David Koch, the former Sunrise host and current economic director for comparison website Compare the Market, has pointed out something older Australiansmay not want to hear.

He has explained that younger Australians bear the brunt of soaring interest rates and inflation while their older counterparts remain largely unaffected.

The Australian housing market has been a hot topic of discussion for years, with prices skyrocketing and making it increasingly difficult for younger generations to enter the property market.

This issue has been exacerbated by the recent rise in interest rates, which according to Koch, has hit young borrowers the hardest.

It has been reported that younger generations have a hard time buying homes. Credit: Freepik

According to data from Compare the Market, homeowners who purchased property at the peak of the market in early 2022 are now finding themselves in a worse financial position each month compared to those who bought it three years earlier.

For instance, a Sydney homebuyer who purchased a property at the average price of $1.12 million in February 2022 and locked in a fixed rate of 2.2 per cent would now face minimum monthly repayments of $2,247 more than their current payment.

In contrast, homeowners who bought at the median price of about $780,000 in April 2019 on the same fixed rate have seen their repayments rise just $1,576 a month.

This means they are better off by $671 every month, or a total of $8,052 a year.

Furthermore, those who bought before the pandemic have benefited from a rise in equity as property prices have significantly increased over the past four years.

Koch has described this situation as a 'tough pill' for young Aussies who have not had time to save up.

'If you bought your home in early 2022 under the pretence that interest rates would stay low for longer, you've now been lumped with the short end of the stick,' Koch said.

'Meanwhile, a lot of mature Australians have missed this pain altogether after selling their properties at the peak and having reaped the benefits over more equity for years.’

'A lot of mature Australians have been shielded from the rate rises, and it's already widely believed that their spending drove inflation.'

A 2023 report from CommBank iQ found that spending among Australians aged over 35 appears to be fuelling Australia's inflation crisis as younger generations are forced to cut back on essentials.

Older generations were said to be going on holidays and dining out more often.

On the other hand, young Aussies were battling higher rents and mortgage repayments, reducing their spending to cope with the worst cost of living crisis in a generation.

Younger Aussies, particularly those aged 25 to 29, reportedly reduced their yearly spending.

Koch describes the current situation as a ‘tough pill’ for young Aussies. Credit: Freepik

Koch said, ‘It's time policy-makers should be asking: how could the pressure be more evenly spread?’

Many older homeowners have stressed that interest rates for home loans back then weren't as tough when looking at history.

In the late 1980s to early 1990s, home loan rates were a high 17 per cent, but today's variable rates are lower at six per cent.

They argued that the sacrifices young adults make now are incomparable to what they and past generations had to do.

However, Koch said new homebuyers are in a tougher spot than before.

For him, house prices had gone way up compared to what people earn, and this was happening faster than wages were growing.

'Back in the 80s, the average cost of an Aussie house was $70,000, now it's $700,000—ten times more expensive,' he said.

He explained that in the 1980s, the average salary was $19,000. In 2023, it was $94,000.

'So in the 80s, the price of a house was four times the average person's income,' he said.

'In 2023, it's eight times the average Aussie salary.'

He has also urged mortgage holders with higher repayments to call their banks and explore whether refinancing to a lower-rate loan is possible.

‘We urge people in mortgage pain to reduce the interest on their repayments as much as possible by shopping around for a better deal,' Koch said.

'When every dollar counts, 2024 should be the year of the new lender.'

The struggles of young Australians in the housing market are real and palpable.

Mira Almasri, a 35-year-old single mother, rents a one-bedroom apartment with her two children, aged nine and 14 in Mosman on Sydney's well-heeled north shore for $600 a week.

She has given up all hope of owning a Sydney home, stating, 'It's impossible to buy in Sydney.'

'Even if you earn loads of money, it's still hard. All my friends who have bought houses in the last two years say they are not happy at all because they are paying high-interest rates.'

Jacob Burrows, 22, an electrician from Perth, Western Australia, hopes to buy a property within the next 12 months despite interest rates being at their highest since 2012.

He has done a lot of research, including reading a book about a man who owned 30 properties by the age of 30.

However, he acknowledged that 'it's fairly hard at the moment because everything is so expensive’.

‘A couple of years ago, I wanted to try and understand the market to appreciate what's involved in buying a house,’ Burrows added.

‘I spent a year or so learning the housing market, and now I'm going to try to look for cheaper houses instead of buying one big one so that I can have a smaller deposit.'

Still, it’s not all rosy for older Australians.

On the other side of the spectrum, a report by Ageing in a Housing Crisis showed that having safe, secure, and affordable housing for older people has become increasingly difficult.

More older people also lived in marginal housing, as analysed by the Australian Bureau of Statistics census data and homelessness estimates.

The increase in housing costs, declining rates of home ownership, carrying mortgage debt into retirement, uncertainty in private rental arrangements, and the worsening shortage of social housing all indicate a widespread problem of housing insecurity.

This issue of insecure or unstable housing impacts people of all age groups. However, for older individuals, the challenges are exacerbated by factors such as limited income-earning potential, growing frailty, illness, caring responsibilities, an increasing need for at-home support, and age-related discrimination.

Key Takeaways

• David Koch delivered a stark message to older generations, pointing out how young Australians face struggles due to high interest rates and inflation.
• Research by Compare the Market indicates that recent homebuyers who purchased at market peak are financially worse off than those who bought homes several years prior.
• Older Australian homeowners have generally been cushioned from recent rate rises, having benefitted from increased property equity.
• Koch suggested that policymakers should consider ways to distribute economic pressures more equitably across generations.

Members, what are your thoughts on this issue? Share them with us in the comments below.

 

[Rob44]

Whether we like Kochie or not the figures he's quoting are statistically correct.
It was so much easier to get into the housing market when we were young, anyone who really wanted to could.
Those who didn't, in most cases was because of the life choices they made
Nevertheless we are not to blame for today's fiasco, we do not run the country, we don't make the laws, or handle the finances.
Don't blame us, or tell us that we shouldn't spend our hard earned cash if we want to. We went without when we were the young, to be comfortable in our old age
How about taking a swipe at the younger generation with thousand or more dollar mobile phones, fancy cars, overseas holidays, half a dozen credit cards, etc.
They are not happy to settle for a basic 3x1, they want to start off where their parents have ended up or even better.
They also get subsidised child care, maternity leave, first homebuyers grants etc etc, none of which our generation received. They ain't doing so bad

The first first-home buyers grant came into being in 1984.I remember because that was 6 months after I had bought my first home, correction, mortgage, in OZ, And, oddly enough, next year there was a jump in house-prices where I was living.

 

[Rob44]

I don't think it matters how old you are. Young ones can't earn enough to buy a place, rents are through the roof, probably because the landlords are mortgaged to the hilt. I also believe some of its greed. The I got it, you want it, you pay my price is rife in this country at the moment. Only got to look at supermarket prices and it runs across the board. Banks, landlords and real estate agents all vying for the highest prices. We live on a part pension, defence pension (you could not live on that one by itself and it's also classed as income so we can't earn even if we wanted to) and a couple of supplements. We still have a mortgage as we bought when we were older and renovated instead of paying off the mortgage. It has stood us well till now. Moved to a rural area, now want to go back to the city closer to family. Will probably have to down size majorly as we don't want to go into a retirement village due to our hobbies. Not catered for there. I doubt things will improve as nothing has over the last 50 years.

