-620x300w.jpg "Rising House Prices and Shrinking Living Spaces")
Australia has 4 housing markets out of the top 10 least affordable housing markets, according to Demographia’s recent International Housing Affordability Survey.
Sydney and Melbourne are amongst the top 10, with Sydney being the second least affordable major housing market, ranking only behind Hong Kong.
The survey also suggested that Australia’s ‘urban containment polices’ are to blame for the out of control prices. In essence, the policies prefer to create denser housing rather than developing new sites, and that this strategy has put almost all of Australia’s major housing markets in the ‘Unaffordable’ category.
Recent rumours suggest that the Chinese government have eased the restrictions on businesses bringing money out of the country. With many wealthy investors undeterred by the price hike, it will only bring more competition for local buyers, and continue to fill up the demand in Australian housing.
However, Chinese investors are not the main contributing factor in rising house prices. In 2015, foreign property buyers only make up for less than 19 per cent of all property sales across Australia. While there are some loaded foreign investors that are willing to pay a hefty premium for the property they love, the majority are still conscious buyers who can only wish if properties aren’t so expensive.
Currently, only 13 per cent of new home loans go to first home buyers, and most home loans are given to investors who have multiple properties. The current policies favour investors to utilise negative gearing, which allows them to reduce their taxable income. This strategy is still being implemented by investors today and it has only made the rich richer and the poor poorer.
“There is no way I am ever going to be able to afford a property in Sydney”, the consensus from current university students. “I will probably end up sleeping on the sofa in my parents’ place.” With the current housing situation coupled by constantly increasing competition for jobs, it is hard to blame students for losing hope so quickly when the ‘goal’ is so out of reach.
The urban containment policy has seen many new apartment complexes arise around the inner city. A new development in Marrickville is just one of the many newer dense apartment complexes to join the market.
With a denser, more convenient living means a reduction in living spaces. People are paying more money for a smaller living area. Suddenly, a 3 seater couch with a chaise that you wanted takes up the whole living area and you don’t want to buy that tiny yet expensive sofa at the local furniture store.
Don’t fret, as Desired Living offers a wide range of bespoke made lounges that can be customised to fit your living spaces. Whether you are in a luxurious mansion or a studio in the CBD, there is bound to be a lounge for you. Most importantly, the customisation reflects the price, so you are always getting your money’s worth!
Even if you can’t afford a house, you can still afford a glamourous lounge.
Have a tour on our website to find the next centrepiece for your humble abode!
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Image: @nk7
