Increasing rent prices may break our pension system

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If Australia’s pension system is to maintain pace with rising mortage costs that prevent people from owning a home, then the Government may need to act now to redress the housing affordability crisis.

If Australians are trapped in our increasingly unaffordable rental market, future federal budgets will likely blow out.

Results from the 2016 Census reveal a sharp decrease in home ownership over the past 25 years. In 2016, houses being rented or owned with a mortgage made up 65 per cent of households, whereas in 1991, they made up 54 per cent of households.

While the generation heading into retirement enjoys a relatively high rate of home ownership, the current lack of affordable housing means future generations will be increasingly likely to rent rather than own.

This, in turn, means the Government will need to support a greater proportion of the population either with rent assistance or the Age Pension.

Pensioners who own their home are significantly better off than those who rent. In fact, the amount of money needed for a decent retirement almost doubles if a single person or couple do not own their home by the time they retire.

The number of people who rent a property rose to 30.9 per cent in 2016. Just 25 years ago, 26.9 per cent of Australians rented their home. Today, around one in 12 people aged 65 and over live in a rented property. If homeownership becomes more unaffordable, that figure, too, will rise.

Should this trend continue, Australia’s superannuation savings and the Age Pension system will struggle to meet the future cost of living.

Opinion: Addressing housing affordability would seem a good start

If the Government is hoping to reduce Australia’s future welfare bill, then addressing housing affordability would seem the most likely starting point.

Statistics from YourLifeChoices’ Retirement Affordability Index March 2017 show that around 29 per cent of singles on the Age Pension who rent devote almost 30 per cent of their income to rent.

The story for renting couples is not much better, with around 22 per cent of their income spent on housing.

So how do they make ends meet? By skimping on necessities such as food, health care and utilities.

You can imagine how much worse it will get in future, should the cost of owning or renting a house keep increasing.

The fact: if the Government doesn’t do something to reverse this decline of home ownership, either by investing in public housing, adjusting negative gearing and capital gains tax laws and taxing foreign housing market investors, the affordability crisis will deepen.

Already around 260,000 rent assistance payments are made annually to age pensioners. That figure will increase dramatically over the coming years. Add to that the increased cost of government-funded health care and aged care because older Australians can’t afford to maintain their health as they age, and you have all the makings of a welfare system blowout.

Yes, it’s a challenge for the Government. But if it is not looked at as an investment in Australia’s economic future, then our annual welfare expenditure will rise so fast and so quickly that a AAA credit rating will be the last thing the Government should worry about.

Do you think enough is being done to address housing affordability? What suggestion can you make to help fix this this situation?

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Written by Leon Della Bosca

Leon Della Bosca is a voracious reader who loves words. You'll often find him spending time in galleries, writing, designing, painting, drawing, or photographing and documenting street art. He has a publishing and graphic design background and loves movies and music, but then, who doesn’t?

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205 Comments

Total Comments: 205
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    One of the results of allowing a massive increase in immigration over the past ten years without providing the number of homes to accommodate them. Demand outstripping supply, house prices sky rocketing and rents rising accordingly. Even a room in a pub is now around $300 a week. You don’t have to be Einstein to work it out but politicians seem to have trouble with calculators.

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      It’s also the very high costs involved in accommodation. It costs around $120 a week to own a home outright and possibly more in all those strata title units in Sydney or Melbourne.

      A person with nothing but the OAP is doing it tough today. No doubt about it and may need to buddy up to afford accommodation.

      Rental assistance probably needs to increase but with careful screening to limit fraud.

      Costs really need addressing as you just can’t keep raising prices as wages and incomes stagnate.

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      inextratime……unless it’s calculating their OWN entitlements, pensions, salary, expense claims, etc

      Rae – $120 a week? – that is getting off lightly.

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      That is only rates, insurance and maintenance on a small home.

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      That certainly doesn’t include a mortgage which on a $350,000 house is about $500.00 + a fortnight

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      I don’t know where Leon found his figures, but a couple paying 22% of their income (the OAP) would be paying $312 f.
      ., and a single person $245 a f.
      .. !! My wife and I both on age pension are paying 47.1% of our income, and that is in Deception Bay 41km north of Brissie. Leon’s figures must be for someone renting out in the sticks somewhere, if at all possible.

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      I don’t know where Leon found his figures, but a couple paying 22% of their income (the OAP) would be paying $312 f.
      ., and a single person $245 a f.
      .. !! My wife and I both on age pension are paying 47.1% of our income, and that is in Deception Bay 41km north of Brissie. Leon’s figures must be for someone renting out in the sticks somewhere, if at all possible.