Others vying for high prices are tradies and companies that supply building materials

 

[Harry1913]

David Koch, the former Sunrise host and current economic director for comparison website Compare the Market, has pointed out something older Australiansmay not want to hear.

He has explained that younger Australians bear the brunt of soaring interest rates and inflation while their older counterparts remain largely unaffected.

The Australian housing market has been a hot topic of discussion for years, with prices skyrocketing and making it increasingly difficult for younger generations to enter the property market.

This issue has been exacerbated by the recent rise in interest rates, which according to Koch, has hit young borrowers the hardest.

View attachment 38953

It has been reported that younger generations have a hard time buying homes. Credit: Freepik

According to data from Compare the Market, homeowners who purchased property at the peak of the market in early 2022 are now finding themselves in a worse financial position each month compared to those who bought it three years earlier.

For instance, a Sydney homebuyer who purchased a property at the average price of $1.12 million in February 2022 and locked in a fixed rate of 2.2 per cent would now face minimum monthly repayments of $2,247 more than their current payment.

In contrast, homeowners who bought at the median price of about $780,000 in April 2019 on the same fixed rate have seen their repayments rise just $1,576 a month.

This means they are better off by $671 every month, or a total of $8,052 a year.

Furthermore, those who bought before the pandemic have benefited from a rise in equity as property prices have significantly increased over the past four years.

Koch has described this situation as a 'tough pill' for young Aussies who have not had time to save up.

'If you bought your home in early 2022 under the pretence that interest rates would stay low for longer, you've now been lumped with the short end of the stick,' Koch said.

'Meanwhile, a lot of mature Australians have missed this pain altogether after selling their properties at the peak and having reaped the benefits over more equity for years.’

'A lot of mature Australians have been shielded from the rate rises, and it's already widely believed that their spending drove inflation.'

A 2023 report from CommBank iQ found that spending among Australians aged over 35 appears to be fuelling Australia's inflation crisis as younger generations are forced to cut back on essentials.

Older generations were said to be going on holidays and dining out more often.

On the other hand, young Aussies were battling higher rents and mortgage repayments, reducing their spending to cope with the worst cost of living crisis in a generation.

Younger Aussies, particularly those aged 25 to 29, reportedly reduced their yearly spending.

View attachment 38954

Koch describes the current situation as a ‘tough pill’ for young Aussies. Credit: Freepik

Koch said, ‘It's time policy-makers should be asking: how could the pressure be more evenly spread?’

Many older homeowners have stressed that interest rates for home loans back then weren't as tough when looking at history.

In the late 1980s to early 1990s, home loan rates were a high 17 per cent, but today's variable rates are lower at six per cent.

They argued that the sacrifices young adults make now are incomparable to what they and past generations had to do.

However, Koch said new homebuyers are in a tougher spot than before.

For him, house prices had gone way up compared to what people earn, and this was happening faster than wages were growing.

'Back in the 80s, the average cost of an Aussie house was $70,000, now it's $700,000—ten times more expensive,' he said.

He explained that in the 1980s, the average salary was $19,000. In 2023, it was $94,000.

'So in the 80s, the price of a house was four times the average person's income,' he said.

'In 2023, it's eight times the average Aussie salary.'

He has also urged mortgage holders with higher repayments to call their banks and explore whether refinancing to a lower-rate loan is possible.

‘We urge people in mortgage pain to reduce the interest on their repayments as much as possible by shopping around for a better deal,' Koch said.

'When every dollar counts, 2024 should be the year of the new lender.'

The struggles of young Australians in the housing market are real and palpable.

Mira Almasri, a 35-year-old single mother, rents a one-bedroom apartment with her two children, aged nine and 14 in Mosman on Sydney's well-heeled north shore for $600 a week.

She has given up all hope of owning a Sydney home, stating, 'It's impossible to buy in Sydney.'

'Even if you earn loads of money, it's still hard. All my friends who have bought houses in the last two years say they are not happy at all because they are paying high-interest rates.'

Jacob Burrows, 22, an electrician from Perth, Western Australia, hopes to buy a property within the next 12 months despite interest rates being at their highest since 2012.

He has done a lot of research, including reading a book about a man who owned 30 properties by the age of 30.

However, he acknowledged that 'it's fairly hard at the moment because everything is so expensive’.

‘A couple of years ago, I wanted to try and understand the market to appreciate what's involved in buying a house,’ Burrows added.

‘I spent a year or so learning the housing market, and now I'm going to try to look for cheaper houses instead of buying one big one so that I can have a smaller deposit.'

Still, it’s not all rosy for older Australians.

On the other side of the spectrum, a report by Ageing in a Housing Crisis showed that having safe, secure, and affordable housing for older people has become increasingly difficult.

More older people also lived in marginal housing, as analysed by the Australian Bureau of Statistics census data and homelessness estimates.

The increase in housing costs, declining rates of home ownership, carrying mortgage debt into retirement, uncertainty in private rental arrangements, and the worsening shortage of social housing all indicate a widespread problem of housing insecurity.

This issue of insecure or unstable housing impacts people of all age groups. However, for older individuals, the challenges are exacerbated by factors such as limited income-earning potential, growing frailty, illness, caring responsibilities, an increasing need for at-home support, and age-related discrimination.

Key Takeaways

• David Koch delivered a stark message to older generations, pointing out how young Australians face struggles due to high interest rates and inflation.
• Research by Compare the Market indicates that recent homebuyers who purchased at market peak are financially worse off than those who bought homes several years prior.
• Older Australian homeowners have generally been cushioned from recent rate rises, having benefitted from increased property equity.
• Koch suggested that policymakers should consider ways to distribute economic pressures more equitably across generations.

Members, what are your thoughts on this issue? Share them with us in the comments below.

David Koch is an idiot to think he knows what people had to do when interest rates were 17%. Couldn't afford furniture so sat on boxes, no holidays, worked as many jobs as you could do(I had 2 during the week 9-5 and 5.30pm -3) 2 others at the weekend and lived where you could afford. What a joke

 

[Miss Chris]

I don’t think there are many young people, married or not, with children or not, who can buy the house they want or the car they want or anything else they want, first off….. it’s very hard to juggle the money and unfortunately most of today’s generations don’t want to do that but they are not ready for the commitment that owing money brings. They want it and they want it now….The older generations accepted that they could not have what they wanted until they could budget properly and make sure they could afford the payments for the house, the car…etc. ..(barring any unexpected circumstances) starting small until they could afford better. Who died and made Kochi lord of telling us what’s fair or not. But don’t you be telling the older generation that we had it better!!!!

 

[lovie dovie]

David Koch, the former Sunrise host and current economic director for comparison website Compare the Market, has pointed out something older Australiansmay not want to hear.

He has explained that younger Australians bear the brunt of soaring interest rates and inflation while their older counterparts remain largely unaffected.

The Australian housing market has been a hot topic of discussion for years, with prices skyrocketing and making it increasingly difficult for younger generations to enter the property market.

This issue has been exacerbated by the recent rise in interest rates, which according to Koch, has hit young borrowers the hardest.

View attachment 38953

It has been reported that younger generations have a hard time buying homes. Credit: Freepik

According to data from Compare the Market, homeowners who purchased property at the peak of the market in early 2022 are now finding themselves in a worse financial position each month compared to those who bought it three years earlier.

For instance, a Sydney homebuyer who purchased a property at the average price of $1.12 million in February 2022 and locked in a fixed rate of 2.2 per cent would now face minimum monthly repayments of $2,247 more than their current payment.

