The Perth Thread - Part 4

[blueboy25]

We were more egalitarian, which is why they all flocked here in the second half of the 20th century. I've got family friends that sound like sound like they are one day out of the Valleys that have been here longer than I've been alive. Not a chance in hell they would go back to the UK or they and their kids my age would've had the same quality of life they've enjoyed. I have heard of people in their 20s and 30s now emigrating to Australia then moving back which seems to be more common, but I don't know anyone personally in this boat.

I know a few families the have moved out here from the UK, missed home so moved back and then moved back to Australia again because they didn't realise how good they had it out here.

 

[Forward Press]

For all the faults - many of which deserve criticism - we have it pretty good here in terms of society, weather, opportunity, traffic, health care, education, standard of living etc.

There's no one else I'd rather be living right now and the COVID pandemic reinforced that.

 

[HitTheNailOnTheHead]

For all the faults - many of which deserve criticism - we have it pretty good here in terms of society, weather, opportunity, traffic, health care, education, standard of living etc.

There's no one else I'd rather be living right now and the COVID pandemic reinforced that.

Can't agree on the traffic bit I'm afraid. Are you NOR or South?

 

[Scotland]

It's difficult to develop more tradies because the stage of life when people are okay earning $24 an hour doesn't last very long.

Without a whole heap of people being able to come into the sector to provide competition, those who are fully qualified take the piss because they can.

People go to university for 3-5 years, do retail/hospo part time jobs and leave with $50k worth of debt. Thoughts and prayers to all Gen Z apprentices that aren't Project Manager on day one.

 

[Scotland]

Had the misfortune of going to Sydney last year. Perth traffic has nothing on that. Or Melbourne which is similar size but less shit.

Perth traffic stinks for what it is. But it's a city of 2.3m people who want to live like it's 1995 and there are only 1.3m people. Plus no one knows how to merge so having a freeway system is a bit redundant in terms of managing traffic flow. The Narrows could be 10 lanes each way and traffic would still be choked up by people slowing down to 30 because there's an on ramp at Mill Point Rd or doing 70 in the (far? heh) right lane.

 

[JackOutback]

This is what happens when you let in half a million new immigrants a year into a nation of 23 million. Not enough houses so prices and rents soar which is a large component of the CPI which the Reserve Bank uses when setting interest rates. Central Bank responds by jacking up interest rates, which increases the cost of living even more. I'm not against controlled immigration but apart from skilled workers in essential industries new immigrants should only be granted a visa on condition they reside in our dying country towns for 5 years rather than immediately clogging up freeways in our cities and contributing to astronomical house prices and rents.

Read my earlier comment about for every complex problem, there is an elegant, simple and wrong solution. Immigration has a small effect on the housing market but the problems here are structural, have been brewing for 40 years and are far more difficult to address and unwind, hence blaming the migrants instead. It's a dog whistle and it won't have any meaningful effect on house prices. Meanwhile, the health system will collapse as baby boomers move into aged care and hospitals en masse over the next decade.

 

[HitTheNailOnTheHead]

Read my earlier comment about for every complex problem, there is an elegant, simple and wrong solution. Immigration has a small effect on the housing market

I'm sorry. Letting 1/2 a million new people a year into a relatively low population country like ours with a shortage of housing and other structural issues doesn't have a small effect on the housing market.

but the problems here are structural,

I agree we have structural issues. Hence why we shouldn't be exacerbating the problem until those issues are solved.

have been brewing for 40 years and are far more difficult to address and unwind, hence blaming the migrants instead. It's a dog whistle and it won't have any meaningful effect on house prices. Meanwhile, the health system will collapse as baby boomers move into aged care and hospitals en masse over the next decade.

Telling the truth is not dog whistling. I'm not blaming migrants, I'm blaming the current immigration policy. We need to sort out the structural issues before we can sustain current immigration rates.

 

[Forward Press]

Of course having half a million people enter per year (effectively about 4% or so of the total population) causes issues, but he is right in that it tends to be a dog whistle for those with less savoury views on certain demographics.

The real cause - which no government wants to properly address - is that investing in property is seen as the optimum pathway to wealth, and the wealth is from charging the highest possible rents on as many properties as possible with the government providing you tax breaks and incentives for doing so.

The problem is solved overnight if you abolish negative gearing, but no government would ever do that.

Anyway, enough of my political ranting, back to Perth being a great place overall.

 

[Scotland]

One of the things that sucks about Perth (Australia in general) is the captive audience tax.