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      Totally agree inextratime. It’s economics 101 – the housing shortage is clearly a result of demand outstripping supply exacerbated by large scale immigration. That the Australian Government continually targets aged pensioners for budget savings is a disgrace. These are Australians who have contributed over a lifetime to the country’s economy. Their labour and taxes have made this an enviable place to live. On the other hand we have the social justice warriors in government who display no concern about the very generous financial support given to newly arrived (economic) refugees who have contributed nothing to the country’s well being.

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      I agree whole heartedly inextratime the horse has bolted and there is no easy answer other than to stop refugees and all immigrants that cannot contribute to the well being of Australia. I have sent lengthy emails to my local MP about how our infra structure is breaking down due to the gates being opened up for immigrants to enter Australia. There are parts of Melbourne and Sydney where it is now spot the Aussie and I have heard there are certain areas in Sydney where Aussies are not allowed to enter, what a load of croc. I live in the north of Melbourne and am appalled at the large number of Muslims that have moved into this area, I believe there are other pockets around Melbourne with the same problems. One good thing if you don’t own a house is that house prices are low, not good if you own your own home as prices have stagnated.

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    Been saying these things for years but governments don’t want to buy into it, until there’s a crisis.
    There should be more public housing for age pensioners because that better job is never going to come along.
    Obviously estate agents are not going to want age pensioners in high growth areas because the pensioners will have to leave if there is a big rent increase. That’s if they have enough money to start another lease and transport their belongings.
    Its not that people with jobs cant get themselves in the same amount of difficulty, its just that with age pensioners all of the other options are gone.

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    Way too many OAPs in house way too big for them. House needs to be added to asset test ASAP and any OAP received become a debt against their estate. This would allow lots of houses to come onto the market and help out with the shortage.

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      We are not in Russia. You cannot start dictating to people.
      Our home is not in the middle of a big city for a start.
      We are not wealthy people but we are frugal.
      Your comments often seem to be aimed at inciting negative responses.
      If you take away people’s incentives to own their own home then that is sad!
      Our children had homes but divorce cost three of them that security.
      People lose their homes or fail to achieve a home for a variety of reasons.

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      Well OG, when these OAPs sell their big houses where will they live?
      Downsizing to a smaller house? How does that increase the number of houses?

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      GrandmaKathleen we are not in the middle of a big city either, our house is our home and I am not moving out until forced to by death.
      OG is always talking through his hat and has little idea of saying anything except words to stir people up.
      Don’t try to reason with him it is impossible.

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      Also, OG, our home is used as a safety net for our children who return home when circumstances force them to, sometimes through unemployment and sometimes through family breakdown.
      The same goes for our grandchildren. Our home is available as needed.

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      Of course it will as all those vacant bedrooms will house people not rubbish as they do now.

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      Big saving on home help as people get older as they won’t need to have such big rambling houses cleaned at the taxpayer’s expense too.

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      OG needs to pull his head out and look at the real world, because what he sees and smelling ain’t roses.

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      So OG, is your house on the market? And do you have someone’s bedroom to move into?????

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      I’ve said this before, OG, and I’ll say it again if the pension benefit becomes a debt on the estate then, as Australia is a democracy, that should apply to everyone who has ever received any kind of benefit in their lives.
      You cannot, logically, choose a section of Australians and decide that they, and only they, will be responsible for the lowering of the national debt. If you truly believe that people should have their benefits added up and taken from their estate then it must be applicable to everyone, yourself included. A fairer way might be to bring back death duty but as we have so many mulitimillionaires in parliament that’s not going to happen.
      I still haven’t worked out your logic on how if a pensioner’s house was added to the assets test lots of houses would come onto the market, surely it would be exchanging one house for another.
      Our MPs have taken a huge amount of housing off the market owning well over 500 investment property between them. Why not have a go at them, after all they can only live in one house.

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      I have never been on welfare myself so there will be no debt on my estate.

      It is simply unfair to the taxpayer to subsidise people to live in big expensive houses by giving them welfare ie OAP and then allow them to just pass it all on to the next generation.

      Therefore the house should be in the assets test and any welfare OAP paid should be a debt on one’s estate. HECS debt is another that is being abused by retirees and should be a debt on one’s estate as well.

