It's, like, hard to make Gen Y act responsibly

[yieldmatters]

YM, with regards to your posts above:

What do you think these people should do?

A) Pi$$ and moan about how unfair it is, cry to all those that listen that the system can't go on like this and things need to change, govt's need to act, all housing is unaffordable, they shouldn't be made to live below the level they're willing to etc.

or

B) Realise that (for now anyway) the reality is what it is, even if they're not happy about it. Deal with it, and find an alternative.

In this particular post p ) I'm not trying to argue that point A is wrong - let's even assume it's right (which I don't believe). What should these people do? Wait for change which may take ? 5, 10, 20yrs, perhaps never - or just suck it up, and do something?

As a society we can argue these points till we're blue in the face, but for individual people - how will that help them establish themselves in life?!

Good post Steve - absolutely correct. My rant is a political one - hence the good reactions I suppose (do we have a politics section?!). On an individual level you just have to accept your lot and get on with it.

Wherever I can (including online forums) I am pushing for a change in culture among those older and those more well off (usually the same people). Every time the median house price rises you hear a collective cheer. What I'd like people to think is "that makes us just that bit poorer as a society - something we all need has gone up in price".

I challenge anybody to prove to me how property (unimproved and in aggregate) can outstrip CPI, outstrip wages and make us collectively better off. Simple fact is it can't.

Before anybody brings it up, share prices outstripping wages and cpi can make us collectively better off as the companies behind those share price rises are now more efficient - producing more with less.

 

[steveadl]

For every young whinger you find, I can find you one who doesn't whinge and just gets on with reality.

I love materialistic stuff - I couldn't live without my TV, foxtel, DVD's, fast food, nights out, ipod etc etc etc. Unfortunately I couldn't afford much (read any) of it when I was saving up for my first house, but there ya go! Fast forward 7yrs and I can have all the dodads as well.

They've grown up with the message - imposed on them by their elders - that they can have anything they want immediately. Don't need to wait for it - just put it on credit!

All young ones have grown up in this environment. If some can make it with their own house etc., why can't others? It's the attitude, and choices they make as a result.

Why do some people believe it's a right to be able to afford all the consumer goodies AND be able to get the house you WANT at the same time? Unless you're on a very above average income - it aint gonna happen!

 

[skater]

What you are doing here skater is taking the average (or median) income and saying "hey - they can afford to live in a poor area". But the point is, that as time goes on, the poor areas become more affluent. You take, for instance Dundas. This area had many a housing commission home & was once a poorer area. However, these days this is what you get for $440k http://www.realestate.com.au/cgi-bi...t=&header=&cc=&c=58030968&s=nsw&tm=1202521975 a crappy 2 bed house, older than the ones at Mt Druitt. That is all well and good - but where then do the poor people live? They rent I suppose? Yes, they rent. They have always rented & this will never change. From who? From a landlord who is willing to make up the difference between what the poor person can pay and what the bank asks for in interest. As I've said many times - landlords are very generous but it's hardly sustainable. But there's the rub. Rents are not determined by what a poor person can pay, they are determined by supply & demand.

Where I do agree with you lot is it takes time to trade up - somebody on three times the average income probably can't instantly move into a house 3 times the average. It might take 2 stabs at it - a 20 year loan, then a trade up, then another 20 year loan.

The fact of the matter is, that unless you are earning a full time income, you are not going to be able to purchase a house. Any house. People not employed, by definition will be poor & they will have to rent. If you are earning the average income, then you are only going to be able to purchase a cheaper house, however if you have children, the government is very generous with benefits, so that average income goes up substantially. Those on the higher incomes will be able to purchase more expensive houses.

 

[BayView]

Before anybody brings it up, share prices outstripping wages and cpi can make us collectively better off as the companies behind those share price rises are now more efficient - producing more with less.

You mean like during the dot.com boom where there were share prices through the roof, without any income?

And, then all of a sudden; they weren't.

 

[BayView]

It's interesting to me when oldies have a go at youth. Interesting because they look down their noses at what they have created. With the constant bombardment of advertising, marketing, consumerist ideals, products that don't last, continual visual stimulation no matter where you look - all created by the 40+ year olds (yes, I can generalise too), is it any wonder that youth today want everything handed to them?

They've grown up with the message - imposed on them by their elders - that they can have anything they want immediately. Don't need to wait for it - just put it on credit!

Then the wrinklies have the nerve to tut tut at the kids for doing exactly what they were supposed to do - pander to their materialistic desires. A lot of older people say 'you need to take responsibility for your own life and the choices you make' well how about taking a dose of your own medicine and accept responsibility for the consumerist society YOU have created.

