What’s driving the boom in Australian property prices? | Four Corners 

Why are houses now so costly and unaffordable?

Our biggest problem in Australia is that wealth creation is concentrated in the property market and not anywhere else. Our manufacturing, productivity, businesses and real economy has been decimated over the decades, and the spirit of enterprise has been suffocated in favour of speculation. When you turn to your house to make the money for you, you are in effect locking up energy and value in only the idea of a home, and not in producing goods and services for the community. It is therefore imperative that we restore actual wealth creation to restore parity between our contributions to community and the real value of our homes.

why do all real estate agents have such punch-able faces

The LNP MP said it's a failure on housing affordability. But he is in government. What is he doing to alleviate the issue? It is all lip service.

How did this not end with a link to a suicide support line after you spend 45 minutes telling young people they will never achieve their dreams and will always be a disappointment to the parents they still live with?

You know the counties in a mess, when young people start praying its markets collapse.

Housing is a business in Australia. The banks, govt, media, real estate agents, developers are all doing their best to inflate prices. There is no such thing as free market.

As a Canadian, some of our cities are experiencing the same problem. The solution is an end to foreign ownership (just the ones who live overseas), and a cap on how many homes a person can have as “investments,” and more state capital put into building low-income and cooperative housing. Also, tax corporations and the ultra wealthy sufficiently.

The Chinese had the one child policy. Its probably time Australia introduced the one house policy.

Rural northern California here. About 10 years ago, here in California and many other popular U.S. states, the housing market crashed really bad. Lots of people lost their homes. They had big mortgages, and their house values were diving big time. Lots of people could not sell their homes. Foreclosures and bank repossessions were happening left and right. The mentality PRIOR to this was, 'how can you go wrong buying a house?' Because next month, it would be worth more! Getting loans was crazy easy. Buyers and lenders were manipulating the numbers. Lots of buyers were speculating, and many were making a killing. People were just buying houses to make money, not to live in. And then "IT" happened. I started seeing notices (legal documents attached to the front doors and windows of homes) that homes were being repossessed, or were in foreclosure, or were being sold by the bank) on every street. Houses were becoming very affordable, fast. Foreclosure news was in the news every day. "Upside down" became the common term for people who could not sell their home because they owed the bank more than their house was worth, and the interest rate they were NOW paying (because those BAD variable interest rates were "killing" people) was more than they could afford. It was common for home owners?(you don't really own it until you finish paying for it!) to simply stop paying on their loans for months, some more than a year. Some people, lots of people actually, just walked away from their homes, just left them. Some just gave their keys to the bank. I'm 67, and have lived my whole life in California. I never imagined that "day" would come when home prices would drop, and drop big time. I saw it on my street, in my neighborhood, even in my quaint, rural little town where I thought we would be spared. Lots of people lost, and some people gained from the housing bubble bursting. I seriously doubt that the housing situation in Australia can continue on it's current path. It's like musical chairs. Eventually the music stops.

"Old houses are full of stories". And leaks and rot. Buying without inspections is a horrific risk.

Many people cannot afford a home, because some investors own dozens or even hundreds investment properties, and they receive tax incentives to own more investment properties. Our tax policies encourage people to speculate in the property market, that is the root cause of the issue. Investor should really pay more and more tax for each additional investment property they buy.

"Cant believe younger people arent angrier"... We are angry! What are we going to do though? String up our parents and molitov the parliament?...the young generation are just giving up because the carrot isnt even in view anymore. Pretty rich to seeing an LNP MP talking about price rises...considering his party took it upon themselves to lie to the older generations about negative gearing...

Governor Bligh said no-one should own more than 1 home. I would would be happy with keeping that at 2. This country has been mollycoddling house prices for a long time at the expense of everyday people. Homes and land should not be treated like the stock market.

My blood boils watching this. I am paying taxes to subsidise investors ! I am almost 40 with 2 kids and cannot afford a house.

The look of guilt on the faces of these realestate agents is telling, they are making stacks and even they know it is unethical.

In the US here. My dad's parents helped him buy his first house in his twenties in the early 70's. A little 900sq ft home for a single man. He met my mother and they stayed there for another 5 years after marrying before moving into their forever home of 2500sq ft in the 80's. That's generational wealth. He was griping to me about silly youths not buying houses nowadays, and i asked him why he didn't help me with an extra $100K to buy a starter home for myself in my twenties. He piped down because they were dealing with the 2008 crises and had to file bankruptcy and lost most of their savings. That's how generational wealth gets eliminated.

