It’s alright for Some!
How often have we heard the comment “It’s alright for some” when referring to a person’s luck? When we don’t have something, human nature leads us to think that is a little unfair that the other person has got it. Our property market reflects this emotional reality.
Presently, the whole market is geared, and the economic gurus’ directions are, to make housing more affordable for the young. It is doing everything to lower the price of property, so that entry becomes more accessible.
Unfortunately, whenever we tamper with the economy somebody else suffers. If you lower the property values, you will affect self-funded retirees.
The Government is faced with a difficult conundrum, that is, whatever direction they take, a part of the marketplace is weakened. If the Government utilises policies that drive prices down of property, those who bought property to have a good life in their retirement will lose out.
Let’s look at it another way; interest rates have been driven down to all-time lows in Australia. Exciting if you are a homeowner and paying off a mortgage. If you are a person in the twilight of your life who has saved carefully all your life, you will probably get 1.75% interest on your money in the bank. If your good on the Gee-Gees, you would probably do a little bit better.
It is true when we said it’s good for some. When something is happening, which benefits a part of our community, it is good for them, but not always good for others. The boom of 2014/16 benefited those who bought houses and held them for a long time but blew our kids out of the marketplace!
One of my young Solicitors’ asked me once upon a time “would it be so bad if we had a property crash?” I responded “only for some! For those of us that own property, and who rely on those values for their future, it is a disaster. On the other hand, for you kids who have lived your youth enjoying your money, its bloody perfect!”.
This article was written by Bailey Compton, Principal Solicitor & Director at Leverage Group.
Get in touch with Bailey:
✉️ firstname.lastname@example.org – ☎️ 1300 438 538