I'd suggest robotics used in the manufacturing stage of prefabricated builds, where you essentially build the structure offsite in a factory and transport to site, and assemble, would be the logical development stage. Sites have too many variables for construction. But, there might be some applications. Robots used to polish concrete floors perhaps. Or lay bricks.

3D printing has already occured onsite where you build the printer over the site and build/print concrete walls. This seems to me to be a special case by case application though.

Interesting area, and one ripe for improvement in the supply fabrication chain.

I also note the Government shared ownership rubbish like this

https://www.nsw.gov.au/housing-and-construction/home-buying-assistance/previous-programs/shared-equity

and federal more recently:

https://www.mortgagechoice.com.au/guides/home-ownership/help-to-buy-scheme/

Government policy seems to be to make housing affordable by increasing prices.

The gravy train will end at some point, but I'm just not sure how. It seems to me that we're fast hitting a point where inflation is becoming intolerable, yet we're far to indebted to actually raise rates. If we had real interest rate rises everyone would go broke, which I feel this is politically impossible. So... we just keep kicking the can down the road and inflate the debt away?

Who knows @Hackofalltrades ?

Interestingly, my uncle was telling me some time ago that real estate was a great investment in times of high interest rates. His logic was: you take on the biggest loan you can service and let inflation whittle that away, whilst wages keep increasing to keep up with inflation. Worked for him. The caveat being that wage inflation needs to at least match real inflation. But if you’re just starting out in your career, one can assume a pay rise or two . If you don’t get made redundant!

That was back in the days of 17% interest rates so it all happened in double time.

I’m at a loss to see how it ends happily or what might bring about that.

c

It will be interesting to see how banks will deal with 40 year loans if, they become the norm. Assuming, a retirement age of 65yrs and a full 40yrs required to service it, you will need to get a loan at 25yrs of age to eliminate the possibility that your financial lender may, request superannuation documents and an exit strategy.

At present, it isn’t uncommon for some Australians to be servicing loans in retirement but, these are clearly serviceable if the banks are happy to do so.

The question is what happens when the average house costs 1.5m and the 25yr old at 65yrs of age still has 500k outstanding?

As a consequence, I think we will begin to see family or generational loans whereby, a family will approach the bank with a guarantee and the loan will just be passed on down through a family.

To be honest I find it really weird that we have got ourselves into an asset/debt problem, and we are trying to find more innovative ways to further expand the debt to inflate the prices. Extending to 40 years might be a little extra sugar and win them some market share, but what happens next when we have our next wobble, or inflation spike?

@Strawman and Scott were spot on in their pod last Friday with the state of play and what happens from here. I bought a house in 2018 and I basically had to certify that I would be working until 67 for them to give me a 30 year loan. 40 year loan is just kicking the can further down the road and not fixing the real debt problem we have.

As to what would derail it?

Depending on what happens next with US, there is a good chance Australia (and potentially USA) could end up in some form of stagflation period where the cost of living crisis gets even worse as people have to servicing debt at the same or higher rates.

Or we can just wait until 2032 Summer Olympics time. Host nations tend to end up with significant financial issues either during or after the event has taken place.

This topic always pulls me in -- every single time!

40-year mortgages are madness. Not just because they’re questionable in themselves (though they are), but because they represent yet another distortion in a housing market that’s already broken. Like, self-evidently so.

The real problem isn’t about making repayments marginally more affordable -- it’s that these kinds of policies prevent the market from fixing itself. Housing affordability won’t improve until prices (in real terms) are allowed to correct. Period.

Instead, we keep layering on demand-side boosters -- excessive population growth, government handouts, relaxed lending policies -- without addressing the fundamental issue: a lack of quality housing supply.

We want housing to be more affordable, but we also want prices to keep rising faster than inflation? The only way that works is if wages grow even faster. And unless productivity rises faster still, this just gives you runaway inflation. That is, prices soar, but real purchasing power erodes. It’s fake growth.

I don’t wish harm on anyone who owns property -- I’m a landowner myself now! -- but the reality is that those who overpaid or overextended probably have to take some pain. That’s tragic, especially when you consider how many were lured into unsustainable strategies by misguided incentives. But someone has to take the medicine. Either the losses are borne by those who took the risks, or they’re socialized across society.