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      How on EARTH can your primary residence be classified as part of the Asset Test? I’ve downsized – and moved – as much as I can – single, 1 bedroom SMALL house that I worked my (single) butt off for. Downsize to what? – a tent out on the outback? Want some cash – do I sell off the lounge room? I am NOT wealthy – I do NOT live in a huge mansion, and I strongly object to ANY govt telling me that because I have been frugal, worked 3 jobs at a time, paid taxes, always supported MYSELF, never any welfare – I will now be punished because I have the temerity to actually OWN a home?
      Yet my bludger of a sister lives in a govt house, on welfare because she CHOSE to smoke all her life, goes on a cruise once a year with her friends… am now thinking SHE is the smart one!! SHE is not scrutinised and threatened… And have just found out Govt Housing is moving her from her 3BR house to a BRAND NEW 2BR unit, that is almost as big as her 3BR house was! God what fool I have been!

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      The house should be part of the assets test because it is the most unfair part of the welfare system. Is it fair you live in 1 bedroom house where another OAP lives in a 10 bedroom 6 bathroom house with ocean views?

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      “OAP lives in a 10 bedroom 6 bathroom house”. OG, try to be realistic.

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      Triss you cannot be seriously surely! OK strip the investment properties from the politicians then what? 500 properties back on the market round the country, sold in a single weekend. Meanwhile those currently renting those properties are out on the street. What are you going to do with them? Who are you going to strip of assets next?

      As for death duties, you want to tax the ‘wealthy’ to the hilt whilst they are alive and then take the rest once they die? Sure! That seems fair! NOT.

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      I think Old G, needs to go bag his head — he sounds like a person that is jealous of someone that has worked hard and owns their own home — how the hell does an old person up and move from where they have worked hard to be — PLUS the expense of moving he is obviously a nasty piece of work.

      He is maybe a dole bludger and wants more money for himself

      Not that everyone on the dole IS a bludger

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      TRISS, In SA we have probate which is similar to death duties.
      We don’t want separate Death Duties as well.

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      So the house can be demolished, the block be subsidised and the Govt. get rates and taxes for more blocks. If a block is divided into 2 they get double the income from them. It would be OK if they serviced the areas properly – more storm water drainage to prevent flooding, roads maintained to cater for extra wear&tear. Major roads are maintained by State Govts. who sometimes have to get grants from the Commonwealth Govt.

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      Grandma, Theo, Autumn et al, old mate OG is not advocating anybody being forced to move from their large family homes. The OAP safety net should be reserved for those who do not have the capital or resources to provide for themselves in retirement.

      Sure, inclusion of the family home in the assets test and recovering paid OAP from the estate are incentives to downsize to something appropriate to circumstances and using the released capital to fund retirement however this is a good thing. This reduces the burden on taxpayers to provide OAP to those who have means to provide for themselves rather than latch onto the safety net. The taxpayer should not be subsidising the retirement plans of those who have sufficient capital to provide for themselves.

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      As usual, total garbage from OG..You better get some glasses, read my post, how the he’ll can you compare someone with 1 BR and someone with 10 BR’s? Besides, WHERE are these large houses that pensioners are living in? Certainly not where I live!

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      Obviously then in2sunset you agree someone in a 1 bedroom house should not be treated same as someone in a 10 bedroom house but the reality is they are. Surely you can see a problem here.

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      OG, I think you are referring to massive homes. Modern houses of four bedrooms are not huge. Use one for an office and one for the main bedroom.
      The bedrooms are not big like they used to be either.
      I grew up in an old Queenslander, now that was big. Eventually it became two flats plus the family dwelling. A big enclosed verandah surrounded the house that would be the size of my place now.
      We have guests from interstate and as we live away from a big city it is a nice area to visit for family and find.
      Our family lives in three different states and we want them to be able to come home to us which is not our original family home,
      We bought this place nearly 11 years ago and it has doubled in value which is ridiculous.
      To downsize would save us nothing most likely because prices have gone through the roof. We could not even afford to move to Melbourne and that would only be into a unit which costs you heaps more with body corporate fees.
      It is cheaper for us to stay here.

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      Those big houses were designed for 3 generations to live in so that the elderly and young could be cared for with out the need for childcare or nursing homes. Today we just out the kids in childcare and oldies in nursing homes instead.

      Houses doubling in 11 years is not a very good return of less than 6.5% per year.

      However it is not fair that you should be treated the same as someone who lives in a bedsit but that’s the reality of it.

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      The house is not and never will be part of the assets test – go away, OG.

      People have rights in this country, and one of those rights is to live in the home they’ve bought and paid for, AND to enjoy the assets they’ve put aside over years of work and sacrifice, for their retirement.

