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Housing (un)affordability in Australia - the case for going tiny.

Alexandria Joy - Thursday, February 22, 2018

Australia is growing and changing - economically, socially and environmentally . Census data highlights aspects of this transition and suggests key challenges to overcome and issues to address.

We are at a critical juncture – a time to debate about the nation's growth and future. A time to think smarter and act more decisively.

As a property investor for over 20 years in the low to mid range residential market I am saddened to see the continuing decline of housing affordability in our "lucky country.” Not only am I beginning to be squeezed out of purchasing houses for investment myself as affordability goes down and competition and prices go up, I am am also seeing an increase in tenant distress and lack of supply and availability of clean, affordable, decent housing at the lower end of the market.

This week I attended the Hunter Research Foundation Centre's Hunter Economic Breakfast focusing specificially on housing affordability (or un-affordability to be precise) where the picture painted was gloomy and heralded a need for a clear strategy and decisive action by both politicians, businesses and private investors if we are to turn around this downward trend.

At the breakfast, Greg Budworth from Compass Housing shared that:

·      In the decade after the Second World War, state and federal governments combined on the biggest building boom in Australian history. 

·      Over a 10 year period they built more than 670,000 houses, providing affordable homes for generations of Australians. 

"70 years later Australia is in the grip of a housing crisis that is undermining living standards and threatening future prosperity." Greg Budworth

Research backs this up. The 14th Annual Demographia International Housing Affordability Survey: 2018 Rating Middle-Income Housing Affordability covers 293 metropolitan housing markets in nine countries including Australia, Canada, China, Ireland, Japan, New Zealand, Singapore, the United Kingdom and the United States. Findings from the research include that there are 28 severely unaffordable major housing markets, including 13 in the United States, 5 in Australia and one in New Zealand and China.

Virtually all the severely unaffordable major housing markets covered in the Survey have restrictive land use regulation, usually urban containment policy. Urban containment seeks to severely limit or prohibit new housing development on and beyond the urban fringe. A typical strategy is to impose an "urban growth boundary" which is associated with higher land prices for land on which development is allowed. This leads to higher house prices, a lower standard of living and increased poverty. Housing affordability is likely to worsen even more unless there is regulatory reform that restores competitive land markets on the urban fringe.

In her impressive book, The Life and Death of Great American Cities, Jane Jacobs said "...a metropolitan economy, if it is working well, is constantly transforming many poor people into middle-class people..." Yet, urban containment policy has been associated with more expensive housing, which has lowered the standard of living, increased poverty and stunted economic growth.

Historically, the Median Multiple has been remarkably similar among six surveyed nations, with median house prices from 2.0 to 3.0 times median household incomes (Australia, Canada, Ireland, New Zealand, the United Kingdom and the United States). Housing affordability remained generally within this range until the late 1980s or late 1990s in each of these nations (Figure 2).15 In recent decades, house prices have escalated far above household incomes in many parts of the world. In some metropolitan markets house prices have doubled, tripled or even quadrupled relative to household income.

Sydney is again Australia’s least affordable market, with a Median Multiple of 12.9, and ranks second worst overall, trailing Hong Kong. Melbourne has a Median Multiple of 9.9 and is the fifth least affordable major housing market internationally.

But what does this all mean for us living day to day down under?

It means despite living in the wide brown land that we are experiencing increased mortgage stress, tenant distress and urban containment restricting urban sprawl pushing house and rent prices up and up. Basically demand will continue to exceed supply and if this is not reversed or slowed, worsened housing affordability is likely.

Unless we beat the urban containment restrictions by reversing our increasingly larger and larger homes and instead begin going tiny and mobile.

Imagine a house with no fixed address and the ability to live debt-free, with utility bills as low as $10 a month. It’s not just a dream it’s a reality in many countries around the world and it’s a movement about to become the new alternative to decades of mortgage repayments here in Australia as well.

As a property investor, opulent minimalist and futurist I thought I would put the trend to the test and build and live in a tiny house myself as a form of an experiment and to get a feel for it’s validity as an option for tackling housing unaffordability here in Oz.

Why go tiny?

·      freedom from debt

·      moveable location and travel

·      minimal environmental impact

·      the opportunity to live simply and consume less.