Honestly, if I thought it could be done in a fair and even manner, i'd probably choose the latter as the least worst outcome. But when losses are socialized, it’s rarely fair --bailouts almost always end up disproportionately punishing the poor. That's a pretty definitive lesson from history -- even in recent times, just look at which groups most benefitted from covid or GFC related fiscal and monetary programs. (not a conspiracy -- just an obvious outcome of the incentive structures for vested interests)

If we’re serious about addressing housing affordability, we need to let the market work. Focus on increasing housing supply, and stop artificially inflating demand. Ideally, we just see prices go sideways for an extended period, but I honestly think a healthy correction wouldn't be a terrible thing either.

We just have to stop pretending that we can have both cheap housing and ever-rising prices without paying a cost elsewhere.

Im waiting for the advent of intergenerational loans! when you die the kids take on the mortgage. lol, maybe i shoudn't be laughing too loud!

Politicians of both persuasions realise the risk in upsetting the housing wealth cycle (in the ballot box and to an overly concentrated economy), every time their is a crisis its a housing support scheme that comes out.

personally i think we need to tax principal residence gains, in the name of equity and spreading the tax burden, but every time i mention that to anyone, they have that lynching look in their eyes. lol

I’ll go out on that lonely limb too, @Solvetheriddle, and say we should bring in a broad-based land tax -- but I’d scrap income tax to keep the pitchforks at bay. Most people, including a solid chunk of homeowners, would actually come out ahead.

A land tax is fairer, simpler, impossible to avoid, and creates a more stable revenue base. It doesn’t penalise hard work or productivity and is inherently progressive -- those who own the most valuable land contribute the most (but are still incentivised and rewarded for creating value via productive use of the land). It’s a smarter, fairer way to fund public services without punishing effort or investment.

It wouldn't be hard to carve out some exceptions for pensioners and the like, so we wouldnt be throwing those that are cash poor under the bus.

While we're at it, I'd add a hefty resources rent tax too given Australia's (our) incredible endowment -- enough to allow for a decent ROI for investors, but that enabled us to capture a fairer share of the bounty.

Sadly, most tax policy is just twiddling at the edges. Not holding my breath for any bold reform..

Strawman I agree with this "If we’re serious about addressing housing affordability, we need to let the market work. Focus on increasing housing supply, and stop artificially inflating demand. Ideally, we just see prices go sideways for an extended period, but I honestly think a healthy correction wouldn't be a terrible thing either."

But I ask how on earth is this actually going to happen?

If the housing market drops 15%, what politician isn't going to do whatever it takes to fix it? Intervene on the reserve bank? Done. Flood the market with cheap money? Done. Increase immigration because affordable housing isn't an issue? Done. Throw grit in the process of creating new housing supply? You betcha. Create a "house price control board" to intervene directly into the market to buy public housing? Done.

Like, I get it has to end. But I don't see how it ends, except with massive inflation to correct the price issue. Either that or inflation gets so painful that it becomes LESS painful than house prices dropping 20%.

Also as an aside. Am I correct that as house prices get higher and higher, more and more money is created because that is how money is generally created? Ie., the 20% deposit and then the bank creates the rest of it? How is that not massively inflationary as well?

I'm seriously considering buying a house at the moment and the question seems to be does this bubble pop before my debt is inflated away.

You’ve nailed the root cause @Hackofalltrades

The bulk of new money is created through commercial bank lending. Essentially, banks lend money into existence, recording it as an asset (the loan) and a liability (the depositor’s funds) on their balance sheets. Borrowers promise to repay these loans with interest, often using residential property as collateral.

This creates a self-reinforcing cycle. As more money is lent for housing, property prices rise, which in turn encourages more lending.

When bank lending is put to productive use, its a good thing. But when most new money is funneled into unproductive uses -- like bidding up house prices instead of building new infrastructure or businesses -- you end up with more liquidity in the system but no corresponding increase in goods and services.

And I'm with Friedman in that "Inflation is always and everywhere a monetary phenomenon."

The point is that *excessive* lending for residential housing exacerbates affordability issues. Not only for houses but for everything.

The real risk emerges when borrowers can’t service their loans. Which is more likely when a substantial amount of property investment is not backed by much (if any) positive cash flow.

When defaults occur, money is effectively destroyed -- it vanishes from the system as loans are written off. This can lead to a deflationary spiral, which is often rapid and deeply destabilising. Governments are so averse to these busts (and for good reason) that they’ll do whatever it takes to prevent them, even if it means kicking the can down the road and worsening the root problem.