Mark

Note: that bit about responsibility I believe in myself wholeheartedly. There are two sides to this coin - only one of which seems to get any press on this site. Figured it was time to put the other side out there as well.

Well, here's my take on that.

You make it sound like the oldies were always old. How old do you reckon the oldies were when they were inventing all the evil doodads that are keeping all the kids poor these days?

Actually; most of the really cool electronic doodads are invented by the younger people who take the jobs of the older people who get made redundant at 40. They are more interested in that stuff than oldies, so are more likely to think about it and create it. Of course; these younger wizzkids eventually become older too, get rich and just fund the production of it all.

As one of the older brigade who tut tuts the kids; we only look down our noses when the kids take for granted what has been created for them, and whinge that things are not easy for them. Like they are the only ones who've ever had it tough.

The oldies on this forum who take this view are those who mostly have become successful through hard work, sacrifice, dedication, and taken responsibility for their life etc, so they are more likely to be critical of a lazy, sulky adolescent who bleats that it's all too hard. Over-achievers never have respect for under-achievers you'll find.

I have plenty of respect for any young person who wants to get off their ar$e and work hard, make a sacrifice to get ahead. Most successful older people I know are exactly the same.

The materialism aspect only comes into it for me when the kids spend every cent on the doodads, make no plans for their future, then whinge because they have no money and can't afford a house with 5 bedrooms. No one holds a gun to their head and tells them they must consume, consume, consume.

Any young adult who can pass Year 10 education has the intelligence to make a decision for themselves about where their money goes. It doesn't take too many months of escalating interest on the credit card to work out that they are spending more than they can afford.

God knows why they would have a credit card at this age anyway.

Blame the parents for that one I guess. You know; those older people who have no understanding of the kids' plight.

 

[yieldmatters]

You mean like during the dot.com boom where there were share prices through the roof, without any income?

And, then all of a sudden; they weren't.

Yes - exactly like that. As time goes on our views merge closer and closer together.

 

[wylie]

They've grown up with the message - imposed on them by their elders - that they can have anything they want immediately. Don't need to wait for it - just put it on credit!

What a load of cobblers? I joined the CBA in 1976 at 16 years old and I remember when credit cards first entered the scene. So saying that boomers just put things on credit is just wrong.

I also remember the first teller machines coming on line. There were initially six of them in Australia (from memory) and the trade off was longer hours for the admin and head office staff (which really sucked) which have not reduced since.

 

[wylie]

They've grown up with the message - imposed on them by their elders - that they can have anything they want immediately. Don't need to wait for it - just put it on credit!

I joined the CBA in 1976 at 16 years old and I remember when credit cards first entered the scene. So saying that boomers just put things on credit is just wrong.

I also remember the first teller machines coming on line. There were initially six of them in Australia (from memory) and the trade off was longer hours for the admin and head office staff (which really sucked) which have not reduced since.

 

[LynnH]

It's interesting to me when oldies have a go at youth. Interesting because they look down their noses at what they have created. With the constant bombardment of advertising, marketing, consumerist ideals, products that don't last, continual visual stimulation no matter where you look - all created by the 40+ year olds (yes, I can generalise too), is it any wonder that youth today want everything handed to them?

They've grown up with the message - imposed on them by their elders - that they can have anything they want immediately. Don't need to wait for it - just put it on credit!

Not all 'oldies' have created such children, and not all 'elders' have imposed these messages on their kids.

We have always taught our girls from a young age about the persuasive (and pervasive) effects of advertising, TV shows, peer group pressure. We were 'horrible' parents who said NO to unsuitable TV/video viewing, to hanging around shopping centres for 'something to do' and to other such meaningless activities. And they were all presented with a range of activities such as reading, nature trips, going to the museum/etc, going to 'Dad's shed' to 'make' all sorts of creations, growing vegetables, sewing, cooking, art, music, all types of sport, etc etc! And we are definitely not alone in having done this, as a number of other forumites have indicated in various posts (Lizzie, Wylie, Skater and Daz are just a few who spring to mind - apologies to others I have missed ).

Sure, at the time, we were the 'big baddies' - my eldest even told me that I ran "a militaristic dictatorship" at one time!! (That really cracked me up! ) But, nonetheless, we all survived!

So just as there are a number of Gen Y getting off their butts and looking after their futures, there are also a number of their parents who have tried (and mostly succeeded, I think) in getting the important messages across.

Cheers
LynnH

 

[MishMash]

boo f**king hoo to generation Y. i am sick to death of people my age saying they will never be able to afford a house. and also sick to death of people saying they don't earn enough to afford a house. get used to the idea that you won't be able to afford a lovely 2 storey house in the area that you grew up in, or your dream apartment in the CBD. just buy SOMETHING to get started.

