The banks have all been announcing profits in the past week or so and there has been plenty of profit to announce.
ANZ in Australia decided to tell us that they feared home ownership is becoming the domain of the rich, and upon hearing that the local CEO of the bank, Antonia Watson, entered the debate suggesting she thought the same thing.
Yet, we do this against the backdrop of first home buyers being represented by the largest presence in the market ever; 27% of all home sales go to first timers.
Are they all rich?
That, I guess, is your first question - what is rich?
Who decides what rich is? Is it kept simple by defining it by just house ownership?
We forget in our modern-day obsession that home ownership has always been hard. It doesn't mean you had to be rich, but it was always hard.
Chris Luxon's story in the campaign debate about him and his wife sitting in a furniture-less lounge in their first house painted the picture of many a first home buyer.
I was the same at the age of 18. I had a house but that was all.
There is some truth in the idea that expectation has changed. Once two or three beds with a bathroom would do, now it's two bathrooms and a good area for schools, or a deck, or some indoor-outdoor flow.
Then you've got the banks themselves, or at least the Reserve Bank. Needing 20% for a deposit in a major city is a couple of hundred grand. Now, that is hard. Harder than it needs to be.
5% is plenty. Housing is a very stable commodity in this country and if you are in a town or city where the average cost is $600,000, 5% is $30,000. That’s doable.
For better or worse, we obsess about housing. We think it’s a right, which it never was. But that’s part of the angst and that's why we obsess about prices and builds and consents.
The simple truth is for some, housing was always a stretch and always will be. But there are too many of us who started with barely anything, sacrificed hard, did our homework, bought smart and started the climb.
You want it? You can do it.
The 27% number tells you that is still the reality.
The rest, the commentary - that’s just rhetoric. You buy into that, you lose before you start.
Mike Hosking is a New Zealand television and radio broadcaster. He currently hosts The Mike Hosking Breakfast show on NewstalkZB on weekday mornings - where this article was sourced.
Yet, we do this against the backdrop of first home buyers being represented by the largest presence in the market ever; 27% of all home sales go to first timers.
Are they all rich?
That, I guess, is your first question - what is rich?
Who decides what rich is? Is it kept simple by defining it by just house ownership?
We forget in our modern-day obsession that home ownership has always been hard. It doesn't mean you had to be rich, but it was always hard.
Chris Luxon's story in the campaign debate about him and his wife sitting in a furniture-less lounge in their first house painted the picture of many a first home buyer.
I was the same at the age of 18. I had a house but that was all.
There is some truth in the idea that expectation has changed. Once two or three beds with a bathroom would do, now it's two bathrooms and a good area for schools, or a deck, or some indoor-outdoor flow.
Then you've got the banks themselves, or at least the Reserve Bank. Needing 20% for a deposit in a major city is a couple of hundred grand. Now, that is hard. Harder than it needs to be.
5% is plenty. Housing is a very stable commodity in this country and if you are in a town or city where the average cost is $600,000, 5% is $30,000. That’s doable.
For better or worse, we obsess about housing. We think it’s a right, which it never was. But that’s part of the angst and that's why we obsess about prices and builds and consents.
The simple truth is for some, housing was always a stretch and always will be. But there are too many of us who started with barely anything, sacrificed hard, did our homework, bought smart and started the climb.
You want it? You can do it.
The 27% number tells you that is still the reality.
The rest, the commentary - that’s just rhetoric. You buy into that, you lose before you start.
Mike Hosking is a New Zealand television and radio broadcaster. He currently hosts The Mike Hosking Breakfast show on NewstalkZB on weekday mornings - where this article was sourced.
4 comments:
So nothing to do with the sales being amongst the lowest in the last 20 years. The number of first home buyers, as a percentage, looks good because investors are holding back.
But why let the truth get in the way of a good story. Those poor youngsters should just work another job and walk to work.
This article is fundamentally flawed. The ratio of house prices to incomes is much greater now than it was in the 1950s-70s when 'ordinary' working people could get into a house - often on a single income at that - courtesy of the State Advances Corp. Now it takes a rich and generous Daddy to put a deposit down and two good incomes for 30 years to pay the mortgage off. An underclass of people who can never hope to get into a home has emerged in Australia and NZ. Rent-induced poverty is associated with numerous social ills including crime and dependency rates.
Mike Hosking is making the point that buying a home has always been about making sacrifices (consciously forgoing one thing in order to have another). That’s what homeowners have been doing for living memory.
I knew a lady who lived all her life in the (modest but solid) home she and her husband built after the war. They had to wait to get married because there was a housing shortage. There was a lot of scrimping, saving and making do in her story. She had a vege garden to feed her family until she was physically unable to at age 90+.
I know a young single man who has bought his first home by buying a large older home, having tenants living with him, even to the point of sharing his room. He has forgone his privacy in order build up his capital, which many of us wouldn’t be prepared to do. He also displays remarkable frugality in his life choices, to maximise the potential of his own earnings.
Buying anything is a matter of maximising your income by working as hard as you can and making choices about what you are prepared to forgo in order to have what you want the most.
Barend is corrct. Prices rise to what the amrket will stand and the now common professional working couples have set prices. In 1973 I bought a house in west Auckland; 800m2 section, 3 bedrooms, basement garage, copper plumbing, eaves,wooden floors, no cardboard or weetbix joinery $19,000. Two years earlier half that, about 5x a very good single income. Triggerd by a 20% general wage order which increased spending money far more than 20%. A neighbour with 3 kids, very basic job, wife at home moved into similar house new around 1967 when all in early 20s. But the income structure was then very compressed. Poms coming here from terrace housing thought they were in heaven, and they were.
The sudden price rise fostered the have/have nots situation which has been repeated sevral times since, and exaggertaed by the realisation that property safe and we addicted to immigration.
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