Over the last twenty years or so, we have seen our dwelling prices increase something like threefold, while rents have risen by more than double.
Whilst property fortunes have fluctuated over that time, in general, it has been an upward and quite lucrative path – a property ladder, as many correctly described it.
What drove the property ladder during this time includes:
- Falling interest rates
- Increasing liquidity
- Financial deregulation
- Relaxed property taxation
- GST on new property
- Government handouts and assistance
- Strong population growth
- Baby boomer cohort
- Loosened foreign ownership laws
- Change from one to two income households
- A strong China and Aussie resource boom
- Strong wage growth
- Low unemployment
- Affordable housing
- High rental yields
- Hilmer and other government reforms
- Introduction of regional town plans
- Government surplus
It is a convincing list and it is little wonder that dwelling prices and rents rose so much over the last two decades.
Now, revisit the list and tick off those that no longer apply.
Better still, have a go at marking off those that you think will apply in two; five or even ten years’ time.
We will let you draw your own conclusions.