In contrast, homeowners who bought at the median price of about $780,000 in April 2019 on the same fixed rate have seen their repayments rise just $1,576 a month.

This means they are better off by $671 every month, or a total of $8,052 a year.

Furthermore, those who bought before the pandemic have benefited from a rise in equity as property prices have significantly increased over the past four years.

Koch has described this situation as a 'tough pill' for young Aussies who have not had time to save up.

'If you bought your home in early 2022 under the pretence that interest rates would stay low for longer, you've now been lumped with the short end of the stick,' Koch said.

'Meanwhile, a lot of mature Australians have missed this pain altogether after selling their properties at the peak and having reaped the benefits over more equity for years.’

'A lot of mature Australians have been shielded from the rate rises, and it's already widely believed that their spending drove inflation.'

A 2023 report from CommBank iQ found that spending among Australians aged over 35 appears to be fuelling Australia's inflation crisis as younger generations are forced to cut back on essentials.

Older generations were said to be going on holidays and dining out more often.

On the other hand, young Aussies were battling higher rents and mortgage repayments, reducing their spending to cope with the worst cost of living crisis in a generation.

Younger Aussies, particularly those aged 25 to 29, reportedly reduced their yearly spending.

View attachment 38954

Koch describes the current situation as a ‘tough pill’ for young Aussies. Credit: Freepik

Koch said, ‘It's time policy-makers should be asking: how could the pressure be more evenly spread?’

Many older homeowners have stressed that interest rates for home loans back then weren't as tough when looking at history.

In the late 1980s to early 1990s, home loan rates were a high 17 per cent, but today's variable rates are lower at six per cent.

They argued that the sacrifices young adults make now are incomparable to what they and past generations had to do.

However, Koch said new homebuyers are in a tougher spot than before.

For him, house prices had gone way up compared to what people earn, and this was happening faster than wages were growing.

'Back in the 80s, the average cost of an Aussie house was $70,000, now it's $700,000—ten times more expensive,' he said.

He explained that in the 1980s, the average salary was $19,000. In 2023, it was $94,000.

'So in the 80s, the price of a house was four times the average person's income,' he said.

'In 2023, it's eight times the average Aussie salary.'

He has also urged mortgage holders with higher repayments to call their banks and explore whether refinancing to a lower-rate loan is possible.

‘We urge people in mortgage pain to reduce the interest on their repayments as much as possible by shopping around for a better deal,' Koch said.

'When every dollar counts, 2024 should be the year of the new lender.'

The struggles of young Australians in the housing market are real and palpable.

Mira Almasri, a 35-year-old single mother, rents a one-bedroom apartment with her two children, aged nine and 14 in Mosman on Sydney's well-heeled north shore for $600 a week.

She has given up all hope of owning a Sydney home, stating, 'It's impossible to buy in Sydney.'

'Even if you earn loads of money, it's still hard. All my friends who have bought houses in the last two years say they are not happy at all because they are paying high-interest rates.'

Jacob Burrows, 22, an electrician from Perth, Western Australia, hopes to buy a property within the next 12 months despite interest rates being at their highest since 2012.

He has done a lot of research, including reading a book about a man who owned 30 properties by the age of 30.

However, he acknowledged that 'it's fairly hard at the moment because everything is so expensive’.

‘A couple of years ago, I wanted to try and understand the market to appreciate what's involved in buying a house,’ Burrows added.

‘I spent a year or so learning the housing market, and now I'm going to try to look for cheaper houses instead of buying one big one so that I can have a smaller deposit.'

Still, it’s not all rosy for older Australians.

On the other side of the spectrum, a report by Ageing in a Housing Crisis showed that having safe, secure, and affordable housing for older people has become increasingly difficult.

More older people also lived in marginal housing, as analysed by the Australian Bureau of Statistics census data and homelessness estimates.

The increase in housing costs, declining rates of home ownership, carrying mortgage debt into retirement, uncertainty in private rental arrangements, and the worsening shortage of social housing all indicate a widespread problem of housing insecurity.

This issue of insecure or unstable housing impacts people of all age groups. However, for older individuals, the challenges are exacerbated by factors such as limited income-earning potential, growing frailty, illness, caring responsibilities, an increasing need for at-home support, and age-related discrimination.

Key Takeaways

• David Koch delivered a stark message to older generations, pointing out how young Australians face struggles due to high interest rates and inflation.
• Research by Compare the Market indicates that recent homebuyers who purchased at market peak are financially worse off than those who bought homes several years prior.
• Older Australian homeowners have generally been cushioned from recent rate rises, having benefitted from increased property equity.
• Koch suggested that policymakers should consider ways to distribute economic pressures more equitably across generations.

Members, what are your thoughts on this issue? Share them with us in the comments below.

Are you kidding me Koshi we paid 18% interest when we bought our first home, plus my husband had 2 jobs, we only got Superannuation 10yrs before we retired. we were thrifty, we got our priorities right, we didn't complain about interest rates than bought ourselves coffee on our way to work and bought our lunch, we took them from home. and Maccas was a treat for our 3 children. I get sick and tired of people blaming us older generation for everything.

 

[Zorro56]

David Koch, the former Sunrise host and current economic director for comparison website Compare the Market, has pointed out something older Australiansmay not want to hear.

He has explained that younger Australians bear the brunt of soaring interest rates and inflation while their older counterparts remain largely unaffected.

The Australian housing market has been a hot topic of discussion for years, with prices skyrocketing and making it increasingly difficult for younger generations to enter the property market.

This issue has been exacerbated by the recent rise in interest rates, which according to Koch, has hit young borrowers the hardest.

View attachment 38953

It has been reported that younger generations have a hard time buying homes. Credit: Freepik

According to data from Compare the Market, homeowners who purchased property at the peak of the market in early 2022 are now finding themselves in a worse financial position each month compared to those who bought it three years earlier.

For instance, a Sydney homebuyer who purchased a property at the average price of $1.12 million in February 2022 and locked in a fixed rate of 2.2 per cent would now face minimum monthly repayments of $2,247 more than their current payment.

In contrast, homeowners who bought at the median price of about $780,000 in April 2019 on the same fixed rate have seen their repayments rise just $1,576 a month.

This means they are better off by $671 every month, or a total of $8,052 a year.

Furthermore, those who bought before the pandemic have benefited from a rise in equity as property prices have significantly increased over the past four years.

Koch has described this situation as a 'tough pill' for young Aussies who have not had time to save up.

'If you bought your home in early 2022 under the pretence that interest rates would stay low for longer, you've now been lumped with the short end of the stick,' Koch said.

'Meanwhile, a lot of mature Australians have missed this pain altogether after selling their properties at the peak and having reaped the benefits over more equity for years.’

'A lot of mature Australians have been shielded from the rate rises, and it's already widely believed that their spending drove inflation.'

A 2023 report from CommBank iQ found that spending among Australians aged over 35 appears to be fuelling Australia's inflation crisis as younger generations are forced to cut back on essentials.

Older generations were said to be going on holidays and dining out more often.

On the other hand, young Aussies were battling higher rents and mortgage repayments, reducing their spending to cope with the worst cost of living crisis in a generation.

Younger Aussies, particularly those aged 25 to 29, reportedly reduced their yearly spending.

View attachment 38954

Koch describes the current situation as a ‘tough pill’ for young Aussies. Credit: Freepik

Koch said, ‘It's time policy-makers should be asking: how could the pressure be more evenly spread?’