$13 for a beer at Red Hill Auditorium that is $60 a carton anywhere, so $2.50 a can. $16 for a premix vodka or bourbon and cola or whatever. I think they're about $4-5 each by the carton. There is no justification for a $10 markup on every can of drink sold.

Can see why people get put off going to concerts and festivals. Which sucks because when you are young enough that you don't need Nurofen because you slept funny the night before it's an awesome day out.

 

[HitTheNailOnTheHead]

Of course having half a million people enter per year (effectively about 4% or so of the total population) causes issues, but he is right in that it tends to be a dog whistle for those with less savoury views on certain demographics.

The real cause - which no government wants to properly address - is that investing in property is seen as the optimum pathway to wealth, and the wealth is from charging the highest possible rents on as many properties as possible with the government providing you tax breaks and incentives for doing so.

The problem is solved overnight if you abolish negative gearing, but no government would ever do that.

Removing negative gearing would have the opposite effect. Do yourself a favour and track what happened to housing supply in 1936 when negative gearing was introduced to counter the negative effect on housing supply caused by the Great Depression. Then look at what happened to housing supply and rental prices when the Hawke government substantially reduced negative gearing in 1985. The effect was so quick that they quickly reversed course and reinstated the incentives in 1987.

 

[Forward Press]

Removing negative gearing would have the opposite effect. Do yourself a favour and track what happened to housing supply in 1936 when negative gearing was introduced to counter the negative effect on housing supply caused by the Great Depression. Then look at what happened to housing supply and rental prices when the Hawke government substantially reduced negative gearing in 1985. The effect was so quick that they quickly reversed course and reinstated the incentives in 1987.

Completely different situations, back in the 'good old times' when a man could afford a house on a single income while supporting a wife and 2.3 kids. There is plenty of data out there (and real life examples) to demonstrate that. Now, housing supply is the critical point as it struggles to keep up with demand.

Negative gearing is a strong incentive to buy investment properties as pathway to financial security. Are you seriously suggesting that negative gearing improves housing affordability, because logically by giving tax concessions for renting out property it works the opposite way as buyers are more likely to rent it out than live in it, and the buyers want to maximise income from their asset - as demand goes up, the buyers of property can charge more rent. Simple. The abolition of negative gearing however would mean that for buyers of investment property, the incentive to rent out property is diminished as losses can no longer be used to reduce tax burdens, and more housing stock would become available as the tax breaks are gone.

Economics 101.

If you think that immigration has a substantial negative impact on housing availability but negative gearing does not, then I'd suggest your views are not grounded in economic reality but rather based on ideology.

 

[HitTheNailOnTheHead]

Completely different situations, back in the 'good old times' when a man could afford a house on a single income while supporting a wife and 2.3 kids. There is plenty of data out there (and real life examples) to demonstrate that. Now, housing supply is the critical point as it struggles to keep up with demand.

How does importing half a million new people a year that all need a roof over their heads help that situation?

Negative gearing is a strong incentive to buy investment properties as pathway to financial security. Are you seriously suggesting that negative gearing improves housing affordability, because logically by giving tax concessions for renting out property it works the opposite way as buyers are more likely to rent it out than live in it, and the buyers want to maximise income from their asset - as demand goes up, the buyers of property can charge more rent. Simple. The abolition of negative gearing however would mean that for buyers of investment property, the incentive to rent out property is diminished as losses can no longer be used to reduce tax burdens, and more housing stock would become available as the tax breaks are gone.

Economics 101.

Actually, research has found that:

• the provision of negative gearing in conjunction with the CGT discount promotes investment in rental properties and increases supply of new housing;
• around a third of all new dwelling construction is financed by investors every year, debunking the myth that negative gearing does nothing to support housing supply;
• removing negative gearing or the CGT discount altogether for property will dampen investment, diminish rental supply and make it more likely that in the short to medium term, rents and property prices will increase.

 

[Forward Press]

How does importing half a million new people a year that all need a roof over their heads help that situation?




Actually, research has found that:

• the provision of negative gearing in conjunction with the CGT discount promotes investment in rental properties and increases supply of new housing;
• around a third of all new dwelling construction is financed by investors every year, debunking the myth that negative gearing does nothing to support housing supply;
• removing negative gearing or the CGT discount altogether for property will dampen investment, diminish rental supply and make it more likely that in the short to medium term, rents and property prices will increase.

Immigration has an impact - I did not dispute that - just that it's overstated and the abolition of negative gearing would have a far greater impact on housing supply.

