The 2017 Federal Budget Hangover


Where We Are

The Australian property market is like a night club. Glitzy, glamorous, some wall-flowers hoping to get in on the action, and everyone drinking as much alcohol (properties) as possible to be with the ‘in crowd’.  Night clubs are about ME. Me being popular, me having a “great” time, me hooking up with the promise of pleasure.

Australia is stuck in the wrong paradigm (the nightclub), and the government and those giving advice are trying to solve the nightclub issues from within the club. Some of the solutions (to hangovers) being offered in the 2017 Federal Budget include:

Happy hour, increased supply of alcohol, clearer pathways to the bar, shorter bar height to help those who are vertically challenged, onsite brewery and smaller (and lighter) beer steins for the frail.

However, at the end of the night (this property cycle) when the ugly lights come on, everyone will still get that awful hangover…so everyone says…hopefully tomorrow night  when the government has come up with other ways to simplify access to the alcohol the hangover won’t eventuate. Hmmmm?!?

The issue isn’t the alcohol, it is the environment in which the alcohol is used and the abuse of the alcohol. The nightclub environment encourages sadistic narcissism.

A Better Place to Be

There needs to be a new environment where the alcohol is used responsibly. The place for alcohol to be served is at a BBQ with family and friends, where there is wholesome food, good communication, a safe environment and supportive relationships. An environment where positive outcomes are achieved. BBQs are about US, our relationships, our social support system, our life together, not about ME.

What is required to solve the issue of housing affordability is a paradigm shift and to realise that the solution to housing affordability exists outside the market. Housing as a human right can no longer be abused in the market (the Night Club). Instead housing needs to be taken out of the market – into community organisations that steward property (the BBQ). This way, properties serve US as homes, as opposed to individuals being slaves to houses hoping that by some stroke of luck, they will make ME wealthy without any consequences to the community. The best mechanism that I am aware of to achieve this, is through a community land trust (I might call it a Community Property Stewardship Group).

How to Get There

If you think a BBQ sounds better than a Nightclub, drop us a line and we can show you how to get one going.

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Housing market solution criples many

What does the housing market have to do with pumpkin plants?

When we had the deluge with blankets of water falling from the remnants of Cyclone Debbie a couple of weeks ago, the pumpkin plants in the backyard started to look very sad. However, the basil seemed to thrive. I was devastated (slight exaggeration), because prior to Debbie I had been watering the pumpkin sprouts every day and took great joy in seeing them grow (that is not an exaggeration – my wife would laugh every time I would take the girls outside to see how much the sprouts had grown). What I learnt from this was that what is good for one plant isn’t necessarily good for another.

Well, similarly, when a blanket rule is set by government regulators – whether they be Treasury, ASIC or APRA, the housing market in one location will respond differently to the market in another location . It is easy for government to damage localised economies (communities and families) with the flick of a pen! However, the government isn’t the problem, the market system in relation to housing is the problem.

In line with common thinking, the following quotes from today’s SMH article (click link) look at housing as a (speculative) commodity rather than as a human right…”The seeds of future slowdown are already well and truly sown. The better that NSW looks now, the greater the troubles that this state is storing up for the future,” the outlook warned.

“The joy of rising wealth eventually gives way to the pain of servicing gargantuan mortgages. Interest rates are beginning to rise around the world and although official interest rates in Australia may not follow suit until 2018, that augurs badly for the disposable incomes of Sydneysiders.”

Taking the profit motive and speculation out of home ownership, by putting properties in a Community Land Trust, ensures perpetual affordability and removes the need for government regulators to intervene. This in turn creates certainty in housing and community stability.

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