Many older homeowners have stressed that interest rates for home loans back then weren't as tough when looking at history.

In the late 1980s to early 1990s, home loan rates were a high 17 per cent, but today's variable rates are lower at six per cent.

They argued that the sacrifices young adults make now are incomparable to what they and past generations had to do.

However, Koch said new homebuyers are in a tougher spot than before.

For him, house prices had gone way up compared to what people earn, and this was happening faster than wages were growing.

'Back in the 80s, the average cost of an Aussie house was $70,000, now it's $700,000—ten times more expensive,' he said.

He explained that in the 1980s, the average salary was $19,000. In 2023, it was $94,000.

'So in the 80s, the price of a house was four times the average person's income,' he said.

'In 2023, it's eight times the average Aussie salary.'

He has also urged mortgage holders with higher repayments to call their banks and explore whether refinancing to a lower-rate loan is possible.

‘We urge people in mortgage pain to reduce the interest on their repayments as much as possible by shopping around for a better deal,' Koch said.

'When every dollar counts, 2024 should be the year of the new lender.'

The struggles of young Australians in the housing market are real and palpable.

Mira Almasri, a 35-year-old single mother, rents a one-bedroom apartment with her two children, aged nine and 14 in Mosman on Sydney's well-heeled north shore for $600 a week.

She has given up all hope of owning a Sydney home, stating, 'It's impossible to buy in Sydney.'

'Even if you earn loads of money, it's still hard. All my friends who have bought houses in the last two years say they are not happy at all because they are paying high-interest rates.'

Jacob Burrows, 22, an electrician from Perth, Western Australia, hopes to buy a property within the next 12 months despite interest rates being at their highest since 2012.

He has done a lot of research, including reading a book about a man who owned 30 properties by the age of 30.

However, he acknowledged that 'it's fairly hard at the moment because everything is so expensive’.

‘A couple of years ago, I wanted to try and understand the market to appreciate what's involved in buying a house,’ Burrows added.

‘I spent a year or so learning the housing market, and now I'm going to try to look for cheaper houses instead of buying one big one so that I can have a smaller deposit.'

Still, it’s not all rosy for older Australians.

On the other side of the spectrum, a report by Ageing in a Housing Crisis showed that having safe, secure, and affordable housing for older people has become increasingly difficult.

More older people also lived in marginal housing, as analysed by the Australian Bureau of Statistics census data and homelessness estimates.

The increase in housing costs, declining rates of home ownership, carrying mortgage debt into retirement, uncertainty in private rental arrangements, and the worsening shortage of social housing all indicate a widespread problem of housing insecurity.

This issue of insecure or unstable housing impacts people of all age groups. However, for older individuals, the challenges are exacerbated by factors such as limited income-earning potential, growing frailty, illness, caring responsibilities, an increasing need for at-home support, and age-related discrimination.

Key Takeaways

• David Koch delivered a stark message to older generations, pointing out how young Australians face struggles due to high interest rates and inflation.
• Research by Compare the Market indicates that recent homebuyers who purchased at market peak are financially worse off than those who bought homes several years prior.
• Older Australian homeowners have generally been cushioned from recent rate rises, having benefitted from increased property equity.
• Koch suggested that policymakers should consider ways to distribute economic pressures more equitably across generations.

Members, what are your thoughts on this issue? Share them with us in the comments below.

Good old wealthy Kochie Rabbiting on again. My wife and I both worked bloody hard to own our own home. We went without many things and still do. We did and still do buy secondhand items. We rarely eat out. We don't smoke and drink moderately. MY wife drives a 10yo vehicle and mine is 17yo. Compare that to my sons generation. Buy like hell on Black Friday, Uber Eats when your hungry. Buy a new car with a loan from the dealer. Designer clothes, shoes and sun glasses. I am not saying they don't have it bloody hard, and I am probably generalising, but stop blaming my generation for this and everything else that is wrong in the world. It all started long before us.

 

[Babbie]

Who wants nothing less than a tax-free existence. Taxes are a way of sharing a social burden to the benefit of all, as long as the politicians don't steal them for their "little mates".

All I was saying is NOTHING is free, it is paid for with taxes. What politicians do is another matter.

 

[Barbara V]

Thought we'd heard the last of him,now you have him popping up on this site not good

 

[weezza]

David Koch, the former Sunrise host and current economic director for comparison website Compare the Market, has pointed out something older Australiansmay not want to hear.

He has explained that younger Australians bear the brunt of soaring interest rates and inflation while their older counterparts remain largely unaffected.

The Australian housing market has been a hot topic of discussion for years, with prices skyrocketing and making it increasingly difficult for younger generations to enter the property market.

This issue has been exacerbated by the recent rise in interest rates, which according to Koch, has hit young borrowers the hardest.

View attachment 38953

It has been reported that younger generations have a hard time buying homes. Credit: Freepik

According to data from Compare the Market, homeowners who purchased property at the peak of the market in early 2022 are now finding themselves in a worse financial position each month compared to those who bought it three years earlier.

For instance, a Sydney homebuyer who purchased a property at the average price of $1.12 million in February 2022 and locked in a fixed rate of 2.2 per cent would now face minimum monthly repayments of $2,247 more than their current payment.

In contrast, homeowners who bought at the median price of about $780,000 in April 2019 on the same fixed rate have seen their repayments rise just $1,576 a month.

This means they are better off by $671 every month, or a total of $8,052 a year.

Furthermore, those who bought before the pandemic have benefited from a rise in equity as property prices have significantly increased over the past four years.

Koch has described this situation as a 'tough pill' for young Aussies who have not had time to save up.

'If you bought your home in early 2022 under the pretence that interest rates would stay low for longer, you've now been lumped with the short end of the stick,' Koch said.

'Meanwhile, a lot of mature Australians have missed this pain altogether after selling their properties at the peak and having reaped the benefits over more equity for years.’

'A lot of mature Australians have been shielded from the rate rises, and it's already widely believed that their spending drove inflation.'

A 2023 report from CommBank iQ found that spending among Australians aged over 35 appears to be fuelling Australia's inflation crisis as younger generations are forced to cut back on essentials.

Older generations were said to be going on holidays and dining out more often.

On the other hand, young Aussies were battling higher rents and mortgage repayments, reducing their spending to cope with the worst cost of living crisis in a generation.

Younger Aussies, particularly those aged 25 to 29, reportedly reduced their yearly spending.

View attachment 38954

Koch describes the current situation as a ‘tough pill’ for young Aussies. Credit: Freepik

Koch said, ‘It's time policy-makers should be asking: how could the pressure be more evenly spread?’

Many older homeowners have stressed that interest rates for home loans back then weren't as tough when looking at history.

In the late 1980s to early 1990s, home loan rates were a high 17 per cent, but today's variable rates are lower at six per cent.

They argued that the sacrifices young adults make now are incomparable to what they and past generations had to do.

However, Koch said new homebuyers are in a tougher spot than before.

For him, house prices had gone way up compared to what people earn, and this was happening faster than wages were growing.

'Back in the 80s, the average cost of an Aussie house was $70,000, now it's $700,000—ten times more expensive,' he said.

He explained that in the 1980s, the average salary was $19,000. In 2023, it was $94,000.

'So in the 80s, the price of a house was four times the average person's income,' he said.

'In 2023, it's eight times the average Aussie salary.'

