The Game Is Rigged
In Australia, just like in the U.S.
I read a piece from The Guardian’s Australian edition that demonstrates an implacable reality:
NSW is New South Wales for those far from Australia.
The author, Greg Jericho, who is the chief economist of the Australia Institute, spells it out:
For many, though, regardless of what the figures say, the idea of being able to afford a house is so far beyond reality that they might as well envisage buying a place in a neighbourhood of hobbits.
Too often the difficulty is rendered in abstract terms, but the Australia Institute (where I am the chief economist) can now reveal just how cruel things are – and have been for many years.
He lays out a scenario where someone started saving 15% of a more than $100,000 income in 2015:
By the end of 2024, a decade after starting, you have saved up $126,096. Not only are you still not at your original goal, you are $155,404 behind the $281,500 deposit you now need to buy a median-priced house in Sydney.
The game — at least in Australia — is rigged. The answer is more housing, just as it is in the U.S.
Same in the UK. The Labour government are targeting 1.5M new homes but even if they make it, it will barely scratch the surface. It will take decades and require houses to stop being an asset class and become homes again. This is the wreckage of 40 years of neoliberal economics.