Australia: Where the good life comes at a price

redwing

redwing

A piece from the BBC

Australia has managed to come out of the global financial crisis without a recession. But as a result of its booming economy, the cost of living is extremely high.

It was the limes that finally tipped me over the edge.

In the sleepy Australian seaside village where my parents live, not that far away from several citrus orchards, I was in a supermarket staring at a sign:

Limes: $2.25.

Two Australian dollars, twenty-five cents.

That's £1.50 (US$2.30). Not for a bag. Not for a pair. Each. One lime cost £1.50. Infuriated, I stormed out of the shop, limeless.

"The country has lost it," I fumed to my mum and dad over dinner that night. "How can anyone afford to eat in this country?"

"Darling," my father replied. "Look around. People here are rolling in money. We live in an unbelievably wealthy nation."

And he is right. In the 12 years since I last called Australia home, it has changed. It was always the lucky country, blessed with fertile land, abundant sunshine and plentiful natural resources.

Now, we are more than lucky. We are rich. Bloody rich. So rich that no-one blinks an eye at paying as much for a lime as some of our neighbours in Asia earn in a day.

Ten years ago, not one single Australian city was in the top 50 most expensive cities in the world to live in, now three are in the top 15

And you can feel it, just by looking at the small stuff.

For example, there is no litter on the streets. Nowhere. And I am yet to see a central reservation where the grass is not well-tended and the attractive shrubs not perfectly pruned.

It is the cars. I swear there is none on the road that is older than eight years. They are clean and dent-free and meet strict safety standards.
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Continues..

No Litter, Perfect Reserves & Parks, All vehicles under 8 years old...?

They mustn't have ventured out very far
 
You've got to remember that the author comes from the UK.. We lived over in Manchester last year and travelled extensively while we were there. Some things are very different over there.

I was often shocked at just how "dirty" things were. Walking up your average surburban st, you'd have to dodge and weave your way through the broken glass, discarded food scraps and other random assortment of litter/dog faces etc. Parks and playgrounds weren't too much better. I travel a fair bit for work (through QLD only though) and don't think I've seen a green space that could even be considered an eyesore.

Yes, food was relatively cheaper in the UK - but the quality wasn't as good as we get here (IMO). I am comparing fruit/veges from Sainsburys to my local Woolies here in Brissie. Most of the UK stuff I noticed, came from Spain or further afield, looked as if it has been snap frozen and tasted like it too.

As for our vehicles - yes, you see the odd clunker cruising around; and being under 8 years old might be an overstatement (she has to sell papers and make the Poms feel bad), but all in all, the roadworthyness of our vehicles here isn't really that shocking.

I read the rest of the article about the mining boom, bogans etc. The author could possibly be on the right track there - but as always, you can't tar everyone in that category with the same brush. They are my roots after all - only now, as well as hoarding motorbikes, cars and jetskis - I collect properties too!
 
I last lived in the UK in 08. When the exchange rate was in favour of the UK. I think it was 33c bought one pound.

The tables have reversed, that's all. It is why simply looking at exchange rates is a pointless measure of calculating value. I had the same discussion on a car forum. Take a VW Golf R. In Australia you can get one for 55k, or 36,000GBP. You can get one in the UK for 30,000GBP. So Australia is overpriced.

But, then you look at it against average wage. In the UK it is 26,500GBP. About 4,000 less than the purchase price. In Australia the average wage is $75,500 for a full time worker, 20k above the purchase price.

Wages, and the purchasing power that comes with them, is a much better way of working out how expensive it is to live and work in a place, rather than just fixating on how much "more" something costs.
 
I think the good times have come to a sudden stop anyway. The cupboards are bare, the rest of the world is in recovery and we are stalling.

IRs will necessarily be slashed, the dollar will drop, living standards will then plummet.
 
As a matter of interest, is there some form of index that compares countries in relation to all these things that goes towards affordability?

I've heard of the BigMac Index, but is there something that encapsulates the broad cost of living and wages as a true cost of living index.

I might have seen it already but can't remember ever seeing it.
 
Ausprop said:
I think the good times have come to a sudden stop anyway. The cupboards are bare, the rest of the world is in recovery and we are stalling.

IRs will necessarily be slashed, the dollar will drop, living standards will then plummet.
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For anyone worried about their 'empty cupboards' :

We visited Rob's mum in Melbourne for a couple of days before we returned to Canada for the summer :)
She's 69, and I asked her how much she spends a week, on average,for groceries. She said she gets everything for $50, and this includes any purchases she makes at any other store.

She took us to her favorite grocery stores. At this store (veggie/fruit/,meat store in Sunshine Plaza) there were lots of cheap prices.
Then we went to an Asian store, where they had bags of chicken carcasses, which still had lots of meat attached. They were $1-2 a bag!!
For anything else she goes to Aldi.

While in Woolies,they had P.A. announcement to a fill a veggie/fruit bag for $3. We could have put much more in it, but we had limited space. If we had purchased this perfectly fine food at retail cost, it would have been easily $15-$20.

So, if things get tight, it's good to know deals are out there.:)

Edit: Chicken carcass for making delicious homemade chicken soup
 
HotRod said:
As a matter of interest, is there some form of index that compares countries in relation to all these things that goes towards affordability?

I've heard of the BigMac Index, but is there something that encapsulates the broad cost of living and wages as a true cost of living index.

I might have seen it already but can't remember ever seeing it.
Click to expand...

Yes - in fact they only just did another one of these things.

It's posted on here - http://cbs.db.com/new/pdf/Random_Walk_Mapping_Prices_2013.pdf

Give me the high prices and ultra high quality of life rather that reasonable prices and low quality of life.
 