He has also urged mortgage holders with higher repayments to call their banks and explore whether refinancing to a lower-rate loan is possible.

‘We urge people in mortgage pain to reduce the interest on their repayments as much as possible by shopping around for a better deal,' Koch said.

'When every dollar counts, 2024 should be the year of the new lender.'

The struggles of young Australians in the housing market are real and palpable.

Mira Almasri, a 35-year-old single mother, rents a one-bedroom apartment with her two children, aged nine and 14 in Mosman on Sydney's well-heeled north shore for $600 a week.

She has given up all hope of owning a Sydney home, stating, 'It's impossible to buy in Sydney.'

'Even if you earn loads of money, it's still hard. All my friends who have bought houses in the last two years say they are not happy at all because they are paying high-interest rates.'

Jacob Burrows, 22, an electrician from Perth, Western Australia, hopes to buy a property within the next 12 months despite interest rates being at their highest since 2012.

He has done a lot of research, including reading a book about a man who owned 30 properties by the age of 30.

However, he acknowledged that 'it's fairly hard at the moment because everything is so expensive’.

‘A couple of years ago, I wanted to try and understand the market to appreciate what's involved in buying a house,’ Burrows added.

‘I spent a year or so learning the housing market, and now I'm going to try to look for cheaper houses instead of buying one big one so that I can have a smaller deposit.'

Still, it’s not all rosy for older Australians.

On the other side of the spectrum, a report by Ageing in a Housing Crisis showed that having safe, secure, and affordable housing for older people has become increasingly difficult.

More older people also lived in marginal housing, as analysed by the Australian Bureau of Statistics census data and homelessness estimates.

The increase in housing costs, declining rates of home ownership, carrying mortgage debt into retirement, uncertainty in private rental arrangements, and the worsening shortage of social housing all indicate a widespread problem of housing insecurity.

This issue of insecure or unstable housing impacts people of all age groups. However, for older individuals, the challenges are exacerbated by factors such as limited income-earning potential, growing frailty, illness, caring responsibilities, an increasing need for at-home support, and age-related discrimination.

Key Takeaways

• David Koch delivered a stark message to older generations, pointing out how young Australians face struggles due to high interest rates and inflation.
• Research by Compare the Market indicates that recent homebuyers who purchased at market peak are financially worse off than those who bought homes several years prior.
• Older Australian homeowners have generally been cushioned from recent rate rises, having benefitted from increased property equity.
• Koch suggested that policymakers should consider ways to distribute economic pressures more equitably across generations.

Members, what are your thoughts on this issue? Share them with us in the comments below.

That’s absolute rubbish! GOVERNMENT SPENDING is the cause of high inflation, get real! People can’t afford to spend much, they are struggling to make ends meet and that includes some small businesses. When I bought my first home the interest rate was 17 %. The wages and the cost of living today are way out of balance.

 

[IAN3005]

Koshie should get back in his box and stay there.......

 

[Rob44]

The lack of housing is quite simply the result of Tory politicians since John Howard refusing to use our money (taxes) to build what is necessary to help those less well-off; PUBLIC HOUSING. Yes, that is the States' responsibility but our State governments all have a Tory mentality even if they are not formally LNP.

If Pommieland could build 200 000 Council Homes (public housing), or more, every year between 1945 and 1979 when the Tory witch, Thatcher, ended that programme, why couldn't/can't Australia? No money? Bullshit! This a large, minerals-rich country, unlike Pommieland.

Our grubby politicians must love this game of divide and rule between the young and the elderly!

 

[old and bold]

I am totally insulted with what Mr Kosh has said about we baby boomers in his opinion our spending had added to inflation. I was watching a story on people trying to attend Taylor Swifts concerts, It looked like millions of people there, ticket prices are outrageous AND I very much doubt there are any baby boomers in the audience. I can tell Mr Kosh he is very much out of touch and I doubt many young people could walk a day in the life of a young baby boomer. He is just another idiot amongst many

 

[lynstacker]

David Koch, the former Sunrise host and current economic director for comparison website Compare the Market, has pointed out something older Australiansmay not want to hear.

He has explained that younger Australians bear the brunt of soaring interest rates and inflation while their older counterparts remain largely unaffected.

The Australian housing market has been a hot topic of discussion for years, with prices skyrocketing and making it increasingly difficult for younger generations to enter the property market.

This issue has been exacerbated by the recent rise in interest rates, which according to Koch, has hit young borrowers the hardest.

View attachment 38953

It has been reported that younger generations have a hard time buying homes. Credit: Freepik

According to data from Compare the Market, homeowners who purchased property at the peak of the market in early 2022 are now finding themselves in a worse financial position each month compared to those who bought it three years earlier.

For instance, a Sydney homebuyer who purchased a property at the average price of $1.12 million in February 2022 and locked in a fixed rate of 2.2 per cent would now face minimum monthly repayments of $2,247 more than their current payment.

In contrast, homeowners who bought at the median price of about $780,000 in April 2019 on the same fixed rate have seen their repayments rise just $1,576 a month.

This means they are better off by $671 every month, or a total of $8,052 a year.

Furthermore, those who bought before the pandemic have benefited from a rise in equity as property prices have significantly increased over the past four years.

Koch has described this situation as a 'tough pill' for young Aussies who have not had time to save up.

'If you bought your home in early 2022 under the pretence that interest rates would stay low for longer, you've now been lumped with the short end of the stick,' Koch said.

'Meanwhile, a lot of mature Australians have missed this pain altogether after selling their properties at the peak and having reaped the benefits over more equity for years.’

'A lot of mature Australians have been shielded from the rate rises, and it's already widely believed that their spending drove inflation.'

A 2023 report from CommBank iQ found that spending among Australians aged over 35 appears to be fuelling Australia's inflation crisis as younger generations are forced to cut back on essentials.

Older generations were said to be going on holidays and dining out more often.

On the other hand, young Aussies were battling higher rents and mortgage repayments, reducing their spending to cope with the worst cost of living crisis in a generation.

Younger Aussies, particularly those aged 25 to 29, reportedly reduced their yearly spending.

View attachment 38954

Koch describes the current situation as a ‘tough pill’ for young Aussies. Credit: Freepik

Koch said, ‘It's time policy-makers should be asking: how could the pressure be more evenly spread?’

Many older homeowners have stressed that interest rates for home loans back then weren't as tough when looking at history.

In the late 1980s to early 1990s, home loan rates were a high 17 per cent, but today's variable rates are lower at six per cent.

They argued that the sacrifices young adults make now are incomparable to what they and past generations had to do.

However, Koch said new homebuyers are in a tougher spot than before.

For him, house prices had gone way up compared to what people earn, and this was happening faster than wages were growing.

'Back in the 80s, the average cost of an Aussie house was $70,000, now it's $700,000—ten times more expensive,' he said.

He explained that in the 1980s, the average salary was $19,000. In 2023, it was $94,000.

'So in the 80s, the price of a house was four times the average person's income,' he said.

'In 2023, it's eight times the average Aussie salary.'

He has also urged mortgage holders with higher repayments to call their banks and explore whether refinancing to a lower-rate loan is possible.

‘We urge people in mortgage pain to reduce the interest on their repayments as much as possible by shopping around for a better deal,' Koch said.

'When every dollar counts, 2024 should be the year of the new lender.'

The struggles of young Australians in the housing market are real and palpable.