I've completely given up on housing. My folks migrated to Australia with absolutely nothing and were able to buy a property. Me on the other hand being Australian born, raised and educated, I still can't buy a house. And you know what Australia why would I? Why would I give up my life and nearly all my working income just to have brick and mortar when I can simply just leave your country and take the skills I've developed and just go to a completely different country with the 20% deposit that will probably cover 50% of a property in another country.

Easy solutions no one mentioned: 1) only citizens (individuals) can own residential property (meaning no REITs or other 'non-person' company structures can own residential property). 2) no individual can own more than 3 homes (primary, holiday & 'city flat'); this could be reduced to two homes if things don't improve significantly. If we agree, as a nation, that residential property exists for people to have homes, not as an investment vehicle, we will get where we need to go.

The only people winning are investors and agents. Anyone selling and moving hasnt gained as the cost of the property they are moving to will also have increased.

such a useless report. they spend the so much time reiterating the same point; "the market is expensive and inaccessible". we know that mate, thanks for clearing it up. why dont you really dive in and tell us why its like this. i.e. negative gearing, foreign investment, over commodification, historically low interest rates. why dont we implement a policy to stop some bloke living in dubai from buying 5 investment properties, pricing out every day aussies.

Negative gearing needs to STOP ! It old out of date political policy that’s killing Australians home ownership dreams

Kinda hoping for a better investigation. Every thing that was said in the 40 mins has been said for the last 10 years. I was hoping if your going to do a journalist piece on housing affordability in Australia why didn't you interview Philip Lowe of the Chairman of APRA.

60% of all properties in the inner city in Sydney and Melbourne are rental properties. That means they are owned by PROPERTY INVESTORS.

At 14:35 when he said "why aren't younger people mad about the system being rigged against them".... maybe we aren't so vocal because we've been told were ungrateful, spoiled, lazy and entitled children that just don't work hard enough? It's because we've been shamed for "not trying hard enough"

Gosh I feel this. I’ve been trying to buy a home in Brisbane (where I have lived my whole life) for the last 20 months. I’ve been completely pushed out of the market and I’ve lost out to boomer aged investors buying their second, third or fourth house every weekend. It is awful. Please someone so something about it.

I got the $21K first home buyers grant, helped for the deposit. The builder said the prices just went up $21K though in response. So not really helpful. My parents paid far less for so much more.

I studied in Hobart about 25 years ago. A guy on my course from Interstate bought 2 Inner City Terrace Houses sight unseen for $80 K each with the intention of renovating, live in one and rent out the other. As it has turned out it was a very smart move.

If we go to war why the hell would the younger generation fight for something they can’t afford to even own themselves!

Ban on foreign ownership of residential property. End negative gearing. Tighten regulation on lending... .. max 3 times income ... minimum 20% deposits for all but first time buyers

27:14 The part when he said of the house had kept up with inflation it would be worth $37,000 dollars today, that blew my mind wow at that price there wouldn't be any need for anyone to be homeless everyone could own their own home no matter what your job

No wonder Australian population is shrinking. If you can't afford a basic need, how can you afford to have children. The stress of chasing house price is the best Contraception.

I did everything right. Graduated, went to college. Got a real degree. Have a decent paying job, but a series of unfortunate events have led me to living in my Jeep, showering at the gym. How did this happen? 😳

1. The creation of housing market as investment rather than security. 2. Record low interest rates 3. Accumulated wealth dividing the haves from the have nots. 4. No one already in the property game really wants to see house prices fall, especially if you've just paid big bucks now. Which circles back to point 1...

This is not just an Australian problem. It seems to me that the same problems are displayed in many countries that have been enveloped by the American neo-liberal concept of financial capitalism. Banks have usurped their social licence and profit from the hardships of the many. It is time for people to say "Enough". Politicians need to grow a couple and lead us to a future that will benefit our children and if that means changing the fringe benefit rules and the capital gains concessions and regulating the shit out of the banks, then so be it. On the other hand, house prices are just numbers. The other side of this discussion is perhaps that government should support wage and salary increases commensurate with the increase in basics (food, shelter, clothing) and by increasing transparency by reflecting them properly in the CPI basket. After all, who the hell are they representing?

