SA Economy

[Dog]

Lol

[claybro]

Reality check.
Our homes that are among the largest per SQM in the world, are paid for by some of the highest mortgages in the world.
These mortgages, which mortgage holders continually refinance, are used to finance our lifestyles, including car purchases.
On the subject of cars, we have on average one of the oldest car fleets in the developed world, so yes, car finance is not an issue here.
Savings...people save like crazy when they feel insecure, and all those redundancy payouts are in the bank.
Low unemployment? You do realise that someone who works 1 hour per week is not considered "officially" unemployed? And someone with a redundancy package cannot claim unemployment benefits, and is therefore also not counted?
Our deficit and debt in recent times WAS kept lower by world standards due to our government being awash with funds from previous surplus's, and mining profits and China. That cash cow has now come to an end.
Our deficit and debt is now increasing rapidly due to the demise of the mining boom and China slowdown.
Considering well over 50% of the population think that Rudd is a preferred prime minister to Abbott, I don't think it is Abbots talking down of the economy that has got everyone so depressed, it is the reality of daily life out here in the real economy.

[Nathan]

Reality check.
Our homes that are among the largest per SQM in the world, are paid for by some of the highest mortgages in the world.

I think this is a large problem. Disregarding the problems with low density sprawl that results from this, there seems to be some feeling of entitlement to the "Australian Dream™"

There was a story the other day about younger people not being able to afford housing. The fact is, many can afford housing — they just don't want what they can afford. They'd rather buy off a zero-deposit McMansion in some greenfield development, complete with massive backyard, 4 bedrooms and double carport then start at the bottom of the market in something much more modest - and then complain about the cost of living, which is entirely caused by their unnecessarily high mortgage.

My wage is decent, but certainly not what you call "high", and my wife works part time. We've still managed to save up and buy a good, sizeable apartment close to the city and have plenty left in the budget for niceties. And yet I constantly hear people who I know are earning more than us constantly moaning about the cost of living and how they never have money. The problem is people living beyond their means, not having the means.

[Aidan]

The economy is indeed weak. It would be much stronger if the government were spending more. Neither side seems to have much understanding of this, though the Libs have announced policies that would make the problem much worse.

If we accept your premise as correct, I would assume you don't actually believe that you understand this but that the entirety of the Labor and Liberal Parties combined don't understand it. Why, then, do you believe that both Parties are, according to your premise, acting in a manner that's not most beneficial to the health of the economy?

It's probably because the few people in the parties who do understand are unable to communicate it to the party leaders and those in the cabinet / shadow cabinet. Plus the politicians prefer to do what's popular than what's right - even when that popularity is based on a misunderstanding it's much easier to go with the flow rather than correct it.

[Aidan]

Now here is an interesting point. After nearly a decade of Federal Labor and over a decade of state Labor. I don't believe there is a single person I have spoken to who work in private enterprise, or who are self employed (ie the middle class) who feels better off, or even as secure as under the previous Liberal Federal government. Most Labor supporters would blame the GFC for that, and yet by Labors own promotion, their actions where supposed to have saved us from the GFC, and that we have had a mining and Chinese investment boom since the GFC. So what is it to be, either they successfully rode out the GFC or it failed. Either we have just had a boom, (which most of the middle class missed) or we are still in the GFC. Cant have it both ways guys, but something has gone wrong in both our state and federal economies since Labor took charge. Most wage earners in private enterprise are now worse off (less overtime, less part time hours, worse job security) most business owners are drowning in red tape, green tape, compliance requirements, increased fees, charges, taxes, and have just stopped investing and employing.

Rudd's actions (the first time round) saved us from the brunt of the GFC, but what the Federal government's done since then wasn't so good. They tried to rush back to surplus long before there was any need to. Worse still, they allowed a breathtakingly incompetent Reserve Bank board to wreck the economy by setting interest rates far too high, which in turn pushed the short term value of our dollar unsustainably high - and while Chinese demand saved the mining sector, it was difficult for firms in other sectors (particularly manufacturing) to compete, so the economy began to stagnate again.

