Rich parents, OnlyFans and ‘rare’ business wins are the only way young people can afford property in Sydney
As older generations reap the benefits of gargantuan price rises, young people are being forced to come to terms with Australia’s ugly new reality.
It’s official; Sydney is a city for the ultra-rich.
Anyone under 30 starting from ground zero may as well pack up and leave, with ordinary Australians saving for a house deposit until the age of 60, a property guru has warned.
As older generations of homeowners reap the benefits of gargantuan price rises, young people are being forced to come to terms with our ugly new reality.
For those who believe life is all about owning your own home, Australia’s biggest city has become a nightmare, especially in recent years as inflation whittles away the value of millions of regular Aussies’ savings accounts.
While we might be sounding like a broken record to those who’ve already paid off their properties, the fact is that young Aussies are now feeling cheated out of the system and feel as if they’re destined to rent until the end of time.
Real estate auctioneer Tom Panos, who has spoken extensively on the topic in recent months, dealt the rough news to the younger generation, especially people just entering the workforce with pennies in their bank accounts.
He said that if you’re not blessed with rich parents who capitalised on relatively low house prices in decades past, you will on average have to save for 20 years just to scrape together a deposit. And that’s just for a unit
It wasn’t long ago the average, single income Aussie family could pay off their house by the time they turned 60 and set themselves up for a modest but comfortable retirement.
“If you’re a young person now, and you have no money. A grand in the bank. It will take you 20 years to save for a deposit that’s going to allow you to comfortably buy in Sydney,” he told Mark Bouris on the Yellow Brick Road podcast this week.
“Obviously a little bit less for Melbourne and Brisbane. A house, if you’re age 20. It will take you until the age of 60 to get a deposit.
“Back in the old days, that was the goal to have your home paid off by then, not to be saving for a deposit.”
But now, Australia has quickly transformed into a nation of debt-laden middle-class taxpayers who are being forced to cut basic essentials from their budget to meet the most simple goals. Charities are reporting record numbers of people coming to them in financial distress, and the homelessness rate in New South Wales is on the rise.
Those who played their cards right to scrape together for a mortgage are now riding the line as interest rates drive up their monthly payments to the point where they feel they are forced to sell.
The exception, as always, is the bank of mum and dad. Panos says more often than not, young buyers are flanked by their parents at auctions.
With new data showing you need to earn roughly $300,000 to comfortably service a Sydney mortgage, it’s not hard to see why new homebuyers are leaning on their parents to get over the line and on the ladder.
Panos said you only needed to look at the average age Aussies are taking out home loans to see the problem.
The average Aussie was taking out home loans at 23 just 15 years ago.
That number has now soared to 32 in 2024 and will only rise higher as housing supply continues to be outstripped by demand, he explained.
“I’m seeing it,” he continued. “It’s uncomfortable for me to say, but the young people buying properties have their parents helping them, or if they’ve been really lucky with some sort of business that’s gone off.”
Then the penny dropped.
“OnlyFans, believe it or not!” he continued.
“I know a few people who have sold property and the agent has said to me ‘mate, she’s got an OnlyFans account and she’s putting it into property’.
“Isn’t it interesting, where we are as a society now, to achieve the dream we’ve always been told?”
In a recent video posted online, the real estate coach painted a bleak picture for the average cafe worker who he says would have to save vigorously for their entire life just to get a deposit together for the most basic of dwellings.
“See the guy behind us, I know what he’s making… $20 or $30 an hour, works his a*** off,” Panos said while filming himself getting a coffee at a cafe.
“If this guy starts saving up, he’ll be able to get a deposit for a property when he’s 63 years of age.
“Yeah, you’ve got everyone worrying about Brittany Higgins, and this guy is going to have to work for 45 years just to get a deposit.
“Look at what you’re making people do to buy real estate. Make the main thing … housing.”
The Australian Treasury says “nominal wages have picked up and are currently growing at the fastest rate in over a decade”.
A 0.9 per cent rise in the Wage Price Index in the December quarter means wages were 4.2 per cent higher through the year, marking the equal fastest annual growth since 2009.
But the demand for housing, especially in our capital cities, is still outstripping wages growth as prices push beyond what is reasonably achievable for Aussies earning an average wage.
Panos has also called out real estate agents who he says are capitalising on the crisis.
In a video posted earlier this month, Panos said a “small cohort” of agents were acting like bankers did before the global financial crisis of 2008.
“It was a money trail; do what you want, sell what you want, make money, don’t worry about the client,” he said. “This is going to be a party that’s never gonna end.
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“But at some point the hero moved from being the vendor, the client, and the real estate agent decides to become the hero.
“Including the way they acted, the way they behave, even the way they market it.
“In some properties, the way they market it, the agent is more marketed than the actual home. And it’s being funded by the vendor.”