Of course negative gearing and similar policies increases supply insofar as builders are also not idiots and know that they can make easy money by building houses for investors to purchase, but if demand remains high then you don't need schemes such as negative gearing to encourage purchase of houses. Housing is one of those things that is inelastic (like petrol prices) where government intervention really does not move the needle much because people still need shelter no matter how much it costs. My philosophy is that we don't need to encourage further investment in the housing market and we should treat housing as a right rather than a commodity, but I am aware my thinking is not in line with neoliberal thoughts on it.

I'd rather see the continuation of policies to encourage builders to build (such as free TAFE for apprentices, cutting red tape for gentrifications etc) and abolishing policies encouraging investors eg redirecting the money saved from abolition of negative gearing towards incentives for higher density living, public housing etc. Again, aware it's not a popular school of thinking with our current governments.

 

[Forward Press]

Yes I know it's clickbait from a trash website (Yahoo7) but this is a prime example of the dire state of media at the moment.

It's recycling old info about the measures taken to combat polyphagous shot borer.

 

[Scotland]

Actually, research has found that:

• around a third of all new dwelling construction is financed by investors every year, debunking the myth that negative gearing does nothing to support housing supply;

This is actually not a good thing. You can't escape demand and supply forces but concentration of ownership is one of the main reasons why the housing market is a giant game of Monopoly.

If anyone's looking to downsize there is 9 bed 6 bath house on 2500 m2 for sale in City Beach from $20m.

 

[RookiePick]

This is actually not a good thing. You can't escape demand and supply forces but concentration of ownership is one of the main reasons why the housing market is a giant game of Monopoly.

If anyone's looking to downsize there is 9 bed 6 bath house on 2500 m2 for sale in City Beach from $20m.

Will probably get bought by a SEA investor and sit there empty.

 

[ioppolo]

View attachment 2475898

Yes I know it's clickbait from a trash website (Yahoo7) but this is a prime example of the dire state of media at the moment.

It's recycling old info about the measures taken to combat polyphagous shot borer.

They're not even trying to eradicate it anymore, so I'm not sure what this is supposed to achieve unless we're in perpetual agricultural quarantine

 

[Madas]

Would they spend it on social housing? Probably not. Could they spend it on social housing (and health and education and so on). Absolutely, but having the money in a sovereign fund like Norway is the first step. It is depressing watching countries like Norway and the UAE have cash to splash because they don't let resources money waltz out the door.

The bigger problem is that the government has facilitated a bubble where it can no longer afford to bring down house prices because it will leave a significant number of people who over-extended at risk of losing everything. So instead, they let the bubble get bigger and screw over the next generation.

I’d be very interested to see the knock on effect that may be had if they changed the negative gearing policy to building new stock only
It’s such a no brainer and ridiculous that they haven’t done anything about it while simultaneously watching house and rent prices go through the roof

 

[Bestbird]

I’d be very interested to see the knock on effect that may be had if they changed the negative gearing policy to building new stock only
It’s such a no brainer and ridiculous that they haven’t done anything about it while simultaneously watching house and rent prices go through the roof

I have this for many years yet here we are.

Governments should also abolish stamp duty to encourage retirees to downsize

Build social housing. It is good investment anyway and there is plenty of unproductive government land to fund it

Look more at re zoning laws to lessen the urban sprawl

 

[Madas]

I have this for many years yet here we are.

Governments should also abolish stamp duty to encourage retirees to downsize

Build social housing. It is good investment anyway and there is plenty of unproductive government land to fund it

Look more at re zoning laws to lessen the urban sprawl

Yes , yes , and yes

 

[Off The Couch]

I’m always interested to hear what this “downsizing” looks like and what the benefits are

Negative gearing should be limited to one or two properties - not 30

Stamp duty on houses (and cars) should be abolished

 

[Billy ray]

If people voted for hewsons 15% gst rather than Howard’s 10%, payroll and stamp duty would have gone

They cant do that now for both at 15% but could do stamp duty for 15%

 

[Beerfish]

payroll and stamp duty would have gone

 

[JHF1870]

I’m always interested to hear what this “downsizing” looks like and what the benefits are

Negative gearing should be limited to one or two properties - not 30

Stamp duty on houses (and cars) should be abolished

The problem is when houses all go up and you downsize. Your 750k ends up being much less especially if its an investment ptoperty with CGT.

 

[Shane Sheridan]

I recently sold my 4 x 2 in a leafy northern suburb due to the shit that went into the social housing in the house on my battle axe block. Was happy to downsize as its just me and the dog. Unfortunately, there was not a lot available, and I wasn't in a position to wait for something smaller or more suitable to come onto the market, so I've ended up in a house a lot bigger than I had previously.
At some stage I'll post about the reasons I moved, but for any NIMBY out there, I hear you 100%