      Abolish the assets test, pay everyone the pension, tighten up on all rorting of super etc retrospectively, and tax people on income and deemed income from arrangements of all kinds that are in reality fringe benefits. – at the going rate for income tax.

      That’ll catch all the rorters and hoarders who’ve had it good for too long and now seem to think they’ve earned the right to dictate to everyone else.

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      If you wish to include the home in assets testing – then all payments for that house must be taken into account in the final reckoning.

      Thank you for coming, but your harp is getting old and worn out, and frankly, we don’t give a damn, my dear, how many of your relatives rort by putting all their money into their home.

      Those are a minority – the rest get by on what they’ve got, so leave them alone.

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      OG, if the pension becomes a loan from one’s estate, then equally all the over-generous tax concessions to help the wealthy save for a cosy retirement must also be repaid from the estate, since these ridiculously excessive concessions are EXCLUSIVE to the well-to-do and cost far, far more than the OAP.

      The working class can’t give any more. They have nothing more to give. It’s time for the over-indulged selfish well-off to start paying their way – including corporations and those who use trusts etc. to dodge their obligations.

      Your continuing demands to ”take take take take take” from the strugglers will destroy our society completely – not to mention the economy, as there will be no incentive for anyone to bother working at all unless they are among the privileged.

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      Rainey tax concessions are not welfare at all. Anyone can use tax concessions not just the wealthy. Without tax concessions there would be a big shortage of rental properties and lack of business investment. Tax concessions help the poor more than the help the wealthy as they provide housing and jobs for them. The wealthy pay the majority of tax in this country whereas the poor take welfare instead of paying tax. Any family earning $60,000 or less get a lot more welfare back than they pay in tax. So you have to earn quite a bit before you contribute not take from our taxpayers. That explains who pays and who takes in our society.

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      OG, you are showing your extreme ignorance and arrogance here. Go and learn a little history – why the progressive tax system was created and how it fits in a capitalist society. It is an attempt to balance the gross and socially destructive unfairness of the rich exploiting the less advantaged by paying them a fraction of what their work produces. If workers were paid what their work produces, the capitalist system would fail because no entrepreneur could get rich paying other what they are worth. There would be no profit!

      The rich NEED public services in order for their activities to flourish. They have to have access to roads, shipping ports, rail lines, water, communications, power, police services, etc. etc. etc. They need social services to maintain a supply of willing workers. Without these things, the capitalist system would collapse. But you can’t expect the underpaid worker to pay for these things because the exploiting capitalist entrepreneur wouldn’t make profit if he had to pay the worker enough that the worker could afford to provide all these services. The progressive tax system was created to balance the inequity and ensure the provision of necessary services so that (a) the entrepreneur could continue to operate and profit and (b) the society could continue to function in adequate health to provide a continuing supply of willing workers.

      There are alternatives to the capitalist system, but nobody seems to think Australia should embrace any of them – except that the arrogant, greedy, self-serving ”ENTITLED” rich think the one essential component of the system that benefits the less advantaged – the progressive tax system – should be abolished and the poor should have to pay for EVERYTHING, while still working for half of what they produce.

      The rich TAKE TAKE TAKE TAKE TAKE and want more. Paying a minimal amount of tax – and avoiding their obligation as far as they are able – is NOTHING. They are TAKING labour. They are TAKING ingenuity. They are TAKING skill. They are TAKING public and social services that they pay a miserable token for – a tiny fraction of what they are worth. If that were not true, we would NOT have a deficit.

      And if it were true that the less advantaged were the takers in our society, they wouldn’t be less advantaged! They would be well off! Oh, but at this point the self-serving arrogant rich greedy pigs pat themselves on the back and tell themselves the disadvantaged are where they are because they aren’t smart or they are lazy or they are irresponsible. BS! The advantaged are either born to wealth and/or fortunate in terms of health and opportunity. Yes, some of them work hard and are smart – a small minority, actually! And yes, in our society it is possible for some of those born to disadvantage to work their way up in society and join the advantaged. But it WON’T BE POSSIBLE if the greedy rich continue their current campaign to destroy the progressive tax system, crush the middle class and upper working class, and wipe out all the incentives and rewards and support society has tried to provide to balance the inequity of the capitalist system.

      Pull your head in, OG. Lose your sense of entitlement. If you have money, you have USED people and resources to get it. Nobody gets it without, unless it’s inherited wealth in which case even more people and resources were used to get it (by the testator). NOBODY who is well-to-do in this society pays a fraction of what would be a fair cost for the resources and people they use to achieve material comfort. NOBODY! It isn’t possible in our currently structured capitalist society to become wealthy paying a fair price for everything you use to achieve profit.