Predicting when and how this all unravels is anyone’s guess. It wouldn’t surprise me if things got even crazier before they settle.

But despite these concerns, we chose to buy earlier this year because we’re confident in our ability to service the loan. We’re not speculating on property values or planning to sell anytime soon. And if we ever move, it’ll likely be to a comparable property, so market fluctuations are less relevant to us.

For owner-occupiers, I think that’s the key consideration: Can you comfortably meet your repayments? If so, a lot of this stuff is less worrisome.

@Strawman , given you are on a roll would you also like to comment on the CBA PE?? Hahahaha.

On a serious note though, it is crazy what the banks will lend and how long for. We are refinancing, I am 57, good job but certainly not highly paid, and my new bank gave me a 25 year loan. All I had to say was that I would downsize when I retired. Really??? Do they plan for me to get an inheritance or just pull it out of super. Hoping to pay it off in 10 of course.

Meanwhile, down here in Victoria the government has promised to stimulate affordable housing growth and have 80k built per year for 10 years. They came out and said they got 72k done this year. Well, the 72k that were already in production when they made the announcement. The 50 something k that are approved for the next year will apparently turn out to be more like 40k according to the experts in property so I am guessing supply wont meet demand and prices wont be affordable......

Nessy

The next question of course is how does this unravel. How could this unravel?

The money in the system can't disappear, so it has to go elsewhere to other assets if it is to unravel. Is that actually likely?

How much of the inflation we are seeing now just normal assets balancing against property assets where the bulk of the wealth in society is?

I get what you're saying @Hackofalltrades -- but the money in the system can very much disappear. That's literally what happens when a loan is repaid...or defaulted on.

If it happens at a large scale, like during a financial crisis, this process can significantly contract the money supply, and result in a deflationary bust. The question is whether or not the RBA steps in and bails out the banks, and how they do it. (they will, and badly)

If eventually enough borrowers cant service their repayments, we'll find out. But knowing if and when is beyond me. Things always go on for much longer than you think possible. In the meantime, I just stay away from the silliness as best I can.

@Vandelay

Maybe take a look at small cap lender N1 Holdings (N1H)

It's one I'm researching at the moment but it has that "Compumedics" feel about management (CEO is also the Chairman)

Anyone looked at Helia? HLI

Provides mortgage insurance. Looks like it might catch the rate cut tailwind and the longer mortgage term. But don't quote me and I'm only throwing up another dumb idea.

This used to be called Genworth

Not looked at the stock in detail although do hold some of their Bonds (BBSW+5% maturing in 2030 so currently yielding around 9%p.a.) in the boring part of the portfolio (that helps my wife sleep at night and allows me to buy the type of things people talk about on Strawman).

If I recall they have quite a bit of concentration risk (i.e. a major bank like CBA re-tenders its contract and someone else wins it). That was back in July https://www.insurancenews.com.au/corporate/helia-s-largest-lmi-customer-seeks-new-terms

I think this was the latest note from the bond analysts:

Helia Third Quarter 2024 Trading Update

Last week, Helia (formerly known as Genworth), provided a trading update for the period to 30 September 2024. The company provided financial information for its key operating subsidiary which while not technically the entire group, provides an overview on the financial performance of Helia. The summary financial information is outlined in the illustration below.

Source: Helia Third Quarter 2024 Trading Update

The summary financials outlined yet another strong performance for Helia. The company reported a statutory net profit after tax for the third quarter of the 2024 financial year of $75.7m taking total profits for the year to date to $173.6m. A significant contributor to the result once again was the total incurred claims of -$15.0m with the negative amount a result of the company continuing to unwind excessively conservative reserving taken during the pandemic. The only negative from the result is the gross written premium was just $50.4m as the company struggles to write new insurance business in benign environment where the banks are generating fewer new loans that require mortgage insurance.

The capital position remains extremely strong with the prescribed capital amount (PCA) coverage ratio of 2.23x. This compares to just 1.81x for the prior corresponding period despite Helia continuing to return significant amounts of excess capital via a share buy-back and fully franked dividends. It is also noted that the company remains well above its targeted PCA coverage ratio of 1.40x-1.60x.