0.35c each at woolworths
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Yeah, that might be now. But some time ago they were very expensive even for Perth standards.......

I distinctly remember Mrs Nor being asked by Number 1 son to pick some up for him the next time she went shopping........

She returned home with one lime.....

When challenged by Number 1 son as to why she didnt get more, she did comment as to how expensive they were........(over $20 / Kg apparently)

To which he replied. "Why didnt you just put them through the selfcheckout as lemons?"....:eek:

This apparently was all the rage at the time.....particularly with fruit and veg. Somewhere in a Woollies far far away there is a Fruit & Veg Manager crying into his stocktake.....:)

Ciao

Nor
 
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Pretty sure its not the fruit that is expensive. Its all the labour costs associated with handling the fruit all the way to your table.
 
NHG,

Yep labour does cost, however in this market we in Australia will never compete against production labour costs at less than 20% of our own.

In addition I'd add in:

a) Market manipulation
b) Corporate greed
c) Complete lack of industry protection
d) And a healthy dose of high E-Coli.....:(

Very shortly in Victoria, it is estimated that 750,000 healthy fruit trees will be pulled up and burnt.......so smart.

ciao

Nor
 
Icarus said:
I was often shocked at just how "dirty" things were. Walking up your average surburban st, you'd have to dodge and weave your way through the broken glass, discarded food scraps and other random assortment of litter/dog faces etc.
Click to expand...
We have plenty of those suburbs too.

But of course; you have to travel around to see them...a lot of folk don't - they travel; but only on holidays to favoured destinations - no-one is going to travel to say; Noble Park where my in-laws live. Talk about a war zone. You wanna hear about the real Aus - ask a courier, or truck driver, or taxi driver. They go to all the places the average professional yupp never sees.

As for our vehicles - yes, you see the odd clunker cruising around; and being under 8 years old might be an overstatement (she has to sell papers and make the Poms feel bad), but all in all, the roadworthyness of our vehicles here isn't really that shocking.
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Depends entirely on where you live and the demographic in that area.

My current field of employment is in the Automotive industry - car repairs, servicing, tyres etc.

As a result, I find I notice cars and tyres all the time now...I see patterns that I never did have any interest in at all.

We went to Malvern a while back to pick up a pram we bought on Ebay...nothing but European cars and SUV's everywhere - not a 300,000km Falcadore or other shoitbox in sight....gleaming, late edition beauties for the most part.

Go to Noble Park, Frankston, Dandenong, or even Dromana (where I live and work) and all you see are Falcadores, Camrys, Corollas, thrashed tradie utes and hoon/bogan mobiles on their last legs, and the like - clunkers with waaay too many KM's on the clock and no maintenance which are mostly t.u.r.d.s that the owners want us to try and polish. :rolleyes:

Limes: $2.25.
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My wife goes up to the Dandenong market on Saturday mornings (I hate the joint, and refuse to go - stay home and mind the two older kids is far better).

She can get a whole weeks' fruit - and the quality is terrific - for under $20. I could go on about the meat and fish, too.

So, this bloke is on something.

Mind you; the prices at these places are also a bit demographically orchestrated. Your postcode will have an influence on what you pay to a degree. We saw this in the USA as well; postcode (sorry; "zipcode" in the YooEss) affects price there too.
 
Ausprop said:
I think the good times have come to a sudden stop anyway. The cupboards are bare, the rest of the world is in recovery and we are stalling.

IRs will necessarily be slashed, the dollar will drop, living standards will then plummet.
Click to expand...
It isn't sudden it has been a slow lingering strangulation, starting with the start of the last round of interest rate increases and labours reckless spending, the general population are like frogs in hot water and leaders wont acknowledge the elephant in the room. Ye reap what you sow.

I remember you saying not long ago the dollar was going up over a 1.20. The dollar has to drop to stop living standards from plummeting. Even at 1.04 Australia is uncompetitive and industry is shutting down
 
buster said:
It isn't sudden it has been a slow lingering strangulation, starting with the start of the last round of interest rate increases and labours reckless spending, the general population are like frogs in hot water and leaders wont acknowledge the elephant in the room. Ye reap what you sow.
Click to expand...
I've been bangin' on about it for at least a year now, and there were plenty of folk here on SS saying "you don't know what you're talking about you old deehedd; I saw some stats on line".....
 
Personally I noticed things are cheaper at the shops. Especially imported stuff. Clothing are cheaper, Kmart country road dj etc. fresh produce too. But fancy stuff like individually wrapped cheese still expensive.
Kmart has gone really cheap on clothing. I remember toys were so expensive 10yrs ago and now they re cheaper or same price.
As consumer I enjoy the high oz dollars.
 
BayView said:
I've been bangin' on about it for at least a year now, and there were plenty of folk here on SS saying "you don't know what you're talking about you old deehedd; I saw some stats on line".....
Click to expand...

That's the thing about statistics you need to interpret them.
You look at the financial results of Coles and Woolies and they show food price deflation has occurred over the last few years.
The statistics say that as a whole Australians have been buying imported cars and traveling overseas in record numbers to take advantage of the exchange rate forgoing the locally produced cars and tourist destinations.
Statistics show that as a whole before the GFC Australians were racking up debt by spending more than their income, after the GFC Australians are saving more (which also includes making extra payments on mortgages), so that savings rates have returned to long term trend.
IMHO a lot of what has happened recently is Australia coming to terms with their wealth not growing at above trend rates any more, (as illustrated by stagnant land prices and recovering super portfolio) but also those who can afford it are taking advantage of cheap overseas holidays and goods.
 
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