      Sure, cancel the benefit of pensions by making them repayable from the estate. Punish people for buying homes if they don’t get rich before retirement. Take everything the strugglers have the chance to attain, and then wonder why they won’t work anymore, and the capitalist society collapses.

      Tax concessions are just as much welfare as pensions. They reduce the amount a person pays for the public services they use. Thus, they are WELFARE – because they allow access to benefit at less than it costs to provide that benefit. Anyone CANNOT use them. They are accessible ONLY to those who have a significant tax obligation. Yes, legal theory says anyone can access them, but clearly someone with a small tax obligation can’t pay a lawyer the equivalent of 10 years’ tax to reduce his tax by a few dollars a year! For the most part, the disadvantaged don’t even have access to knowledge of tax laws that allows reduction. That knowledge is expensive!

      Those who don’t earn enough to engage in tax reduction are paid pensions to balance social inequity, and those pensions are no more welfare than tax concessions or the right to use labour for less than it is worth.

      And tax concessions DO NOT BENEFIT THE POOR more than the wealthy, or we wouldn’t have a deficit that is increasing poverty! Government debt and calls to reduce welfare and thus increase poverty has increased in parallel with increases in tax concessions and avoidance, and in parallel with inequity and hoarded wealth. Thus, it is clear that tax avoidance and concessions hurts the disadvantaged and society as a whole. But of course the greedy ”I’m entitled” rich continue to excuse their greed and selfishness with every BS excuse under the sun, because these poor warped creatures actually believe they were born better, and they have a right to exploit, use and abuse to line their coffers with gold. They still believe in the master/slave relationship and they want to restore it. All we can hope for is that if they do, civil war restores social equity – and I hope that in that circumstance, you, OG, are the first to be shot.

      EVERYONE who wants to retain a healthy capitalist society should be screaming for tax concessions to be reduced and avoidance to be stamped out and for the healthy welfare systems of recent decades to be restored and continually improved. EVERY DECENT PERSON in this society should be screaming for a more equitable society in which everyone can share national wealth and in which an abundance of opportunity and strong incentives and rewards drive strong economic growth.

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      Rainey if you have a job you are benefiting from any tax concessions given to those who employ you. You are also dependant upon them making money otherwise you have no job. Our society depends on people taking chances to employ people and if they have no reason to take a chance then the economy suffers with the poor the hardest hit. So if it means so much to you being exploited then give up your job and let some one else have it that appreciates it.

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      OG, I agree with your comments up to a point. I’ve taken chances and employed people, so I see things from the employer’s viewpoint. But it’s about balance, and we’ve lost the balance. It’s skewed way too far in favour of the privileged.

      I work for myself, but I contract, and I greatly appreciate the opportunities my clients provide. I am keen to support my clients to do well, and I admire them rather than envy them. I certainly won’t give up my job because I love it, and it pays well enough that I don’t feel exploited. But my partner and I WERE exploited for 25 years, and like most workers, we felt we had no choice but to tolerate exploitation because we didn’t want to be ”bludgers” and we thought working might eventually open doors. Ultimately, we quit and went on unemployment benefits while we built a business for ourselves. We found we had to cheat the system to get out of the intolerable rut we found ourselves in, thanks to a flawed system.

      I want to see businesses operators succeed. But I want to see balance improved so that everyone has a fair chance to prosper according to their abilities and endeavours. I want to see welfare reformed to offer a ”hand up” rather than a ”hand out”, and to stop locking people into dependency.

      Punishing people and keeping them down won’t help our economy, and that’s the line you keep pushing. It’s the WRONG APPROACH. And anyone who has genuinely struggled understands why it’s the wrong approach. But sadly, the rich are just too selfish and greedy and refuse to recognize that just as we need people taking chances and employing others, we also need people who are strongly incentivized to work, despite being paid less than their contribution is really worth. And we need social benefits to compensate for the fact that workers are paid less than they contribute, so that the capitalist system can continue to function in good health. (Because the capitalist system depends on workers being paid less than they produce so the employer can profit!)

      Right now, the capitalist system is under threat. It’s not delivering prosperity. It’s resulting in major government debt. Every notable economist and world leader agrees the reason is excess inequity -the rich not paying their way. We need to fix that in order that the system can continue and those who take chances can continue to find willing and capable employees and the demands for welfare can reduce.