When i bought my first house at 19 it was $249,000 and I earnt just under $40,000. I had a $20,000 deposit that i saved plus FHOG. The deposit was saved over about 18 months? And for 6 or so of those months i lived by myself and was on traineeship wages.

How I saved my deposit:
a. don't smoke or drink or partake in recreational drugs (at all)
b. didn't go out (maybe once a month?)
c. didn't buy anything other than paying bills and buying food

it's really very simple. i think people that stay at home living with their parents are a bit pathetic. grow up and get your own life. i moved out at 17 and so did my brother. it taught us independence, budgeting (although our parents did instil basic budgeting skills in us, there is nothing better than learning out in the real world when you only earn $200 a week after tax and realise money doesn't grow on trees). our parents struggled when myself and the 2 sibs were young, my dad worked 7 days a week for a long time and i know how hard they have worked for the big and beautiful home they live in today plus their investment properties. i didn't grow up expecting that i would move out into a big home with a plasma tv and every other luxury.

young people need to get realistic, stop whinging and actually do something about your situation. save money, stop spending it on ****, research areas where you could afford to buy rather than writing off property as unaffordable purely because you can't afford to buy in that nice beachfront area. for those that went to/are in uni and say they are disadvantaged because of the big hecs fees etc, THAT WAS YOUR CHOICE TO GO TO UNI. you could have worked and saved money first. everyone makes their own choices, i am doing uni via distance now because i chose to work first so i could save money to buy a house. the argument that i get is that they will only be able to find a low paying job so what's the point. not always true - started on $12,000 as a trainee - went to $40,000 after a year and then $67,000 2 years after that. it IS possible to find good jobs without going to uni straight out of school.

what is more irritating is the stupid gits that tell me i'm stupid for buying property and that in the long run property is a crap investment, i am wasting my money etc etc..generally i find the people that are spouting this rubbish at me have quite a bitter attitude because they spend all of their money on crap and then can't buy a house so then they like to tear down the people that actually sacrificed (what a dirty word) luxuries so they could afford property.

anyway this is quite a rambling post i guess in closing all i can say is harden the f**k up generation Y.

 

[imonmyway]

Take it easy on Gen Y I think its more the media whinging for them, they definetly stay at home to long but as there parents are more understanding then my generation why would they leave home.

I have about 20 of them working for me at any one time and I find them generally very good they work hard and don't whinge about not being able to buy houses. They seem to have a fairly good grasp on the world and what is required in money terms to be part of it.

They have a lot more idea then I had in my teens, 20's and early 30s when I drank smoked travelled partied and dabled all my wages away but what a wonderfull time I had.

Every generation beleives the next is not worthy it has been the prevailing attitude for thousands of years.

 

[BayView]

Yes - exactly like that. As time goes on our views merge closer and closer together.

No they don't YM, unless you are moving your views towards mine, 'cause mine aint movin' towards yours.

You are an analyst of models and stats and probably won't ever buy; while I just keep on buying when I can afford to buy.

I was being facetious about the shares YM.

A share that goes through the roof with no earnings or production doesn't do anyone any good; other than the shareholders who were lucky enough to sell theirs before they ultimately crashed.

Exxon just posted a profit of $40 billion - highest in US history. Meanwhile, the price of oil hits $100 a barrel.

Are we all better off for their share price going up and their profits soaring, and the fact that they can produce more with less? Um... no; unless you are an Exxon shareholder.

A house, however, goes up in relation to affordability, supply and demand.

When they become unaffordable, people stop buying until the wages go up to match, or they borrow more money if the Lenders deem them to be a good risk. Recent lending policies notwithstanding, and it is coming back to haunt everyone. This is a cyclical factor; easy finance; more demand/difficult finance; less demand.

Are we better off because of rising house prices? Yes; every person who owns one will enjoy the increase in their wealth that an increase in value brings over time. For most people (less than 30% of home owners are investors) it is their biggest, and only investment. If they didn't have a house that went up in value, they would be much, much poorer; especially at retirement.

For those who are putting their first foot on the property ladder, they have it all ahead of them. They will make money; sometimes more quickly than others.

The trick is for them to buy the right property that will accelerate their progress up the ladder. Not every house is ridiculously overpriced, even now.

I don't know why you have such an aversion to house prices going up? Yes, they are more expensive (generally) now than in other periods of history, but it is part of the cycle.

If rate rises continue, and lending practices tighten up, the prices will be affordable before you know it because there will be no buyers, so prices will stagnate, while wages still increase and voila!

 

[BayView]

They likely bought it off a developer at the cost to actually produce it plus a fair profit. It's a novel concept these days.

And that doesn't happen now?

Developers didn't just suddenly start trying to rip people off with price in the last 5 years Yield. Are you that naiive? Getting ripped off in real estate is a very old pass time.

