'Investor' is a dirty word for first-home buyers — but are they the real villains?
'Investor' is a dirty word for first-home buyers — but are they the real villains?
Margaret's property investment odyssey peaked at 40 properties. At the other end of the spectrum, first-home buyers Justin and Lana are accustomed to disappointment. So how do we solve Australia's housing affordability crisis?
Property investment is ingrained in the Australian psyche, but is it too easy to cast landlords as the villain in our housing crisis?
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Hoarding a scarce, essential resource to make money is villain shit, yes. Get a real job, Margaret.
That said, the real villains are politicians for not outlawing housing investment. Privileged opportunists will do it until it's illegal.
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That said, the real villains are politicians for not outlawing housing investment
Why would they implement something people don't want?
Bill Shorten went to the election with attempts to bring house prices down and lost an unlosable election
The liberal party have offered nothing to reduce house prices and they're in the lead to win the next election
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Yeah, that's right. I remember that campaign. A raft of actual progressive policies to address some of Australia's most pressing concerns... and it lost. It was a real turning point.
Houses are most people's primary investment. You can argue about whether or not that ought to be the case but it is the case and can't be readily undone.
While it's still getting harder to purchase your first house, everyone who already has a house has an interest in preserving house prices. I don't have the numbers to hand, but something like 60% of voting Australians live in a home they own, but fewer 20 to 30 year olds own homes than at any time in the last 50 years.
... that's a complicated way of saying things are harder than ever for first home owners but there's still no political support to address the core problems.
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Lowering house prices means loans are in danger of default. If a property is worth less than the loan you took out to pay for it, thrn banks start wanting you to close the gap between what you owe them, and what they can get if they take the house in lieu of payment. That's why you get cunce that overpaid and overloaned shitting themselves at the fact they may have to cough up the difference.
We need more supply. It's pretty fucking clear at this point that supply and demand are completely decoupled from pricing, so fuckit.
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That's not really how mortgages work.
If your house is worth less than your mortgage the bank can't just ask you to cough up. That's absurd really.
It's just that if you sell you can't settle the mortgage with the proceeds.
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Negative equity is absolutely a thing - and if a property with a 900k loan drops to 650,000 for example, then banks consider it a risk
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I'm not disputing either of those points.
banks start wanting you to close the gap between what you owe them, and what they can get if they take the house in lieu of payment.
This is absolutely false.
Some loans, "margin" loans, do work how you say and the bank will make a "margin call" asking the borrower to repsy a lump sum to reinstate the margin. However, this type of loan is not generally used to buy residential property.
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They’re not saying it’s not a thing, just that banks don’t call in the mortgage just because you’re in negative equity. It’s a problem if you try to borrow more or refinance.
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