Our obsession with property is pathological. Something’s gotta give

Forget AFL, Test cricket or the Sunday trip to Bunnings - investing in property is the greatest Australian pastime of all, and queuing for house inspections is our national sport.

With housing affordability now at its worst in more than 20 years and rents rising at their fastest pace in 15 years, the property market is both our national identity and shame. It consumes our daily conversations and captures our political leaders.

For young people, the Australian dream of owning our own home is now so far from reach we have resorted to sharing facetious memes about property – or ‘propadee’ as it’s known in these online circles – to cope.

It feels like something in the Australian property market has to give, and it probably won’t be the bank of mum and dad.Credit: Sam Bennett

With its origins on social media in the early 2020s, ‘propadee’ was once a phrase used by stock market investors and real estate bears to ridicule property investors, whom they thought were lemmings piling into a housing bubble that never popped. These days, the term is used ironically by the young to lament how housing prices “only ever go up” in Australia, making ownership increasingly unattainable.

These young property hopefuls blame “Hoomers” (not Boomers), who have property portfolios like the rest of us have share portfolios and have amassed massive wealth through capital gains on the back of doing basically nothing.

Hoomers consider houses (or ‘hooms’) as trading vehicles for wealth creation instead of a basic right involving shelter or a place to raise a family. They wake up every day asking themselves how they can access their super to negatively gear their seventh investment home.

We truly are the lucky country. By that, I mean that you need to be lucky and have rich parents help you outbid the other investors at auction.

Having successfully climbed the property ladder, they have pulled it up behind them, leaving half of Generation Rent (formerly Gen Z) living with our parents or fighting with our landlords over our rat-infested rental.

After pricing us out of the property ownership market, they tell us they are actually helping to provide supply to the rental market and then tell us to work harder if we want to purchase property.

But having a single well-paid job just doesn’t cut it anymore.

A Sydney home buyer now needs to earn more than $340,000 (after tax) to purchase the median-priced home with a 20 per cent deposit, an increase of $60,000 from March 2023, according to recent data sourced from Canstar and Domain. Thank god for the government’s new 5 per cent deposits.

“Today in places like Sydney, the amount of time and effort that goes into saving for a median house deposit could have very nearly bought an entire house outright back in 1970,” says Tarric Brooker, an independent analyst.

In the past five years, the median Sydney house price has risen 60 per cent to stand at a record $1.6 million, while in Melbourne it has risen just over 20 per cent to $1 million.

Consider that the median annual wage is roughly $80,000 and has only grown 3.9 per cent annually over the past five years, while in the last year alone the median Sydney house price rose 11.5 per cent.

These investors’ obsession with property is pathological (perhaps we could call it “Sydney syndrome”), with those captured by the property market spending all their time chattering about who bought what and for how much.

Our media is more than happy to feed this addiction, with recent (actual) headlines including: “Sydney home missing a large section of roof sells for almost $3 million” and“John was the only bidder for an auction. He still had no chance”.

We truly are the lucky country. By that, I mean that you need to be lucky and have rich parents to help you outbid the other property investors at auction.

“Only 13 per cent of homes for sale are affordable for a median income earner, meaning people on significantly above-median incomes are competing for what used to be low-end homes,” says Brooker.

How did we get to the point where kids are openly discussing how they are itching to go house-hunting as soon as their parents drop dead, or whether a university education is worth the opportunity cost of getting on the property ladder? Affordable housing should be a right in a first-class society like Australia, but in 2024 we have tent cities appearing in Queensland.

Meanwhile, our politicians are caught between a politically influential investor class, maintaining a migration-based economy, and forever losing future generations of voters. They’re trying to fight the property dumpster fire with a hose connected to a petrol tanker, providing more grants, tax cuts and reduced lending requirements that only make the problem worse.

I don’t know about you, but it feels like something in the Australian property market has to give, and I don’t think it’s the bank of mum and dad.

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