Get rid of one bit of government pandering.

[weemadando]

In my case it's a portion of our social demographic.

Tell me Australians. How sick are you of hearing the following buzzwords from the gov't.

Working Families (the new Rudd favourite)
Aussie Battlers (the old Howard chestnut)

For the love of god, every time I see this group mentioned (they're one and the same), they're referring to the same group of semi-literate lower-middle class fuck-heads who took a zero-deposit mortgage way off in suburbia that they couldn't afford to start with, are at least partly reliant on welfare, have been publicly wailing and gnashing teeth over rising interest rates because their home loans, car loans and personal loans have now blown the arse out of their already over-stretched and moronically planned (if they ever existed) budgets. And now they have the balls to cry foul over petrol prices, when they bought their McMansion in an estate so far from the city and their work and without ANY public transport and then got another loan to buy themselves a new fucking Holden Commodore and get the wife a new people mover.

Why the fuck is the government pandering so much to these complete fucking retards? They've made stupid, moronic decision after stupid, moronic decision and are now demanding that the rest of the country bail them out?

FUCK THEM.

[PeZook]

They should be bailed out. After that, move them out of suburbia into work camps, providing them with food, clothing and basic entertainment and have them work on public projects to pay off the money the government had to shell out to anull their ridiculous loans, minus any taxes they've already put into the system.

This should be done in the interest of preventing the creation of a disenfranchised crime-prone underclass, which would be the result of just leaving them alone.

[weemadando]

They should be bailed out. After that, move them out of suburbia into work camps, providing them with food, clothing and basic entertainment and have them work on public projects to pay off the money the government had to shell out to anull their ridiculous loans, minus any taxes they've already put into the system.

This should be done in the interest of preventing the creation of a disenfranchised crime-prone underclass, which would be the result of just leaving them alone.

Oh, I have no problem with that kind of scenario. But what will actually happen, is that their tax rates will be cut, welfare payments increased and special assistance given.

I'd love to see them enter into a period of indentured servitude of sorts until they repaid society.

Hell, that would be fantastic for big businesses that rip off the tax payers too.

[PeZook]

Oh, I have no problem with that kind of scenario. But what will actually happen, is that their tax rates will be cut, welfare payments increased and special assistance given.

I'd love to see them enter into a period of indentured servitude of sorts until they repaid society.

Hell, that would be fantastic for big businesses that rip off the tax payers too.

Some form similar to this is actually how consumer bankrupcy should work. After all, unless you want to make the loan system a complete joke, you have to help people pay off their loan rather than just doing it for them.

So either give them a program in which they can pay it all off via servitude, or help them with financial consulting, so that they can downsize and slowly creep out of financial trouble. Bailing someone out is the worst thing you can do - you need to outright tell him that yes, he will have to sell his huge house and two cars if he wants to actually have enough money to buy food to eat in his fities.

[Stuart Mackey]

You forgot to mention that they live on Struggle St.

[bobalot]

Most of these people having a whine about how "hard" they are doing it arn't real battlers.

I have seen real battlers, and they don't live in McMansions. These are middle class people have mishandled money and now want a government handout. The same people who have a whinge about dole bludgers and poor people on welfare.

Remember all the shrieking and whining when the government started to apply means testing to middle class welfare benefits? The very same means testing which is stringently applied to poor people?

[mr friendly guy]

There was a story in the West Australian about some "battlers" bitching about the latest interest rate rise. Yet strangely enough they have an investment property. If they can't afford to hold the investment property then sell it.

Also charities have reported "middle class" people using their free food and other services. If they can't afford it go to a cheaper home instead of bludging on services for those who are really needy.

These people have dug their own grave. Unfortunately they want the rest of the country to help dig them out.

[weemadando]

I hate the "poor us" shit.

I live in a rental that is close to being "above my comfort zone" in terms of rent. That is, that it's approaching 1/4 of my net income on housing (as opposed to roughly 1/7th which it was in Hobart, but hey, that's Melbourne and I am in a damn nice area). Which combined with everything else doesn't exactly put me in financial stress, but certainly makes me budget carefully.

My wife and I looked at buying a house. We aren't exactly on a bad income. Between us we get 100k a year. To buy ANYTHING right now was to commit to 40 years of debt at an absurd level (up to 1/2 of net income on mortgage). So do you know what we did? We didn't buy something we couldn't afford.

My car has just crapped out again. And now I'm looking at how I can arrange to get rid of it. I'm able to use public transport or walk to do everything. I'm not going to put out for a car loan just because.

My wife and I are going on our first holiday (aside from a single weekend interstate roughly once a year) since we have been together. We've bought bargain basement airfares, are travelling in the depth of the off-season and are going to be staying in the cheapest places and with friends. We're still going to have to get some money on "credit" for this, but it's not too bad, certainly well within our means.