We remain comfortable with the credit of the Helia Group Subordinated Notes given the ongoing strong financial performance and capital position. The existing Subordinated Notes have a call date in mid-2025 and we would expect that Helia will look to refinance these Notes at, or prior, to that call date. We note that any new securities are likely to offer a margin considerably less than the 5.00% that was offered on the existing Notes which were issued at a time of high uncertainty during the pandemic.

You know what @thunderhead, you can only take so much of a face pounding before realising it's time to give up.

At this point, I'm thinking of liquidating everything and buying some off the plan units. Leveraged 5 to 1, of course, with the plan to generate negative cash flows ;)

Well played @thunderhead for the trigger and @Strawman for the clever response.

Is it not strange that the precedent of borrowing from bank of mum and dad (via cash or guarantor) is part of the reason why we are in this scenario where housing is so unaffordable?

I agree with Strawman and his regular rants on housing that the best thing to do for affordability is for the government to do NOTHING. Other than maybe put some more regulation around those companies heavily advertising on Social Media about fronting up housing deposits to allow purchasers have 20% deposit by only fronting up 2% of the cash.

Either way im sure we know where this will end up going....

Disc - currently purchasing a home and going through settlement so my views are contrary to my financial outcome

LOL. We have all been there with the face pounding bit…I am also a homeowner from a few years ago, buying well against my will in an overinflated market that has become even worse since.

Lucky those who even have a well coffered-up bank of Mum and Dad to call upon (I unfortunately am not one of them!). I guess they call that losing the demographic lottery!

Yeh its all a matter of timing these days and being in a position where you have a margin of safety. I did stumble across the Japanese house price charts after listening to an old Motley Fool podcast and its pretty bleak. Imagine buying your house in 1990 and its still not back up to what you paid after 25 years. I can appreciate its a different market and they have different GDP constraints, but i would hardly imagine negative gearing would be attractive to them.

Honestly i think not having the bank of Mum and Dad could be counted as a blessing, as it teaches you the value of money. I have a few family members who have that luxury and all it has taught them is that they can avoid financial responsibility as they know their parents will foot the bill.

It took me a while to come to terms with this exact sentiment...

Although, even if any reflation worked it still doesn't suggest a decent expected return at current prices. Pennies in front of a steam roller for those taking a speccy punt on property right now (ie.non-residential, non-cash flow producing, leveraged). But god only knows!

It really does stick in my craw though. Bottom line is that any Govt. assistance comes at a very real, albeit indirect, cost to society. And those that have profited most from it all avoid any major consequences. grrr

I live in Japan (Tokyo) and have been looking for a home to buy since 2018 (when my son was born). Unfortunately, still renting because the general trend for the consumer housing market is to buy new with the importance of living in a building up to code for earthquakes being at the forefront for most new home buyers. However, what disheartened me the most is that in most cases only the land retains its value (and if you are lucky, may go up if in an area of demand/development) and the house on top of it loses all of its value after 30 years. The construction industry has hit a sweet spot to build houses cheap enough to appeal to the consumer knowing full well that it'll have to be knocked down and rebuilt after a 30-year cycle. This is generally accepted by Japanese society, but I think most buyers don't understand the future wealth consequences of purchasing a very expensive good (the house), which is probably the most expensive purchase an average Japanese person will make, on a parcel of land. POINT: Most Japanese don't regard housing as an asset but rather an expensive good that must be rebuilt after 30 years.

Lest I came across as “old man cursing the Gods of luck”, I have very well come to terms with it.

But if I didn’t think it would be a whole lot easier to go about the business of living having that to call upon than not, I’d be lying :)

This is true @Strawman, but unless something extraordinary happens, the previous generations of homeowners have plucked all the low-hanging fruit leaving all the latecomers and their future progeny high and dry!

Thanks @DVV1974. I appreciate the different perspective from someone on the inside and how its treated as an asset. I would have never thought of housing as an asset that needs to be rebuilt every 30 years. The land does look like its having a slow uptrend when looking at the graph.

Its great to hear that they Japanese building industry has hit its sweet spot, and that society is accepting of how the market operates.

I come from South Australia, where homes typically last around 40-50 years before they get knocked over and split into multiple allotments/high rise towers. More about highest and best use here and not functional obsolescence on your side.

Such a great tweet Strawman. Its so true and ironic that the huge amounts of public money required to re-inflate the market be taking from the future generations whilst also making it harder to enter the market.