Mira Almasri, a 35-year-old single mother, rents a one-bedroom apartment with her two children, aged nine and 14 in Mosman on Sydney's well-heeled north shore for $600 a week.

She has given up all hope of owning a Sydney home, stating, 'It's impossible to buy in Sydney.'

'Even if you earn loads of money, it's still hard. All my friends who have bought houses in the last two years say they are not happy at all because they are paying high-interest rates.'

Jacob Burrows, 22, an electrician from Perth, Western Australia, hopes to buy a property within the next 12 months despite interest rates being at their highest since 2012.

He has done a lot of research, including reading a book about a man who owned 30 properties by the age of 30.

However, he acknowledged that 'it's fairly hard at the moment because everything is so expensive’.

‘A couple of years ago, I wanted to try and understand the market to appreciate what's involved in buying a house,’ Burrows added.

‘I spent a year or so learning the housing market, and now I'm going to try to look for cheaper houses instead of buying one big one so that I can have a smaller deposit.'

Still, it’s not all rosy for older Australians.

On the other side of the spectrum, a report by Ageing in a Housing Crisis showed that having safe, secure, and affordable housing for older people has become increasingly difficult.

More older people also lived in marginal housing, as analysed by the Australian Bureau of Statistics census data and homelessness estimates.

The increase in housing costs, declining rates of home ownership, carrying mortgage debt into retirement, uncertainty in private rental arrangements, and the worsening shortage of social housing all indicate a widespread problem of housing insecurity.

This issue of insecure or unstable housing impacts people of all age groups. However, for older individuals, the challenges are exacerbated by factors such as limited income-earning potential, growing frailty, illness, caring responsibilities, an increasing need for at-home support, and age-related discrimination.

Key Takeaways

• David Koch delivered a stark message to older generations, pointing out how young Australians face struggles due to high interest rates and inflation.
• Research by Compare the Market indicates that recent homebuyers who purchased at market peak are financially worse off than those who bought homes several years prior.
• Older Australian homeowners have generally been cushioned from recent rate rises, having benefitted from increased property equity.
• Koch suggested that policymakers should consider ways to distribute economic pressures more equitably across generations.

Members, what are your thoughts on this issue? Share them with us in the comments below.

There is still affordable housing. People just don't want to live where they can afford. Why do I get the feeling that Kochie's agenda is about the company he works for. May I remind him that interest rates were 17.5% when I bought my first modest property in a less than desirable suburb and I was working 3 jobs to survive - without a TV, heating and a real bed. So I guess that wasn't tough

 

[Rey]

Damn.
Thought we had hear d the last of this clown!
Who really cares what Koch thinks?

Yeah I agree 1000% with you BruceC!!

I also never believe what this
“Clown”says!

In fact, the company, Compare the market, of which he is a director, offers a false, fake and misleading advertisement that says you can save “ $543” on your car insurance. I did their offer to get a quote. You know what?? The cheapest they can offer me out of ten quotes they showed, is a lot more expensive than my current car instance!!

I sent them an email disputing their claim, and a Cust Service Officer said will “provide your feedback to the relevant team for review..”

Until now, no comment receive from them!!

 

[Constance o6]

David Koch, the former Sunrise host and current economic director for comparison website Compare the Market, has pointed out something older Australiansmay not want to hear.

He has explained that younger Australians bear the brunt of soaring interest rates and inflation while their older counterparts remain largely unaffected.

The Australian housing market has been a hot topic of discussion for years, with prices skyrocketing and making it increasingly difficult for younger generations to enter the property market.

This issue has been exacerbated by the recent rise in interest rates, which according to Koch, has hit young borrowers the hardest.

View attachment 38953

It has been reported that younger generations have a hard time buying homes. Credit: Freepik

According to data from Compare the Market, homeowners who purchased property at the peak of the market in early 2022 are now finding themselves in a worse financial position each month compared to those who bought it three years earlier.

For instance, a Sydney homebuyer who purchased a property at the average price of $1.12 million in February 2022 and locked in a fixed rate of 2.2 per cent would now face minimum monthly repayments of $2,247 more than their current payment.

In contrast, homeowners who bought at the median price of about $780,000 in April 2019 on the same fixed rate have seen their repayments rise just $1,576 a month.

This means they are better off by $671 every month, or a total of $8,052 a year.

Furthermore, those who bought before the pandemic have benefited from a rise in equity as property prices have significantly increased over the past four years.

Koch has described this situation as a 'tough pill' for young Aussies who have not had time to save up.

'If you bought your home in early 2022 under the pretence that interest rates would stay low for longer, you've now been lumped with the short end of the stick,' Koch said.

'Meanwhile, a lot of mature Australians have missed this pain altogether after selling their properties at the peak and having reaped the benefits over more equity for years.’

'A lot of mature Australians have been shielded from the rate rises, and it's already widely believed that their spending drove inflation.'

A 2023 report from CommBank iQ found that spending among Australians aged over 35 appears to be fuelling Australia's inflation crisis as younger generations are forced to cut back on essentials.

Older generations were said to be going on holidays and dining out more often.

On the other hand, young Aussies were battling higher rents and mortgage repayments, reducing their spending to cope with the worst cost of living crisis in a generation.

Younger Aussies, particularly those aged 25 to 29, reportedly reduced their yearly spending.

View attachment 38954

Koch describes the current situation as a ‘tough pill’ for young Aussies. Credit: Freepik

Koch said, ‘It's time policy-makers should be asking: how could the pressure be more evenly spread?’

Many older homeowners have stressed that interest rates for home loans back then weren't as tough when looking at history.

In the late 1980s to early 1990s, home loan rates were a high 17 per cent, but today's variable rates are lower at six per cent.

They argued that the sacrifices young adults make now are incomparable to what they and past generations had to do.

However, Koch said new homebuyers are in a tougher spot than before.

For him, house prices had gone way up compared to what people earn, and this was happening faster than wages were growing.

'Back in the 80s, the average cost of an Aussie house was $70,000, now it's $700,000—ten times more expensive,' he said.

He explained that in the 1980s, the average salary was $19,000. In 2023, it was $94,000.

'So in the 80s, the price of a house was four times the average person's income,' he said.

'In 2023, it's eight times the average Aussie salary.'

He has also urged mortgage holders with higher repayments to call their banks and explore whether refinancing to a lower-rate loan is possible.

‘We urge people in mortgage pain to reduce the interest on their repayments as much as possible by shopping around for a better deal,' Koch said.

'When every dollar counts, 2024 should be the year of the new lender.'

The struggles of young Australians in the housing market are real and palpable.

Mira Almasri, a 35-year-old single mother, rents a one-bedroom apartment with her two children, aged nine and 14 in Mosman on Sydney's well-heeled north shore for $600 a week.

She has given up all hope of owning a Sydney home, stating, 'It's impossible to buy in Sydney.'

'Even if you earn loads of money, it's still hard. All my friends who have bought houses in the last two years say they are not happy at all because they are paying high-interest rates.'

Jacob Burrows, 22, an electrician from Perth, Western Australia, hopes to buy a property within the next 12 months despite interest rates being at their highest since 2012.

He has done a lot of research, including reading a book about a man who owned 30 properties by the age of 30.

However, he acknowledged that 'it's fairly hard at the moment because everything is so expensive’.

‘A couple of years ago, I wanted to try and understand the market to appreciate what's involved in buying a house,’ Burrows added.

‘I spent a year or so learning the housing market, and now I'm going to try to look for cheaper houses instead of buying one big one so that I can have a smaller deposit.'

