussie capital cities?


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