@Strawman @thunderhead - Do you think that AI implementation over the coming 20+ years will have downward impact on wages, and in-turn impact housing prices? I can appreciate that jobs will be about interpreting the AI outputs in the future, but wonder if the wage growth in line with inflation is sustainable in the future? Also poses the interesting question about whether people would consider lower wages in the future to avoid being replaced by a machine?

Anyways 30 years is a long time to be paying off a mortgage (especially when repayments are 50% of your household income) and a lot can change between now and then...

I’m somewhat conflicted by this issue. We have done better out of residential property than any other asset class. This is more by luck than design, I am by nature and profession an itinerant. as a consequence we have bought rather than rented in a number of different locations in Australasia. We are also extremely fortunate to both have careers that must list near the top of the tick list for banks to lend to. This has allowed us to access a degree of leverage that we would not have been able to get in any other asset class. I don’t think we ever imagined that housing would have performed as well as it has, and it was never our belief that this was the path to riches. More a forcing function to save rather than spend.

From a societal point of view I completely support the opinion that the situation we are in is not healthy.

It is now a bit of a dilemma to work out what to do with property of a significant capital value but producing a meagre return. The same capital value in reasonably yielding equities would be preferable heading into retirement.

On the one hand the rent produces an inflation proof return which is attractive, and selling would trigger significant capital gains taxes. On the other I can’t help feeling it’s the wrong asset class to be most exposed to looking forward.

Even in an inheritance setting we would be leaving a huge tax bill to our children.

I realise this is a good problem to have, but thought it valid to any discussion on this subject. There are no doubt others that would not consider themselves property speculators that were just fortunate to have been born at the right time (purely from an AU/NZ property POV!????

@SudMav - If the AI is indeed the revolution it is anticipated to be, or lives up to anything like its current hype, I would certainly expect the traditional jobs pool to shrink in aggregate, and the resulting automation and productivity benefits to pressure wages i.e. there will be losers in this structural shift, and possibly large numbers of losers - not all of them can be accommodated by the "new world" jobs AI will create or enable (that's the whole point, right?). That will inevitably pressure house prices - I can't see any other way it plays out really, assuming the first condition comes true.

Let’s not neglect consecutive government failures in terms of their social responsibility when it comes to public housing. The apathy in Australia to plan for this is laid bare in the information below.

In the 40 years between 1981 and 2021 the percentage of all Australian households living in social housing (i.e. state owned and managed public housing or community managed housing) has ranged from 4.9 per cent in 1981 to 3.8 per cent in 2021 (from 2021 ABS Census. With public housing rising from 228k to 351k whilst, house dwellings increasing from 4.7 to 9.3m. (Australian Housing and urban Research Institute)

Whilst, places like Hong Kong and Singapore who have some of the most expensive property in the world have balanced the price rises by providing ~30% public housing (HKG) (gov.hk) and ~70% public housing in Singapore (statistics.com).

Imagine if all those Federal and State Government handouts and benefits were directed towards building public housing, rather than stimulating this property price explosion.

I guess it might depend on the interpretation of providing a “public housing service”.

@Chagsy I completely understand your dilemma (although the start of your passage sounds like these houses have all been PPORs that you have hung onto after moving on rather than deliberately selected rental properties).

A couple of anecdotes (might help, might be worthless):