For me it’s not about cramming my old life into a smaller space. It’s become a quest for life, expansion and freedom and been more about redesigning my life based around my values and a vision.

My experiment – initially for around 6-12 months, is rethinking living and trialling a way for people to see a new way to consume less as well as ponder how we as humans relate to the rest of the planet as many indigenous cultures have done for centuries before us.

“Tiny living opens up a way for me to radically rethink the way I live, the way I consume, the way I work, and ultimately how our I relate to the land and mother nature." Heidi Alexandra Joy

I can’t wait to explore this wide brown land on wheels, house in tow. Follow my journey at The_Joy_Box on Instagram and Facebook.

My hope upon returning is that I will have a case for this becoming a business or social enterprise opportunity to help mum and dad home owners buy an investment that will earn an income and in doing so provide affordable housing for someone in need and pay off their own motgage sooner. A win win as it should lessen tennant and mortagage distress.

Source http://www.demographia.com/dhi.pdf

Three secrets to sticking to your new year goals

Alexandria Joy - Sunday, January 17, 2016

What kind of life do you want to live in 2016? 

Have you set a goal? An intention? Or chosen a keyword to guide you?

The concept of setting New Year's Resolutions is not that new. In fact it has been around since the Babylonians pledged to return borrowed objects and repay their debts at the start of each year, and the Romans started each new year by making a vow to the god Janus.

Each year for the past 12 years I have written a gratitude letter that maps out all the things I'd like to have happen each year. Each year I get better at sticking to those plans and manifesting many of the things I desire to have happen. 

Most people however say that their resolutions only last about 7 days, so why is it that sticking to something that matters to you so hard to achieve?

What is it that separates the resolute minority who stick to them from the majority of fallen masses? 

Is it that you've set yourself unrealistic goals - maybe you're a size 16 and you've set a goal to be a size six in 3 months, can you really make that happen? Your goals need to be achievable in the time given. 

Is it just a matter of willpower or are other magical, mystical powers at work? 

Or could just be that you're not working with your own psychology and are setting yourself up for failure from the beginning?

Perhaps it's a combination of all of the above. Here's three ways to work with your mindset and stick to your new year goals.

1 - Who you are being is more important than doing. 
Achieving your goals begins with who you are being. Unfortunately most people start the process with want they want to have, then what they have to do to get it, when really they should begin with who they are being. And while strategy (what you will do) and results (what you will have) are of value, you'll get no where without the right Mindset (who you are being).

2 - What you think about you bring about


Of the 60,000 thoughts we have each day researchers have found that 80 percent of the thoughts were the same thoughts we had yesterday so if you want to achieve new goals and become someone new you have to become aware of the thoughts you are having. In particular you can become aware of the thoughts you have about yourself. What is your internal dialogue saying to you?  How many times during the day do you beat yourself up?  We tend to think this random chatter in our head is just that, random.  We also pass it off as insignificant, however each time you bash yourself internally it creates an emotion within you.  Thoughts have energy.  Scientists can measure a thought. It has weight. It has vibration and it has an electrical current.  As does emotion.  So, when your mind feeds your spirit these negative thoughts it ignites emotions, whether it be sadness, despair, fear, or even joy, it creates an energy. This vibration also radiates outward and creates your experience with others.

The best way to combat the negative dialogue is with positive affirmations.  Affirmations are one to the most effective tools in your self care arsenal. This is the daily affirmation I have on my mirror at home "I am loveable, valuable and unique." - you are welcome to borrow it or make your own!


3 - Whatever is familiar becomes your success thermostat's set point.
If you’ve read any of the work of Sonja Lyubomirsky, you already know about the “Happiness Set Point” but, if you haven’t, take note. About 40 per cent of anyone’s happiness is governed by the “happiness set point” which involves intentional activity—what we do for ourselves. The real problem is that most of us aren’t focusing on either the right things or approaches that might make us happier. So as you set your new year's goals this year consider where your success thermostat is for each goal. If you're not conscious, your thermostat will naturally return to it's former set point. So if you want to achieve more you have to raise the temperature on your thermostat and then make that feel familiar, it needs to become your new and permanent set point, doing so will help your new formed habits stick and help you achieve more. 

What one thing will you do differently this year to make your new year's goals a success? Share your thoughts in the comments below, I'd love to know. 

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