The older generation kinda screwed themselves over, they may have all the property but now they've got the kids staying at home till they are 50 in order to save a deposit, sucked in.

the thing is for a lot of young people, the price of houses and the value of a safe deposit has been going up faster than they can save money. its not being selfish recognising that for most of your adult life you have only been getting further away from getting a house and wanting to jump early, its not a good idea getting too much debt , but there no good options for the young adults in Australia currently

More community housing, less concessions for investors, caps on how many investment properties individuals and corporations can buy. A house must be a home and not a 'property'. Our economy is a sham shame on our government and all the profits =loss

“I’m surprised there isn’t more anger among younger people” … bro, we are mad as hell, we are just censored

I would say this is a western world issue. It’s happening in Ireland too where I live and Britain. People are moving back to costal towns and rural villages as in Oz and out pricing locals in lower paid jobs. It’s just terrible and disheartening.

I am still convinced that this madness will end in tears for all of us.

Sad there wasn't more focus on how the real estate agencies themselves reap so much benefit and only wish to fuel the fire.

Housing needs to be de-commodified. There are other avenues for investing your money that doesn't result in owning several properties. Japan had a housing affordability crisis in the 80s and it didn't end well

Surprised there isn't more anger from young people? Who would listen to them? Half of them are too young to understand how badly they will have it yet. Is the plan to end up like Japan, where mortgages are passed to children, for apartments? Completely Absurd. Who can offer a fix?

Time to put limits on how much one person can negative gear. There are even organizations who own hundreds of properties! The LNP don’t care.

AJOB means Just Over Broke. The notion of going to school, getting good grades, going to uni and getting a good job so you can save up and own your own home is an outdated way of thinking.

I felt the program was quite shallow - talking about the structural issues only a little at the end. The problem is the financialization of housing, treating housing as a investment for wealth generation and the tax incentives that investors get. FOMO is all together secondary.

All TOGETHER NOW!!!!! “ Old mate Snotty had a rort! Ee i ee i o! With a rort-rort here! And a rort-rort there! Here a rort, there a rort Everywhere a rort-rort! Old mate Snotty had a rort! Ee i ee i o!!!”

The keyword word here is the 'Howard Government' pricing first time homeowners out against people who are buying their fourth Time investment. PS I feel for the girl who is a nurse looking after her mum as well as the couple in Hobart who can't get in on the property ladder, Such shameful times we live in.

Oh trust me, there's plenty of anger on my part.

I'm a young person in Tasmania. Rental prices are through the roof, Hobart being one of the most unaffordable rental markets in the country. My generation is really shaping up to be one of life long renters, especially with mainland buyers constantly getting investment properties here and just renting it out on Airbnb. It sucks, and I hate it.

I don't get why every day Aussies have to subsidize a few negative gearing billions worth of property

"You need to be earning $100k per annum to even think of buying a house!" *me working in my min wage casual job* 🙊🙊🙊

Obviously, Australians are now living in a real estate bubble. The market will crash in the near future, as it did in the USA a few years ago when we were in a bubble too. When people stop buying in a frenzy, market will be flooded with houses for sale. The bubble will burst and many people will pay the price. Wait a few more months and see. Yesh Prabhu, Bushkill, Pennsylvania

I bought unit 250,000 the next day I change my mind I got lawyer get it back my deposit and 3 weeks later they sold 235 ,000 $ and 3 months later they sold 370,000 just couple months ago what is shit happening in Australia now??

we need a reform on policy and look to amsterdams. ban scummy investment property builders.

Corrupt politicians getting in bed with shady property developers.

I had to stop watching bcz they fail to acknowledge home auctions should be illegal. The auction is the spawn of the spike in home prices, due to desperation. didn't AUS learn anything from USA? The desperation and bad practices force the market up, creates a bubble, all the while privatizing land, a natural resource.

I get amazed looking at those auctions, couples in their early 30's paying 1.3 million? Fark me, where did I go wrong in life?

This is a scandalous situation and is a result of appalling government mismanagement throughout the last 3 decades!

when you have politicians and wealthy people complaining that newly thought of policies could force landlords to sell their excess properties and lower the price of home-ownership for everyone, thus allowing people to purchase their own homes rather than renting...you have a major problem. if the wealthy are complaining that people would be able to purchase their own home rather than renting there's an issue. renting should be significantly cheaper that home-ownership, yet it's not. at times it's even higher.

"I'm surprised there isn't more anger among younger people" We are angry, but what can we do?