• We had to sell our PPOR in Albert Park in Victoria because we had structured it incorrectly. When we needed to move to Sydney for work and needed to purchase a new PPOR we wanted to extract the repayments towards our new PPOR and keep the Melbourne property as a rental. Not allowed to do that due to “purpose of loan” rule so had to sell. Good thing was no Cap Gain on sale of PPOR. I think we had capital appreciation similar to having an average Aussie Earner (at the time) living in the home so that was nice. Learning … buy PPOR with an offset loan and never pay it back unless you know its your forever house so you can pull the money out for other purposes later.
• I just sold a small 1BR apartment and copped full CGT as we originally purchased it with money that was stuck in my wife’s defunct operating business but our needs had changed. While the tax bill hurt, I looked at capital return after tax and it was still 4.6% per annum compounded which in a ZIRP time is OK (although nowhere near as good as they returns from the market over a similar time period). I did a lot of sums and low yields and pretty high operating costs just didn’t make it stack up. Sometimes it’s the right thing to rip the band-aid. At least if you are paying taxes it means you’ve made money.
• I was chatting to a fellow in the same apartment block who also recently sold. His plan was to use the Downsizer’s allowance and tip a bunch of the proceeds into his and his Wife’s super (+ use bring-forward non-concessional contributions) as well has have money for a few more max concessional contributions before he formally retires. Quite clearly he’s in a different financial position to me so had a bunch of extra levers but might be something worth investigating (i.e. asset class aside, can you get a bunch of the proceeds into a more tax effective vehicle moving forward … might at least make the one time CGT bill look less scary)
• We’ve set up a Family Trust to hold investments. It might mean that the kids aren’t burdened by a tax bill as you can do discretionary distributions and preserve the asset. Also protects what you’ve worked for (or been fortunate to gain from participating in our crazy property market) from unscrupulous current or future spouses of your kids. It’s also like leaving them with a golden goose which could be better than a one time “stimmie” such as paying their home deposit.
• Finally, my strategy if things go to shit is to be able to downsize / relocate from the PPOR (which is a CGT free event). We are fortunate that we are in Sydney’s Lower North Shore so plenty of crazy equity built up and lots of other nice places in Australia we could relocate to and have money left over. I’m not sure if there is a strategy in your situation where you could downsize by backtracking (presumably your current home has full PPOR CGT exemption and the other properties could re-qualify (or qualify for partial exemption) over time if you started using them again. https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/property-and-capital-gains-tax/your-main-residence---home/eligibility-for-main-residence-exemption#

Good luck with the decision … sounds like you’ve got a nice problem to have.

DISC: PPOR and some Investment Real Estate HELD IRL (but not in SM)

@Strawman you forgot to add that it was going to be in a mining boom town.

Thanks @NewbieHK for the interesting point and the great data. Shows that there are a number of societies out there that will keep trying to provide affordable housing.

I do have a bit of a counter-position to the commentary you added on building public housing. As a government, Australia (similar to US) loves announcing new projects, but never tend to account for maintenance spending. Over time, these maintenance budgets get squeezed by future governments (as maintenance is not sexy) to use for other vote winning projects. Its very expensive to design and develop new housing, and the ROI from a vote winning perspective is not great.

Australia to avoid increasing ongoing maintenance spending has gone down a path of providing incentives (cash or concessions) to get people on the fringes of public housing to get into the housing market. This removes the upfront and ongoing spending component for establishing new dwelling, while getting people addicted to ownership and hopefully providing future tax benefits when they upsize from their small home later in life. They also give zoning concessions for more dwellings, or provide other incentives to get cheap rentals on the market under schemes like NRAS.

Maybe we can fix the problem by relaxing some of the standards on NRAS, and finding a way to sexy it up by maybe calling government lease payments as ''Solution as a Service" for public housing.

@RhinoInvestor - Your disclosure comment made me laugh out loud. Well played. I am not hopeful that the PPOR discount will be around by the time that I want to retire :(

I agree though that having to pay tax means you have made money at some point in time, and sometimes you need to rip the bandaid off and accept the tax bill if you want to access the capital. I can say this as I will have to pay some tax in the future, as I sold some shares to help reduce the amount of loan I would need to borrow on the new house.

A couple of great points raised in your post @Chagsy and indeed, anyone that came in at the tail end of Baby Boomers or even later, was/is indeed lucky to access to good property gains as an investment. In fact, not only was I fortunate to be born in an era in Australia's economic upturn (and not during any of the world wars), I was just fortunate (lucky) to be born in Australia to hard working & caring parents.

I do however have a slightly different take on why I property and not shares by giving a little background to how I things were, way back when I was young (currently happily retired in my mid-60s).

Unusually for my time, I always remember both of my parents working, which was far from the norm in the 1960's and 1970's, but we had little and lived with our grandparents in a 2-bedroom Inner Brissie cottage (we; being a family of 6, i.e. Mum, Dad and my 3 x brothers) until I was in Grade 5 at school, at which time my parents purchased a small house in the very northern suburbs of Brisbane, miles from anything in those days.....but cheap and I'm assuming somehow affordable on the double wages. All of us were enrolled in the cheapest private school available where the second child was 50% of the first for school fees, the third 50% of the second and the fourth free!! There was always something to eat and somewhere to kick a footy and have fun, as well as a solid education. So once again, I was extremely fortunate to have parents that did literally everything to make our current and future lives as best as they could.