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    We have a sotuation here in Woolloongabba where there is significant redevelopment with multistory buildings. No one unit has been set aside for public housing but it would make sense that the government should buy some of these for public housing. Its cheaper for them to buy of spec than develop a whole complex. So our population over the next 10 years is going to sky rocket but no infrastructure has been put in place for any other services. You dont have to be a rocket scientist to see whats going to occur. We dont even have a library, we are just a few kms from the city yet the public transport around here is worse than in places like Cleveland and places further afield. We have limited green space and no public housing. Trouble is the council only looks at the money its brings them in, they dont look at the livability of a place, or the infrastructure this place will need once the population in this area more than trebles.

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      ditto on the Bellarine Peninsula where development is rampant despite the lack of infrasturctructure. it is obvious council only care about their precious revenue and precious little about the livability of the place.
      a right nightmare is happening here and nothing anyone can do to stop it.

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      Overcrowded rabbit warrens have sprung up all over and I imagine are very difficult for the elderly to live in as those culdesacs require long walks to navigate, inadequate public transport etc.

      I can’t imagine how a non car owner manages to live in them.

      The two storey macmansion will turn into a nightmare as time passes I expect.

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    If you haven’t got a house by the time you retire then it is either a case of circumstances or lifestyle. No point blaming the system in the many (not all!) cases where people have not wanted to put themselves out though. Apologies to the offended.
    There are all shades of grey but many people struggled hard to get into a house to help themselves. The thanks they get for not burdening taxpayers is governments coming after them.
    People who are doing it tough in retirement because they are forced to pay rent need to firstly blame themselves and seconding governments who squander our tax money and give to the rich rather than distributing the NATIONAL wealth in a fairer way. And then the mentally challenged vote Liberal??? No comment!
    Public housing? Great idea as long as a minimal and affordable rent is charged.

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      Have to agree with you, Mick. We had a very modest lifestyle as a young family (no holidays, fancy cars, dining out, a lot of make do and mend, etc) so that we could pay the mortgage (and let’s not forget the 18% interest rate in the mid-late 80’s). We did it tough in order to have the mortgage paid out by retirement. I get somewhat irritated by those who keep saying the baby boomers have had it easy when we mostly lived very economically!

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      We seem to have an unfortunate process lately. We looked at a large subdivision at the weekend and it seemed that as soon as the blocks went on sale they were grabbed by builders. Presumably they then put the price of the block up and if – a young family maybe- wanted to buy they were only allowed to build with the builder who owned the block. We checked the finished house prices by builders different from the owners of the blocks and found the same size and type of house would be around $50,000 plus cheaper. That’s something that needs urgent checks.

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      Many people buy blocks of land with very little money down so that the developer can get finance to do the subdivision. They then sell them at a profit when the subdivision is released. Banks will not finance subdivisions unless 25% of the blocks have been presold.

      If I wanted to buy a block of land I’d check Council records to see why has applied to subdivide land and then contact them to buy a block in their pre sale process.

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      Mick and Gammer you are both referring to historical Australia. Leon is future projecting and he is quite correct.
      The term of our loans were 14 years and it was very unwise with high interest rates to pay it back over a longer period of time.
      Today it is taking young workers nearly ten years to get a deposit significant enough to repay a massive loan over 40 years. So if they do get a loan at 30 it won’t be paid off until they are 70 years old – the age the pension (if there is a pension in 2050) will be available to them.
      So all those life requirements, such as children’s weddings, education etc will all be a significant burden if they are still repaying a home.
      It is the Government’s plan to make all individuals responsible for their own retirement funding. To do that, we have been told by the superfunds, that we need to put in much more than the current 9% – how will they be able to do that?
      I realise we have a dual income stream and for many this is not an issue however I think one of the nicest thing about Australians is that we were proud “not to leave anyone behind”. I would like to believe we will always be that way.

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      I struggled and worked hard to get into two – divorce and piss-poor management of this nation on all sides of ‘management’ put paid to that petty ambition to own my own home in retirement.

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      Sorry, Rosret, but I don’t get this whinge about the young having it so tough. With two incomes and minimal interest rates, it seems to me to be far easier now to buy a home than it was for most of my generation. Add to that, women’s wages and wages for under 21s when I was young were a tiny fraction of a full male wage, and most of us didn’t get to finish high school let alone go to university and get a high paid job. Appliances, furnishings, clothing, household goods and cars were all many times today’s cost, relative to wages, so we had much less to apply to the mortgage.