I had hoped with Wayne Swan out of the way there would be a change in direction and the government would promise not to resort to false economies to bring us back to surplus. Alas they're still making the same mistakes, and if the Mad Monk's mob get in we're likely to keep making those mistakes on an even bigger scale.

The state situation is a bit different, but I'm too tired to explain it tonight.

[Dog]

Lol

[rev]

So what if we have the biggest average homes on average?

We are the richest in the world? Since when?
There's half a dozen countries whose median household income is higher.

or all the foreign tourists visiting Australia reading negative News Limited papers. They must think we are selfish ungrateful dicks.

Negative articles about local issues are not exclusive to Australia.

I think this is a large problem. Disregarding the problems with low density sprawl that results from this, there seems to be some feeling of entitlement to the "Australian Dream™"

So we should all pay $300k+ to live in a shoebox?

There was a story the other day about younger people not being able to afford housing. The fact is, many can afford housing — they just don't want what they can afford. They'd rather buy off a zero-deposit McMansion in some greenfield development, complete with massive backyard, 4 bedrooms and double carport then start at the bottom of the market in something much more modest - and then complain about the cost of living, which is entirely caused by their unnecessarily high mortgage.

Is your definition of a McMansion a 4 bedroom courtyard home with a double garage/carport?

The fact is that most young families can not afford to buy housing in the inner suburbs or established suburbs because housing that suits their needs(kids, etc) is too expensive. The fact is that they are forced to look to the outer suburbs to new developments such as out Munno Parra/Blakeview way. You can build a 4 bedroom home with a double garage out there, for under $300,000. That suits the needs of a young family, or young couple who are planning on having kids. Living in a shoebox does not suit their needs.

Fact..younger people are living at home longer then before because housing is too expensive.
It's not impossible to buy a house, but it is harder then before.

[Dog]

Lol

[Nathan]

So we should all pay $300k+ to live in a shoebox?

Is your definition of a McMansion a 4 bedroom courtyard home with a double garage/carport?

The fact is that most young families can not afford to buy housing in the inner suburbs or established suburbs because housing that suits their needs(kids, etc) is too expensive. The fact is that they are forced to look to the outer suburbs to new developments such as out Munno Parra/Blakeview way. You can build a 4 bedroom home with a double garage out there, for under $300,000. That suits the needs of a young family, or young couple who are planning on having kids. Living in a shoebox does not suit their needs.

Fact..younger people are living at home longer then before because housing is too expensive.
It's not impossible to buy a house, but it is harder then before.

Housing is too expensive if you want to leave home and step straight in to one of those 4 bedroom homes. Of course it is. But "young families" these days want to skip all the not-as-nice intermediate steps. When I was young, my parents moved through a number of smaller, beaten up homes, until they could build up equity and be able to afford something bigger.

I'm not suggesting they live in a studio apartment made for students, but the amount of space many people think they need is way off from what they actually need.

[rev]

So we should all pay $300k+ to live in a shoebox?

Is your definition of a McMansion a 4 bedroom courtyard home with a double garage/carport?

The fact is that most young families can not afford to buy housing in the inner suburbs or established suburbs because housing that suits their needs(kids, etc) is too expensive. The fact is that they are forced to look to the outer suburbs to new developments such as out Munno Parra/Blakeview way. You can build a 4 bedroom home with a double garage out there, for under $300,000. That suits the needs of a young family, or young couple who are planning on having kids. Living in a shoebox does not suit their needs.

Fact..younger people are living at home longer then before because housing is too expensive.
It's not impossible to buy a house, but it is harder then before.

Housing is too expensive if you want to leave home and step straight in to one of those 4 bedroom homes. Of course it is. But "young families" these days want to skip all the not-as-nice intermediate steps. When I was young, my parents moved through a number of smaller, beaten up homes, until they could build up equity and be able to afford something bigger.

