Rich Parents Shouldn't Be A Pre-Requisite To Buying A House
'Give up avocado toast. Spend less money on beer. Mooch off your rich parents'.
I read one of those articles yesterday. You know the ones, in any real estate section of any paper -- "young person shares secrets on how they started on the property ladder".
It features a photo of the beaming, proud young homeowner who has managed to buy up an apartment, in varying states of shabbiness, somewhere on the fringe of Sydney or Melbourne or Brisbane.
The details of the specific person aren't really important for the purposes of this article, because it's always some small variation on a theme -- young person gets a good job, pools savings with partner who also has a good job, sacrifices going out and drinking and avocado toast, moves back in with mum and dad to save on rent, and after a while, has scraped together a deposit for their own little slice of Australia.
Wonderful. Commendable. Happy for you, hope the housewarming party goes well.
The smug homeowner says something like "it goes to show that the property market isn't out of reach for people my age", and the implication is clear:
'If you aren't like me, you just aren't trying hard enough. Do better.'
But dig a few paragraphs deeper into this story -- any of these stories -- and another few common themes emerge. No matter how many nights they spent at home on the couch instead of at the bar, no matter how many loaves-worth of avocado toast they have foregone, no matter how much they saved from moving back in with the folks, very few of these young buyers have done it all on their own.
Most have had a very generous helping hand from someone, that many of us can't ever dream of receiving.
"Mum and dad went guarantor on the loan so we could borrow 100 percent of the house cost," one common answer goes.
"My husband's parents gave us a big loan to start us off," is another.
"I was helped out by an inheritance left by a generous relative," features too.
"Her parents let us stay rent-free in the spare room/granny flat/their investment property," pops up.
I (and many other young people) get upset by these stories, because they're framed as 'if you can't afford a house then you're just not trying hard enough'. When in fact, the story really is 'the only way most people can afford a house is if they have rich or supportive relatives'.
The 2016 census found the lowest overall home ownership rates since the 1954 census. In 30 years, the percentage of those aged 25 to 34 who owned their own home dropped from 58 percent in 1986 to 45 percent. There's something rotten going on here, and it's not just the smell of your morning kombucha.
Let's be real here: most people aren't able, or willing, to move back in with mum and dad to live rent-free, or to rely on their parents to guarantee a loan, or wait eagerly for a big wad of cash to be thrown at them from a dead uncle or generous benefactor.
I work in Sydney, and no matter how many times my mum in Wollongong reminds me I can come home and live in my childhood bedroom if I need to, it's just not feasible for me to do that. I work early mornings, late nights, get called in to cover sick colleagues -- living three hours from work isn't an option for me.
If you are the person who can move back home, whose parents luckily live somewhere near where you need to work and live, good on you and good luck.
But many people can't rely on that as a major avenue to home ownership.
What if your work takes you far from your childhood home, across the state or country? What happens if you don't have parents who would let you live with them? If you don't have parents still alive? If, god forbid, your parents don't just have a spare room waiting for an aspiring homeowner to move into?
Having parents who are financially stable, parents willing to let you pay little or no room and board, parents with a big house ready for you to set up shop in, shouldn't be a pre-requisite of home ownership in 2018. If you have some of these -- for the record, I do, aside from the aforementioned distance to work thing -- then great, and you've got a big leg up on many people.
But these stories aren't helping. Framing home ownership as simply a small hill to scale, needing only the occasional sacrifice of avo toast and staying at home a few more nights a week, isn't helpful -- when it's clear that the main factor in these media case studies scaling the property ladder is their luck to be born to a generous family, not their willingness to scrimp and save.
We like to bill ourselves as an egalitarian country, where your lot in life isn't solely dictated by where you grew up or who your parents are. But when your ability to secure a place to live and call your own -- one of the fundamental necessities of life -- is becoming increasingly dependant on having parents to mooch off, can we still think of ourselves as a fair and equal country?