      Pay off a house in 14 years? In your dreams? I had to borrow privately to scrape up a deposit because house prices were rising so fast in the early 70s and rent was expensive.

      It’s still possible to buy a good house in country towns for $300-400K, and that’s very affordable for most young folk. Sure, it’s expensive in the cities. It always was. We could never have even contemplated buying in a major city until we were close to retirement and had built, bought and renovated, and sold – living very frugally in half-built houses while we worked to improve them – for 40 years.

      I don’t know a young person either where I live now or where we lived previously for 25 years who isn’t paying off at least one investment property PLUS a mortgage on a newish, four+ bed/3+bath/3+ living room brick and tile with landscaped gardens and double garage holding 2 newish SUVs. Many have swimming pools as well. And of course all top-notch appliances, furnishings and electronic equipment. And they go out to restaurants and clubs weekly and holiday abroad.

      I’m sure there are folk doing it tough in low paid jobs. There always were. Somehow people seem to compare apples with oranges – the well-off from our generation with the strugglers of today. Apples to apples – the young can buy houses far more easily than most of my generation could, if they just stopped the indulgences and reduced their outrageous expectations.

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      Gee Rainey you must live in an affluent area as way too many young people around here struggle to make ends meet each week. Back when I bought my first house in pay it off in six months. You would need a very good job today to be able to do that.

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      I do not live in an affluent area, OG. I’m sure some young people struggle. That was always the case. They don’t struggle any more than I did when I was young. Even the worst off are far better off than the strugglers were in past decades. Goodness, how many today can’t afford to go to high school. My grandmother had two years of schooling. My mother left after Year 6 and was scrubbing floors for a living at 14. My partner was working at age 9. Give it a break, OG. NOBODY today knows the definition of ”struggle” as it was for past generations (including mine!)

      As for paying a house off in six months – it was only possible in my day if you were very wealthy. And it’s just as possible for very privileged today – though with such low interest rates now, it’s probably not something many bother striving to do. We sure wanted to pay off those 18%+ loans in a hurry if we could, but most, like me, took 25 – 30 years or more, simply because they couldn’t earn enough to pay off any faster.

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    Addressing housing affordability is NOT ENOUGH !
    The government needs to address the constant rise in council rates as well, for if neglected, the rates may go up so high that owners on pensions will not be able to afford it either!
    Councils don’t seem to be considering the unstoppable every day costs of living in this country.
    But that’s probably part of the Agenda 21 and Agenda 30.
    DEPOPULATION !!

    However, Mr. Turnbull just recently didn’t hesitate to give himself a pay-rise of $17,000 !!!!!!!!!!!!!
    SCANDALOUS !!!!

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      Good points HKW

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      I may be wrong HKW but public housing has generally been a matter for state governments.It is almost impossible for a federal government to legislate for housing affordability. Sydney and Melbourne housing costs are on a boom, Brisbane is rising but slow, Adelaide is stagnant and Perth is dropping so to legislate federally would be very difficult.

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      Yes down on the beach here very ordinary houses are costing $11000 a year in rates. A pensioner with no other income couldn’t afford that.

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      Don’t OAPs get 50% off their rates which the rest of us have to pay extra to cover?

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      No, OG, they don’t. Not in my neck of the woods, anyway.

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      Well that’s what the legislation says.

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      Old geezer where I live you get 50% off your rates up to $250!!!! apparently rates were around 250 back in the day.
      $2000 to 3000 now in rural Victoria. So we get 150 discount. Of course it is better than nothing but the 50% discount that they rabbit on about is just creative accounting and misleading to say the least

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      HKW, I see you are on the ball and awake to the plans

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      OG, please give details of where it says that pensioners get 50% discount on rates and I’ll be able to take our council to court. They give us 15% which, according to the person who knows everything, is 35% less than the legislation says. If you can’t find the legislation maybe an apology will be in order. I’m not standing on one leg waiting.

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      Once again, totally wrong OG. For someone so smart, you are pretty unintelligant. They get 20% off, to a maximum of $200!! With my rates bill over $3200 for a 50 yo 1BR house, not near city, wow! Great saving!

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      I must admit I am worried about the increase in rates in line with the housing boom. Our council is so flush these days it wastes money on useless things – not infrastructure.

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      Gotta love the propensity for the keyboard warriors to voice their rage. Clearly pensioner discounts vary around the country so get over it. If it is an important issue for you then get into the ear of your local reps at each level of government to increase concessions. Some examples below.