We need hefty taxes on multiple home owners. If you own 2+ there should be an annual tax that disincentives pooling more money into housing assets. The sad reality is that all the money is being invested in property rather than innovative businesses. It doesn’t make us competitive internationally

When interest rates rise then things will get entertaining.

Curious as to what jobs people do that allow them to borrow $2m+ for these houses.

A similar thing happened in Japan in the 1980s - 90s. Prices of real estate went up because it was being pushed into the national economy externally. Then it stopped and loans were called in and the economy went bust. The government there had no idea this was happening. The end result was that Japan had to sell a lot of crashed cheap real estate after the crack to pay its excesses. To stop the increased prices is to stop the cheap external money. The prices are being driven up here by external banks - not local banks, foreign to Australia. They are funding what is happening.

It's monetary policy. The effect of monetary policy is assymetrical. We lower the interest rate to boost inflation and "smooth the business cycle" but if we raise them back up again it'll trigger a feedback loop that the government can't afford to fix as the housing market collapses. So what do we do? We raise it a tiny bit then drop it even further next time. Leverage grows, the cost of debt falls, investors leverage up more. Neoliberal monetary policy is dumb af.

Tasmania has 68 times the land area of Singapore. How the hell did we allow it to become so expensive?

It's very convenient for some people to blame this on overseas / foreign buyers or property investors, especially given that there are plenty of people already living in Australia who have multiple properties as part of their property portfolio. And then there is negative gearing AND low interest rates. The best thing our government can do is limit the number of properties that can be owned by a person or family to 2, so that these property investors either put their money on more expensive properties or invest somewhere else e.g. stocks.

Australian dream .. ? WTF ? Nightmare .

RBA and APRA are to blame for poor policies..

I think it's worth trying to set a law for limiting 3 properties to a person/family. I know it may not work.

Anyone who buys at these prices is anticipating high inflation. But if most people are maxxed out we should expect deflation. If Interest rates increase this current boom will evaporate in days.

It’s not a “shortage of stock”, it’s too much demand. There is no moral justification for anyone who owns a house in which to shelter their own family, to own a home that could be sheltering a family that does not - let alone to have the gall to charge the otherwise-homeless to shelter in that ill-gotten home. Protecting the community from the greed of the few is supposed to be the purpose of government, not promoting that greed. How residential real estate investors, and the real estate leeches who profit off it, sleep at night is beyond the understanding of anyone with the slightest social conscience.

Remove all the concessions for investors and watch the reality kick in. There's no reason you should be feeding the rich even more.

The real cause is the Reserve Bank of Australia , period ! By driving down interest rates to almost zero through money printing ( QE ) it has totally distorted real value of most assets . My kids generation has been thrown under the bus because central bankers took the easy option of just printing money to get themselves out of the GFC . Asset inflation is what the central bank should really be setting monetary policy against not the CPI .

Australia is not only the victim of house price, the entire world is… thanks to JP, US, EU and AU ourselves thinking that decreasing interest rate to zero is a quick fix of problem.

UK and US are set for interest rate rises… hold on, it’s coming and it’s going to be entertaining! Remain cash positive!

Owning a home is not free- ever. You will always have taxes which will rise, without fail. You also have to factor in maintenance (not upgrades, just maintenance) which will cost you on average, 1-5% of the total home value. a regular house, even paid off with no mortgage will still cost you quite a bit to own. Go ahead and buy something (keep it easily affordable). Just please get out of the mindset of "I won't have anything to worry about if I have a house." You definitely will.

I’m 25 and I’ve been renting by myself for 3 years and I’ve managed to save enough to buy a home and did so this year. Working 80hrs a week for years! It can be done if you want it enough

Living in Sydney - love it here but can't afford anything... had to look in other markets like Brisbane which are still going up at a ridiculous rate. Truly a massive problem for Australia.

This makes me sad. The first property I bought (in 2002) on my own, as a first home buyer & a retail worker. It was a basic 2 bedroom unit (no balcony or courtyard), but close to the city. Multiple people actually questioned why I'd buy a unit when I could rent a nicer & bigger house. Within 5 yrs my property & ones like it were being bought for 3-4 times the price I saw multiple people in my age group scramble to purchase a place. Some have never been able to. 20 yrs later it's even worse. There's been a few lulls & drops in the market over the last 10 years, where opportunities existed, but I fear for those who've bought at the top end of their budget and haven't wiggle room to cope with an increase in interest rates, illness, job loss or having children.

