Six months later and Mr McNamara from Australian Property Monitors is at it again. In a short piece titled “Rents in Australian cities will soar in the next four years” he once again singles out Gen Y as the cause of rising rents.
APM general manager Michael McNamara said rental supply was tight as a drum.
“As Gen Y leaves home and strong migration patterns take effect, our construction sector struggles to keep up the supply of well-located, affordable property to accommodate a growing population of renters,” he said.
Of course people are moving out of home, but to somehow come to the conclusion that because someone born post-1980 rather than pre-1980 will somehow impact the rental market more is simply ridiculous. There’s not some backlog of youngsters living at home that are all suddenly going to move out at once!
(source) (previously)
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Hrmm. It seems that the issue is either 1. getting more and more media attention, or 2. really is getting worse.
Whilst I agree that it isn’t a sudden influx of Gen-Yers moving out is causing the affordability of housing go down, it would be interesting to find data on the population increases in that bracket as opposed to housing growth.
Are these two factors growing at comparable rates? Is the sheer number of houses available not growing? What about those who die? Are people not dying at the same rates as before, meaning that they don’t ‘give up’ their houses for the younger generations to move into?
Being in Germany and hearing some of the rent prices for places here, its pretty scary at how expensive housing is in Australia. For example, a friend of mine purchased a very nice, large single bedroom apartment, with balcony only minutes from the city for only 60,000 Euro (roughly $100,000AUD). You would never find something like that in any of Australia’s major and non-rural cities. This is in comparison to a country which has quadruple the population as Australia!
I agree that the finding out some hard data would be much better than all this speculation about how many people are entering the rental market.
The thing is, there hasn’t been any form of population boom that is coming to maturity now - I think the birth rate has actually been declining. There’s no large body of young people about to all suddenly hit 18 years old and want to move out, so I don’t see how “Gen Y” can be blamed for rental prices increasing.
His argument may be that cultural differences between generations are placing stresses on the housing market in unexpected ways, but I haven’t seen it stated as such. An example is that young people may have a higher preference to inner city units than their parents did at the same age, and the supply of these units hasn’t kept up. But there’s not only a shortage of one type of dwelling but a general shortage, so that argument falls flat anyway.
I’m glad you’ve seen how cheap housing is in other parts of the world. My eyes were really opened when I went to Austin. It’s not until you see how the rest of the world lives then you can really understand how overpriced the Australian (and US and UK) housing market really is.
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