      In Queensland, eligible pensioners can receive a subsidy of 20 per cent (up to a maximum amount of $200 each year) of the gross rates and charges levied by local council. Further rates remissions may be determined by Council. For example, Cairns Regional Council offers pensioners a rebate up to 40% of the General Rate to a maximum of $1,350.00 per annum.

      In WA, Pensioners and/or Seniors may be eligible to claim rebates up to a maximum 50% off current Rates and ESL (Emergency Services Levy), or defer payment and forgo the rebate, in accordance with the Rates and Charges (Rebates and Deferment) Act, 1992.

      For 2016-17 the Victorian Government-funded rebate provided under the Municipal
      Rates Concession Scheme was $218.30 or 50% of the rate payment, whichever is
      the less, plus an additional $50 rebate off their Fire Services Property Levy.

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      Councils are like state governments – they laze around and put any cash they’ve got into fripperies like various commissions etc, rather than into the infrastructure which they are charged to build and maintain. They then wait for the next higher level of government to come along and offer them more money… meantime the ‘executive’ of the council/state is sitting around accumulating bigger retirement packages and benefits and offering themselves bonus pay rises for their ‘good work’ – then they work out how to get the taxpaying public to foot the bill for their ineptitude and sloth – at the state level expect a renewed whine for raising the GST – at local level we are already getting three consecutive year’s rises of 5%, then 5% on that new base, then another 5% on that one – all of which are way above the cost of wages and inflation and so forth.

      Once again – we need to boot the lot and get a new lot in…

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    Another emerging issue is the lack of rental accommodation. This will increase as the government tightens the screws on investor borrowing. With reducing supply and increasing demand, landlords will rent to tenants with good paying jobs, not to people on the age pension. Not that age pensioners could afford to pay rents in the future anyway, even with the (low) rental assistance. That will mean increasing homelessness for age pensioners. All this is quite obvious, unless you have your head buried in the sand.

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      It is simply not economic to own houses today to rent as there are much better returns on one’s money elsewhere without all the negatives of being a landlord.

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    If our governments (both federal and state) are going to continue to bring in increasing numbers of extra migrants, that is over the normal number per year, then they must do something about finding housing for them and all the infrastructure that is needed to go with the housing – schools, hospitals, public transport, shopping centres and parklands with sporting facilities.
    Instead of all these people settling into the major cities they must also be encouraged to go into regional and rural areas. After all if they are living on welfare it doesn’t really matter where they live does it?

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    I thought at the time that encouraging older Australians to redraw equity from their homes for renovations, trips, vehicles etc was dangerous.

    Property is over valued no doubt about that. Rather than run around screaming the sky is falling perhaps the MSM could suggest a little patience.

    If you really can’t afford rent then get a flatmate or move to somewhere affordable.

    As the interest rate cycle corrects prices will come back.

    You can rent a two bedroom duplex here for $280 a week. For a pensioner that is a lot of their income but surely they thought about that at some point during the last 50 years.

    There are the disadvantaged yes. I believe we should have motel type small complexes with shared kitchen and relaxation and a caretaker couple. Surely that is doable in most regions for the desperate and homeless.

    And perhaps some sensible hospital system for the mentally ill and addicted.

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      Gee Rae, not sure where you live, but $280 a week would get a STudio apartment in the block of flats my daughter lives in(Oakliegh). SO a studio apartment is just 1 room with a bathroom. I looked at renting when my husband broke up with me, and about $400 a week would have got me the dumpiest place in Ashwood. Then if you drive around at the right time you see people “queueing” up to look at rental properties.
      I do like your idea of the Motel type of complexes though.

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      I could never afford property in Sydney leek.

      I did live in Newcastle for a while but 4 of us share housed together.

      Suddenly being on your own is terrifying. I was widowed at 34 with three little kids and I remember being scared to make decisions in case I got it wrong.

      You sound strong and capable. I wish you well.

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    Let me get this straight, about 8% of people over 65 are renters. We have not been told how many of these are receiving a pension of some description. If we assume that all of them are the about 29% of singles devote more than 30% of income into rent. That’s about 2.4% of pensioners who are single although it may also be the same percentage for married pensioners but there is insufficient data to confirm this.

    Again, I believe that we have a misleading article trying to baffle us with bullshit instead of dazzling us with brilliance. The numbers being thrown around may make someone who reads the article quickly think that there are a lot more people over 65 being talked about than there actually are. There are many and varied reasons why people rent from having a low paying job where purchase is not an option to divorce later in life when it is not possible to start again and whatever the reason, these people have my sympathy.

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