I'm not suggesting they live in a studio apartment made for students, but the amount of space many people think they need is way off from what they actually need.

There's house and land packages for under $300,000 in the outer north.
Why shouldn't young families or couples buy up there?

People will buy what they can afford, where they can afford, what suits them.

Some of you choose to live in apartments. That suits your lifestyle and needs.
It doesn't suit everyone's.

Who are you to judge and dictate what other peoples requirements and needs are?

[claybro]

Im sorry Dog, but if you seriously believe your selective use of statistics prove that the Australian and indeed SA economy is doing well, you must live in a very small selective group. NO ONE I know, even Labor voters amongst them think the economy is travelling well. Not one person I know is in a better position than they were even 5 years ago. I'm sorry if you think too many of us believe Tony Abbott's ramblings about the sky falling in, but you give him too much credit..I don't think many people really take notice of too much he says. It seems Federal Labor are desperate to blame everyone but their own management, Rupert Murdoch being the latest person to blame for our negative sentiment. In the real economy, where most of us work, business is hurting big time, and laying off staff. It is nothing to do with negative sentiment, it is everything to do with woeful sales, massive cost increases, lower investment and economic activity. At least The government in this state Jay included has the dignity to tell it like it is, and not blame all and sundry for their problems. State Labor I would vote for tomorrow, as for Federal Labor, a more dishonest delusional bunch I have never seen.

[Nathan]

There's house and land packages for under $300,000 in the outer north.
Why shouldn't young families or couples buy up there?

People will buy what they can afford, where they can afford, what suits them.

Some of you choose to live in apartments. That suits your lifestyle and needs.
It doesn't suit everyone's.

Who are you to judge and dictate what other peoples requirements and needs are?

My point is that they buy what they can't afford, because their lifestyle & needs are beyond their means and they're unwilling to make any compromises. People can't max out their borrowing power and then complain about cost of living, as it's entirely of their own doing.

[Dog]

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[Aidan]

Reality check.
Our homes that are among the largest per SQM in the world, are paid for by some of the highest mortgages in the world.

I think this is a large problem. Disregarding the problems with low density sprawl that results from this, there seems to be some feeling of entitlement to the "Australian Dream[TRADE MARK SIGN]"

There was a story the other day about younger people not being able to afford housing. The fact is, many can afford housing — they just don't want what they can afford. They'd rather buy off a zero-deposit McMansion in some greenfield development, complete with massive backyard, 4 bedrooms and double carport then start at the bottom of the market in something much more modest - and then complain about the cost of living, which is entirely caused by their unnecessarily high mortgage.

House prices tend to go up much faster than inflation, and moving house is expensive, so it makes sense for people to buy the best house they can afford at a stretch rather than to buy something cheap and upgrade later. Until we phase out the residential exemption for land tax and abolish stamp duty, that's unlikely to change.

A policy of entitlement to the Great Australian Dream worked very well in the past. Originally the South Australian Housing Trust enabled people (not just low income earners) to rent-to-buy cheap houses. This reduced the cost of living - and with a lower cost of living, SA wage awards could be set lower than interstate wages, giving us a competitive advantage, while still maintaining a high living standard.

Alas those days are long gone. The SAHT lost that function before I got here, house prices have skyrocketted since, and wage rates depend far less on location. We've lost our old competitive advantage, and we're yet to gain an adequate new one.

And because of that, it's hardly surprising that we have the highest unemployment rate of any mainland state. To claim that this somehow disproves the effectiveness of government spending to revive the economy is laughable - there isn't much public infrastructure being built here by interstate standards, let alone enough to compensate for the cyclical slump in private sector construction demand, and we've seen the Federal government use interstate events as an excuse to cancel SA infrastructure spending. What does get built in SA is typically poor value for money, but that's a matter for another post.

[Dog]

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