Still, it’s not all rosy for older Australians.

On the other side of the spectrum, a report by Ageing in a Housing Crisis showed that having safe, secure, and affordable housing for older people has become increasingly difficult.

More older people also lived in marginal housing, as analysed by the Australian Bureau of Statistics census data and homelessness estimates.

The increase in housing costs, declining rates of home ownership, carrying mortgage debt into retirement, uncertainty in private rental arrangements, and the worsening shortage of social housing all indicate a widespread problem of housing insecurity.

This issue of insecure or unstable housing impacts people of all age groups. However, for older individuals, the challenges are exacerbated by factors such as limited income-earning potential, growing frailty, illness, caring responsibilities, an increasing need for at-home support, and age-related discrimination.

Key Takeaways

• David Koch delivered a stark message to older generations, pointing out how young Australians face struggles due to high interest rates and inflation.
• Research by Compare the Market indicates that recent homebuyers who purchased at market peak are financially worse off than those who bought homes several years prior.
• Older Australian homeowners have generally been cushioned from recent rate rises, having benefitted from increased property equity.
• Koch suggested that policymakers should consider ways to distribute economic pressures more equitably across generations.

Members, what are your thoughts on this issue? Share them with us in the comments below.

I feel sorry for young Australians but David Koch don't think for one minute that we older folks haven't, in our youth, gone through the same hardships. My parents and my husbands parents struggled to make ends meet. We did too in our younger years.

 

[NotNats]

Going on his comment 17% interest rate to buy a house at $70,000.00 ?? what a joke he really is get it right when I borrowed $50,000.00 to buy my block of land it was at 17.5% interest rate then I had to build a house on it and that was about 37 years ago now it is all payed off and at 70 years of age thank god for that, not to sure where this money bag idiot is coming from this is the man that earns well over a 100,000.00 per year and has done so for many years so not to sure where he gets his figers from but it sure is not the fault of the older gen to what is happening David get it right and donot blame us for it

We also were paying 17.5% interest back in the mid 1990's when we got our mortgage to build our home. But we were lucky we had nearly paid of the loan for the land.

 

[Jest]

David Koch, the former Sunrise host and current economic director for comparison website Compare the Market, has pointed out something older Australiansmay not want to hear.

He has explained that younger Australians bear the brunt of soaring interest rates and inflation while their older counterparts remain largely unaffected.

The Australian housing market has been a hot topic of discussion for years, with prices skyrocketing and making it increasingly difficult for younger generations to enter the property market.

This issue has been exacerbated by the recent rise in interest rates, which according to Koch, has hit young borrowers the hardest.

View attachment 38953

It has been reported that younger generations have a hard time buying homes. Credit: Freepik

According to data from Compare the Market, homeowners who purchased property at the peak of the market in early 2022 are now finding themselves in a worse financial position each month compared to those who bought it three years earlier.

For instance, a Sydney homebuyer who purchased a property at the average price of $1.12 million in February 2022 and locked in a fixed rate of 2.2 per cent would now face minimum monthly repayments of $2,247 more than their current payment.

In contrast, homeowners who bought at the median price of about $780,000 in April 2019 on the same fixed rate have seen their repayments rise just $1,576 a month.

This means they are better off by $671 every month, or a total of $8,052 a year.

Furthermore, those who bought before the pandemic have benefited from a rise in equity as property prices have significantly increased over the past four years.

Koch has described this situation as a 'tough pill' for young Aussies who have not had time to save up.

'If you bought your home in early 2022 under the pretence that interest rates would stay low for longer, you've now been lumped with the short end of the stick,' Koch said.

'Meanwhile, a lot of mature Australians have missed this pain altogether after selling their properties at the peak and having reaped the benefits over more equity for years.’

'A lot of mature Australians have been shielded from the rate rises, and it's already widely believed that their spending drove inflation.'

A 2023 report from CommBank iQ found that spending among Australians aged over 35 appears to be fuelling Australia's inflation crisis as younger generations are forced to cut back on essentials.

Older generations were said to be going on holidays and dining out more often.

On the other hand, young Aussies were battling higher rents and mortgage repayments, reducing their spending to cope with the worst cost of living crisis in a generation.

Younger Aussies, particularly those aged 25 to 29, reportedly reduced their yearly spending.

View attachment 38954

Koch describes the current situation as a ‘tough pill’ for young Aussies. Credit: Freepik

Koch said, ‘It's time policy-makers should be asking: how could the pressure be more evenly spread?’

Many older homeowners have stressed that interest rates for home loans back then weren't as tough when looking at history.

In the late 1980s to early 1990s, home loan rates were a high 17 per cent, but today's variable rates are lower at six per cent.

They argued that the sacrifices young adults make now are incomparable to what they and past generations had to do.

However, Koch said new homebuyers are in a tougher spot than before.

For him, house prices had gone way up compared to what people earn, and this was happening faster than wages were growing.

'Back in the 80s, the average cost of an Aussie house was $70,000, now it's $700,000—ten times more expensive,' he said.

He explained that in the 1980s, the average salary was $19,000. In 2023, it was $94,000.

'So in the 80s, the price of a house was four times the average person's income,' he said.

'In 2023, it's eight times the average Aussie salary.'

He has also urged mortgage holders with higher repayments to call their banks and explore whether refinancing to a lower-rate loan is possible.

‘We urge people in mortgage pain to reduce the interest on their repayments as much as possible by shopping around for a better deal,' Koch said.

'When every dollar counts, 2024 should be the year of the new lender.'

The struggles of young Australians in the housing market are real and palpable.

Mira Almasri, a 35-year-old single mother, rents a one-bedroom apartment with her two children, aged nine and 14 in Mosman on Sydney's well-heeled north shore for $600 a week.

She has given up all hope of owning a Sydney home, stating, 'It's impossible to buy in Sydney.'

'Even if you earn loads of money, it's still hard. All my friends who have bought houses in the last two years say they are not happy at all because they are paying high-interest rates.'

Jacob Burrows, 22, an electrician from Perth, Western Australia, hopes to buy a property within the next 12 months despite interest rates being at their highest since 2012.

He has done a lot of research, including reading a book about a man who owned 30 properties by the age of 30.

However, he acknowledged that 'it's fairly hard at the moment because everything is so expensive’.

‘A couple of years ago, I wanted to try and understand the market to appreciate what's involved in buying a house,’ Burrows added.

‘I spent a year or so learning the housing market, and now I'm going to try to look for cheaper houses instead of buying one big one so that I can have a smaller deposit.'

Still, it’s not all rosy for older Australians.

On the other side of the spectrum, a report by Ageing in a Housing Crisis showed that having safe, secure, and affordable housing for older people has become increasingly difficult.

More older people also lived in marginal housing, as analysed by the Australian Bureau of Statistics census data and homelessness estimates.

The increase in housing costs, declining rates of home ownership, carrying mortgage debt into retirement, uncertainty in private rental arrangements, and the worsening shortage of social housing all indicate a widespread problem of housing insecurity.

This issue of insecure or unstable housing impacts people of all age groups. However, for older individuals, the challenges are exacerbated by factors such as limited income-earning potential, growing frailty, illness, caring responsibilities, an increasing need for at-home support, and age-related discrimination.