Regardless of the source of the property, whether the new estate out in the sticks, or the dilapidated second hand one nearer civilisation, every generation of first home buyers has had to buy where they could afford, and that was not an inner-city apartment, or house on an acre in Brighton.

The only thing that's changed these days is the perception of what a first home should be. I think you have that perception too, unfortunately.

Some people have the right mindset though; we are in the process of selling all out stuff ready to move back to Aus. We have all the stuff advertised on Craig'slist.com.

All the gear sold so far has been to younger kids/couples who are setting up house and need the cheap lounge suite, bed etc.

They haven't gone the "Harvey Norman" route; loading up with furniture on the 24 month interest free terms, to go into the 35 square house they bought on 95% finance.

They've gone for the 1980's, 11 square, 2 bed townhouse/condo in the not so good parts of town; the affordable ones.

 

[yieldmatters]

young people need to get realistic, stop whinging and actually do something about your situation. save money, stop spending it on ****, research areas where you could afford to buy rather than writing off property as unaffordable purely because you can't afford to buy in that nice beachfront area. for those that went to/are in uni and say they are disadvantaged because of the big hecs fees etc, THAT WAS YOUR CHOICE TO GO TO UNI. you could have worked and saved money first. everyone makes their own choices, i am doing uni via distance now because i chose to work first so i could save money to buy a house. the argument that i get is that they will only be able to find a low paying job so what's the point. not always true - started on $12,000 as a trainee - went to $40,000 after a year and then $67,000 2 years after that. it IS possible to find good jobs without going to uni straight out of school.

I guess who needs uni if the value of property just goes up and up? It's like a gold mine in your own backyard!!

In all seriousness though I'm glad you decided to go to uni via distance in the end. It will be very worthwhile both financially and personally.

Cheers, YM

 

[yieldmatters]

A share that goes through the roof with no earnings or production doesn't do anyone any good; other than the shareholders who were lucky enough to sell theirs before they ultimately crashed.

I'll just take that and change a few words ....

Property that goes through the roof with no earnings or production doesn't do anyone any good; other than the property owners who were lucky enough to sell theirs before they ultimately crashed.

That was where I saw our views coming together. Just stirring. Thanks for your response though - always good for an argument.

YM

 

[natmarie73]

I'm on $40K as a Banking Officer at Elders which is ment to be quite good for someone fresh out of university.

LOL - $40,000 graduate salary in WA! No wonder he's cranky. He's probably on the lowest grad salary in the country.

Anyhoo, there is light on the end of the tunnel. When I was in my teens and 20's I was a Gen Y too (financially that is). I spent all my hard earned on travelling, partying, clothes, shoes, doo-dads etc etc and honestly, the thought of buying a house never entered my head - that's what stuffy old people did. I actually remember thinking "Why on earth would anyone buy a house if they don't know where they will live for the rest of their life?" Now, not so many years later I have a few properties and a bit of a share/funds portfolio and have totally changed my outlook on finances etc.

It's probably not fair to lump all Gen Ys in the same group, I personally know some very young people who are buying property in Brisbane, and they are not on great salaries either. The fact that there are some Gen Ys out there who are even thinking about buying houses (even if it is just whinging about the price) before they are married and planning a family is a step forward from the previous generation I think.

P.S - Dazzling, I would so go and tell the next door Dad what his son is planning... he might want to change his will after hearing it!

 

[BayView]

I'll just take that and change a few words ....

Property that goes through the roof with no earnings or production doesn't do anyone any good; other than the property owners who were lucky enough to sell theirs before they ultimately crashed.

That was where I saw our views coming together. Just stirring. Thanks for your response though - always good for an argument.

YM

Always enjoy our intercourse.

I thought you'd disappeared a few weeks ago.

 

[BayView]

If Gen Y doesn't get their act together soon there are going to be big issues funding all the boomer's property sales when they wind down their realestate holdings into more liquid assets.

It'll be fine; there's always someone right behind them getting older who wants to move into their pad as soon as they curl up their toes.

Sorta like that scene in "The Master's Apprentice" when Mickey Mouse brings the broom to life, it then multiplies and they are a never-ending procession with buckets of water to pour into the basement.

Aren't most of the retirees in Australia on the pension? There'll be very few with any "holdings" to liquidate. The rest will be happy to get enough to go into the 'assisted care facility'.

I think I read somewhere that out of every hundred people born, at retirement there are 60 dead, something like 35 on the pension, 4 financially well off and 1 rich?

 

[luce.rocks]

Always enjoy our intercourse.

... teeheehee

 

[BayView]

... teeheehee

AHA! I knew someone had a dirty mind in here.