Look at how happy the real estate agents are, I think a lot of problems will come in the next few years as inflation hits and interest rates rise. Be careful what you wish for. Oh and while we are at it lets end negative gearing. Low interest rates have also compounded these problems as if interest rates were 8% people would just park their money in banks and not homes

The lucky country no more, impossible to buy a house in this crazy frenzy, the desperation and fomo of the buyers coupled with the insane greed of the sellers have created this insane boom. Ive been trying to buy in cairns for 2 years, houses have tripled in price, supply is low and demmand from cashed up Melbournians happy to pay anything has caused this insanity, it has to stop!

1 home to live and 1 home for investment and thats it. And stop other Countries citizens buying our houses. Lots of Countries in the World won't let foreigners purchase property.

This is the most useless report ive ever seen. It was just 45 minutes video footage of house auctions with the commentator telling us housing prices are rising. Learnt nothing.

In the UK we've helped with affordable housing by making 25% of housing in any new residential development to be affordable class. This still hasn't stopped housing prices rocketing in price but not at the level of Austraila. My first house that I bought in 1989 for £62k is in 2021 selling for £360k which is a 580% rise. Predictions until 2025 are a further 29% rise but 2021 house prices have outstripped their forcast of 8% and in Oct 2021 already stand at 9% so maybe around 13% for the year. Thankfully after a divorce and my first house given to my wife and family after 2000 I invested in housing rather than going full tilt on a pension for my future, I'm retired from work at 52.

They should talk about the rental crisis too. I know a couple that are leaving to India for a few years because they're going backwards working and paying rent. Imagine going on holidays for 2-3 years leaves you in a better financial situation than working and renting here!

What’s causing this is a desire not to miss out and historically low interest rates of around 2%. There’s going to be one almighty crash when interest rates go up. It will then be a buyers market when people can’t afford to service their loan.

Surely people understand what's going on.On our way to hyperinflation.

Same problem here in the UK. Housing out of London went completely bananas during the lockdowns.

Whats driving it? The global realization that no government seems to want to stop land and property being used as vessels of investment, so now property has just become the playthings of the rich instead of the original purpose of just being housing. Need to start limiting the amount of property an individual can own at any one time, and find a way to replace the current rental system that funnels cash from the poor and allows property hoarders to become leeches on the economy!

This era will be viewed in the future as a social and generational catastrophe . If a country is judged by how it looks after it's less privileged , the Australia is failing and on a grand scale . Only massive government infrastructure spending on attractive, affordable accomodation will dilute this curse .

Those at the top will never change the system as they have too much to loose, Feel so sorry for the younger generations.

I've given up... I'm a teacher like the woman here and the "contracts" make me want to burn the school down. I sit and nod with a smile on my face when they say "with the prospect of a permanent basis" but in my mind I'm punching them in the face. It's like a get-out-of-commitment-free card.

As a first home buyer in Melbourne. I knew I wasn’t going to afford to purchase a home in the suburb I wanted to settle in but I purchased an apartment which was the next best thing as per choice as a single wage low income earner. Very proud of myself of getting my foot into the door and settling into the suburb I wanted . I took advice from a mortgage broker who advised this how much you can borrow on your wage and stick to it. If you can’t find that house, consider an apartment or unit in the suburb you want, that’s what I did. Whoever is reading this good luck purchasing your home I’m sure you will find it .

“Just ferocious bidding at the moment…it’s crazy” - auctioneer. Mate…you’re part of the problem.

As a Single male in his Thirties, I don't see myself EVER owning ANY sort of Property in my lifetime at all. Not a House, Apartment, Flat, Studio, NOTHING. I'm permanently priced out of the market. House Prices are absolutely insane, and the thought of spending over a Million Dollars for a House is gut-wrenching. I would be much better off buying some Land, and getting a Tiny House on it instead. The only hope I have of owning any Property is if there is a dramatic, and wide-spread Crash of the Market where property values plummet to affordable levels. There needs to be a serious re-think on Housing not as an Investment, but as as House that someone can live in. Also, the possibility of un-occupied properties being heavily Taxed toward their owners unless someone occupies them. That way, someone is able to have a roof over their head.

The same thing is happening in America. It's all about corporate, and real estate greedy investors.

One of the things which annoys me: Who would have thought a pandemic would have caused real estate to do this? Not me that's for sure. How did a deadly virus become such a wealth creation event?