Key Takeaways

• David Koch delivered a stark message to older generations, pointing out how young Australians face struggles due to high interest rates and inflation.
• Research by Compare the Market indicates that recent homebuyers who purchased at market peak are financially worse off than those who bought homes several years prior.
• Older Australian homeowners have generally been cushioned from recent rate rises, having benefitted from increased property equity.
• Koch suggested that policymakers should consider ways to distribute economic pressures more equitably across generations.

Members, what are your thoughts on this issue? Share them with us in the comments below.

if someone has 1.2mil they should be careful, but watching buyers it does not seem to be a problem. after all it is only a number.

 

[Jest]

if someone has 1.2mil they should be careful, but watching buyers it does not seem to be a problem. after all it is only a number.

i may add my parents went through 1930's depression and kept their farm . every generation has its ups and downs.

 

[janham]

David Koch, the former Sunrise host and current economic director for comparison website Compare the Market, has pointed out something older Australiansmay not want to hear.

He has explained that younger Australians bear the brunt of soaring interest rates and inflation while their older counterparts remain largely unaffected.

The Australian housing market has been a hot topic of discussion for years, with prices skyrocketing and making it increasingly difficult for younger generations to enter the property market.

This issue has been exacerbated by the recent rise in interest rates, which according to Koch, has hit young borrowers the hardest.

View attachment 38953

It has been reported that younger generations have a hard time buying homes. Credit: Freepik

According to data from Compare the Market, homeowners who purchased property at the peak of the market in early 2022 are now finding themselves in a worse financial position each month compared to those who bought it three years earlier.

For instance, a Sydney homebuyer who purchased a property at the average price of $1.12 million in February 2022 and locked in a fixed rate of 2.2 per cent would now face minimum monthly repayments of $2,247 more than their current payment.

In contrast, homeowners who bought at the median price of about $780,000 in April 2019 on the same fixed rate have seen their repayments rise just $1,576 a month.

This means they are better off by $671 every month, or a total of $8,052 a year.

Furthermore, those who bought before the pandemic have benefited from a rise in equity as property prices have significantly increased over the past four years.

Koch has described this situation as a 'tough pill' for young Aussies who have not had time to save up.

'If you bought your home in early 2022 under the pretence that interest rates would stay low for longer, you've now been lumped with the short end of the stick,' Koch said.

'Meanwhile, a lot of mature Australians have missed this pain altogether after selling their properties at the peak and having reaped the benefits over more equity for years.’

'A lot of mature Australians have been shielded from the rate rises, and it's already widely believed that their spending drove inflation.'

A 2023 report from CommBank iQ found that spending among Australians aged over 35 appears to be fuelling Australia's inflation crisis as younger generations are forced to cut back on essentials.

Older generations were said to be going on holidays and dining out more often.

On the other hand, young Aussies were battling higher rents and mortgage repayments, reducing their spending to cope with the worst cost of living crisis in a generation.

Younger Aussies, particularly those aged 25 to 29, reportedly reduced their yearly spending.

View attachment 38954

Koch describes the current situation as a ‘tough pill’ for young Aussies. Credit: Freepik

Koch said, ‘It's time policy-makers should be asking: how could the pressure be more evenly spread?’

Many older homeowners have stressed that interest rates for home loans back then weren't as tough when looking at history.

In the late 1980s to early 1990s, home loan rates were a high 17 per cent, but today's variable rates are lower at six per cent.

They argued that the sacrifices young adults make now are incomparable to what they and past generations had to do.

However, Koch said new homebuyers are in a tougher spot than before.

For him, house prices had gone way up compared to what people earn, and this was happening faster than wages were growing.

'Back in the 80s, the average cost of an Aussie house was $70,000, now it's $700,000—ten times more expensive,' he said.

He explained that in the 1980s, the average salary was $19,000. In 2023, it was $94,000.

'So in the 80s, the price of a house was four times the average person's income,' he said.

'In 2023, it's eight times the average Aussie salary.'

He has also urged mortgage holders with higher repayments to call their banks and explore whether refinancing to a lower-rate loan is possible.

‘We urge people in mortgage pain to reduce the interest on their repayments as much as possible by shopping around for a better deal,' Koch said.

'When every dollar counts, 2024 should be the year of the new lender.'

The struggles of young Australians in the housing market are real and palpable.

Mira Almasri, a 35-year-old single mother, rents a one-bedroom apartment with her two children, aged nine and 14 in Mosman on Sydney's well-heeled north shore for $600 a week.

She has given up all hope of owning a Sydney home, stating, 'It's impossible to buy in Sydney.'

'Even if you earn loads of money, it's still hard. All my friends who have bought houses in the last two years say they are not happy at all because they are paying high-interest rates.'

Jacob Burrows, 22, an electrician from Perth, Western Australia, hopes to buy a property within the next 12 months despite interest rates being at their highest since 2012.

He has done a lot of research, including reading a book about a man who owned 30 properties by the age of 30.

However, he acknowledged that 'it's fairly hard at the moment because everything is so expensive’.

‘A couple of years ago, I wanted to try and understand the market to appreciate what's involved in buying a house,’ Burrows added.

‘I spent a year or so learning the housing market, and now I'm going to try to look for cheaper houses instead of buying one big one so that I can have a smaller deposit.'

Still, it’s not all rosy for older Australians.

On the other side of the spectrum, a report by Ageing in a Housing Crisis showed that having safe, secure, and affordable housing for older people has become increasingly difficult.

More older people also lived in marginal housing, as analysed by the Australian Bureau of Statistics census data and homelessness estimates.

The increase in housing costs, declining rates of home ownership, carrying mortgage debt into retirement, uncertainty in private rental arrangements, and the worsening shortage of social housing all indicate a widespread problem of housing insecurity.

This issue of insecure or unstable housing impacts people of all age groups. However, for older individuals, the challenges are exacerbated by factors such as limited income-earning potential, growing frailty, illness, caring responsibilities, an increasing need for at-home support, and age-related discrimination.

Key Takeaways

• David Koch delivered a stark message to older generations, pointing out how young Australians face struggles due to high interest rates and inflation.
• Research by Compare the Market indicates that recent homebuyers who purchased at market peak are financially worse off than those who bought homes several years prior.
• Older Australian homeowners have generally been cushioned from recent rate rises, having benefitted from increased property equity.
• Koch suggested that policymakers should consider ways to distribute economic pressures more equitably across generations.

Members, what are your thoughts on this issue? Share them with us in the comments below.

 

[Clancieblue]

I'm sick of the finger pointing. I live in an area where despite increased property prices, there will not be enough to move or downsize anywhere should we want to sell. I have worked my whole adult life and even with 5 children was required to pay for everything medical without any financial assistance. I had no choice but to continue work while paying for a mortgage with rates at 17 percent plus. Because I worked, my children did not get any of the financial assistance that others received when they turned 16 and they were unable to get Austudy despite living away from home. Any family allowances did not come our way because I worked. So now I am retired with no mortgage and on a superannuation pension and still we struggle as my pension is the only real income. I see young couples struggle and I understand their pain. I cannot see for the life of me how they are expected to pay for million dollar homes. How is that possible? The finger pointing should be aimed at those who have benefitted the most - the banks, big corporations with huge profits, supermarkets and politicians and of course, greed.

Exactly Cathy we've all had our crosses to bear. It wasn't easy and we didn't complain all the time.
Didn't have two cars and a house full of new furniture. No mobile phones or internet. Handmade clothes and pass down shoes. No shelves full of books and DVD's, we went to the library, it was an outing.