Why the fuck do people find it so hard to live within their means? I'd say it's because my wife and I at various points in our lives prior to meeting and being together have been poor. As in 100% dependant on welfare poor. The kind of poor where you lie awake in bed at night wondering how you're going to avoid having the power turned off, pay the rent and still have money to get food.

But then I go: "Wait a minute? Surely these people have been through the same thing if they're on welfare?" But then I realise, that these are people who are offered a credit card and don't think about how they're going to repay it, but simply that they'll suddenly have $5000 to spend. Or take the mortgage and decide to do interest only repayments on it for the rest of their lives.

These people are in this hole because of their stupidity and inability to plan. And it's not like the government doesn't give people access to COMPLETELY FREE FINANCIAL ADVICE AND COUNSELLING FOR ALL. They have no one to blame but themselves and thus should try and dig themselves out of the hole of their own making before asking for my fucking help.

[bobalot]

weemadando,

The housing market will have to deflate sooner or later. This has already started in the UK and the US. It was a massive asset bubble fueled by stupidly designed tax regime which encouraged the whole thing. Get a bargain when this ponzi scheme crashes.

Relatively our bubble seems to be even bigger than the US and the UK, so the falls in areas maybe even larger. The only state I think where housing prices may go up is WA, because of the mining boom and all.

[J]

With regards to housing prices and mortgages, using the historical 20% downpayment, 36% debt to income ratio, any home that's worth over 3.5 times your annual family income is NOT affordable. This was a rule born from the Great Depression and proven through wars, recessions, and all kinds of other hard times, it's a good rule, and it works. In the last 15 years or so we've ignored the sacred rule and created a massive housing bubble which is now in the process of imploding.

I'm not a financial advisor or anything, but personally, I'd sit out and wait for while until the market implodes before buying.

[mr friendly guy]

Most good 4 x 2 homes in Western Australia are now $500 - 600 (hopefully it drops). Lets use 550 K as the middle of that. That means couples must be earning about 157 K (is that before or after tax).

Which makes it difficult for singles like myself to buy even though I earn over 100 K.

Question for J. Is the total home cost (before or after subtracting initial deposit) that figure that should be only 3.5 times your annual income?

[J]

Most good 4 x 2 homes in Western Australia are now $500 - 600 (hopefully it drops). Lets use 550 K as the middle of that. That means couples must be earning about 157 K (is that before or after tax).

Which makes it difficult for singles like myself to buy even though I earn over 100 K.

Before tax. And yes, housing prices have become quite unaffordable. In the Toronto area for instance, the median family income is around $76k while the median home price is $425k. Adjusting for inflation, housing prices have finally stopped rising this year.

Question for J. Is the total home cost (before or after subtracting initial deposit) that figure that should be only 3.5 times your annual income?

Total cost is the purchase price of the home, so that's before any downpayments or deposits. So assuming you make $100k, any home that costs more than $350k or so is too expensive. If interest rates are at or near historic lows and you can lock in a fixed mortgage, the price can be stretched a bit to maybe 4 times family income, but no more.

[weemadando]

I'm not a financial advisor or anything, but personally, I'd sit out and wait for while until the market implodes before buying.

That's our current plan. Wait for it to crash and then pick over the bones like a vulture and find something we like at a bargain basement price.

[mr friendly guy]

Thats my idea as well.

The thing is, prices at best are only forecast to drop 5% in WA for this year (even by the housing industry which traditionally talks up prices). Then its sort of expected to go at around 2% a year (ie less than inflation) for the next 3 years while the rest of the nation catches up in booming house prices. Of course these predictions are done by 2 different groups, and the housing industry generally remains up beat.

If its just a plateauing it should give me time to get a bigger deposit (plus I will be earning more then). What I really want is a crash. Not only is it more affordable, it will teach those who whiners who borrowed excessively, suffer mortgage stress and then use charities to help them survive and complain to the government.

[thejester]

Hasn't the housing market been on the verge of implosion for the better part of a decade?

[weemadando]

The argument goes back an forth.

On the one hand you have the people going: the credit crunch, massively inflated prices, unaffordability are all leading to the market HAVING to crash soon.

On the other you have the people going: unprecedented demand for residential property in the cities, a growing economy and a booming population mean that the market can only keep going.

I'm backing the first group.

[Korto]

I'm backing the second. Since I've already put my (well, mostly the bank's) money where my mouth is.

Going by J's guideline, too expensive, but it's in the heart of a small town, it's got a decent backyard, and if I have to, there's a bus that'll drop me off right at the door at work (there'll be no way to get back, but no worries, right?).
We'll have this sucker paid off in ten years (if it kills me), just when people are realising how expensive fuel is, and thinking what they really need is a place with a shopping centre opposite, a school only four doors up, and a park 1 minute's walk up the road.