Restrictions on foreign ownership of housing would be welcomed in Australia
Australians have long been enthusiastic about property ownership.
By 1945, with a population of 7.39 million, 50% of Australians owned their own homes. The end of World War II saw Australian ex-servicemen, who had previously been living through the Depression, finally have a substantial bank balance due to receiving their accumulated military pay. Many turned that bank balance into their own part of the Great Australian Dream by purchasing a property.
Following the Baby Boom and the influx of 2.5 million migrants, by 1975 Australia had a population of 13.89 million with the trend of home ownership steadily rising to more than 70%. By 2015, the population was 23.79 million with 66% of Australians owning their own home, and this percentage has held relatively steady to date.
Australia’s median house price is currently $809,201, which in Sydney, will buy a house 50 km from the CBD.
Just across the ditch, our Kiwi cousins have also had a strong tradition of home ownership.
The country of New Zealand is 29 times smaller than Australia, and currently boasts a population of 4.7 million, with 65% owning their own home. A New Zealand government report has revealed that housing prices in that country have steadily risen by 60% in the past 10 years.
New Zealand’s median house price is $550,000, which will buy a 53 square metre one-bedroom apartment in Wellington, which is half of what you would expect to pay for an equivalent property in Sydney.
Last Wednesday, the New Zealand government introduced legislation to ban non-resident foreigners, other than Australians and Singaporeans, from buying properties.
This is perceived to be a move to protect the property market from spiralling out of control, as a result of bidding wars from wealthy international buyers, as has been the case in Australia. It will also allow local residents the opportunity to enter the property market, which has slipped to a 60-year-low for home ownership.
Such legislation would be welcomed here in Australia, where it takes a Sydney buyer 8.2 years to save $215,000 to purchase a median-priced house.
The Great Australian Dream has quickly become the Great Australian Nightmare.
But that’s just my two cents worth.
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