In my early 20's I headed to UK for an extended holiday as a tradie sparky, arriving in 1984. I had worked for the previous 2 years building a coal mine west of Mackay getting good LAHA (no FIFO back then unfortunately) and working hard to save $20K for my OS working holiday. Seriously that was a lot of money back then, but I was keen on staying OS as long as I could to trial different cultures and to see the world. I did some electrical maintenance work for Citibank in London, where we had 2 hours in the middle of the night for any shutdowns, so it didn't impact the rest of the world's data passing through our building!! Anyway, after a few more trips around Europe & Africa I found myself working for Reuters running data cabling to all of the big Stock Broking Houses in East London in preparation for the London Big Bang in 1986, when Brokers could then trade from screens in their offices instead of on the floor of the London SX.

Sorry, but this was a long-winded way of explaining my first exposure to shares and the share market. Nobody I knew had anything to do with the share market in those days and it was strictly for the elite end of town. I was able to purchase some shares when Margaret Thatcher started privatizing most of the monopoly government business around the same time (e.g. British Gas, etc), but it was small scale stuff from Issuer Sponsored IPO's only, I had no idea about how to engage a stockbroker or what that cost.

Fast forward to the late 80's when I started my own electrical business and eventually got into the property market in 1990 by going halves with a brother as interest rates were hovering around 17%. It was a struggle no doubt, but long hours, hard work and (like anything) a loit of luck meant the business went well and housing finally started to go up in value again and interest rates went downwards.

The reason for dabbling in property instead of shares at that time was pretty simple. Share investing was horrendously hard and brokers were horrendously expensive. I still didn't know anyone that was a share owner in the mid-90's and most people simply tried property if they could save enough for a deposit to meet with a bank manager that treated them as a second-class citizen, to be told you were too high a risk. In fact, term deposits were the norm amongst my cohort. I refused to go down this track to earn a bit of interest that was then taxed anyway, so started registering with some broking firms and did the cheapest thing possible and bought any IPO's that incurred no brokerage fees. In those days, a smallest trade could cost a couple of hundred dollars, so IPO's looked great. BTW, when I say share investing was hard, there was no internet to talk of until the late 90's, phone calls and faxes were expensive and company info was by Broker word-of-mouth, monthly newsletters via mail that were extremely biased in nature and the odd broker investment day where they simply sprouted whatever firm they made the most fees from.

My point @Chagsy is I don't think property was a lucky investment back then, it was virtually the only thing people knew they had access to. I remember reading somewhere in a financial newsletter in the early 2000's (when interest rates were ~4.5%) that you should not put your money in the bank, but instead, buy the bank. I followed that mantra for a long time (somewhat successfully) and learnt in those early days the benefits of franking credits. Anyway, investing in shares, etc has come a long way, as has property investments. At least most people have available information on a host of choices these days via the internet and fast devices. Something faxes and phones could never achieve.

In regard to views by the others in this forum, I'll simply say I entirely agree and align with @Strawman and others on politicians tampering with free markets, to the detriment of all. So, meddling with things such as first home buyer grants, etc. only have a poor impact on the market and increase prices exponentially. On the other hand, I have a couple of National Rental Affordability Scheme (NRAS) apartments that I have been renting for 25% discount to qualifying tenants, with the government offering some tax rebates in lieu. These agreements expire at the end of this year (at least in the buildings I'm in) and the Government is not extending this scheme at a time when houses and shelter are at a premium and people are camping in parks. Go figure!! At a time when there is very limited social housing and all both parties are doing is saying they will, build more homes (without more tradies or more infrastructure) in some ridiculous timeframe, surely simply rolling over any existing schemes that only offer small tax offsets is a no brainer!!

Yes, us Baby Boomers were really fortunate/lucky to be in the right place at the right time, but there were still no free rides way back then and a lot of my friends will be still paying of their one PPOR for some years yet. At least they have shelter for now, unlike many others these days.

Amazing to think how accessible stock ownership has become @lowway. Things have changed pretty rapidly in a relatively short space of time.

Enjoyed hearing about your investing journey too.

Ahh the lucky country for those with intergenerational wealth. The rest of Australia - oh well!

Where hard work gets you a peanut.

It seems that real estate agent is definitely working for the buyer. I guess that's good in some ways, but yeah, I share your cynicism and it seems to border on dodgy. Who knows, there might be a legitimate reason.

I feel for you @Seymourbutts, what an agonizingly opaque and one-sided process.

Grrrrr!