I’m so glad a millionaire took it upon himself to tell me why, at 26-years-old, I don’t own a house. I thought it was because of the so-called property boom, but apparently it is because I (my generation) spend too much on smashed avocado toast.
I know. This is nothing new. The complaining of house owners and Baby Boomers has been in the media for a while now. It was just the straw that broke the camel’s back.
Thank you, Sir. Sincerely, I thank you…
Here I was thinking it had something to do with the cost of living and a system that incentivises investment in housing, oh and that student loan.
On that. Let’s start with student loans. Mine came to a whopping $37,103.57, by the way. And might I add, as of 31 May I have fully paid it off. Interest free, sure, but paying for university is still a fairly new idea and a rather daunting thing to be saddled with at graduation. There goes a percentage of your wage each paycheck, affordable yes, but tapping away at those savings margins.
I’m aware mine was a bit more than most. An ill-advised first year foray into law and science (fun fact: papers with labs are shockingly expensive), which meant I had to attend summer school (read: also expensive) to ensure I kept on-track to graduate with my BA at the same time I would’ve with the BSc. Add to that a one year Postgraduate Diploma – no one told me those things were $10,000!
I was lucky enough to only have to borrow fees as it was possible for me to study in my hometown. This meant I could live at home making my loan balance less than it otherwise would’ve been. I’m the first person to admit I had it easy with my living conditions and part-time job, but I still ended up lumped with nearly $40,000 in debt. So next time you’re complaining about millennials and their extravagant lifestyles ask yourself this: did I pay for my tertiary education? Chances are, if you graduated before 1990 you didn’t. If you don’t believe me see this rather insightful article from Salient.
Now let’s look at cost of living. According to CareersNZ the median income in 2016 was $48,800. I can tell you many millennials aren’t making that much in their first jobs – at least not for a few years. I can confirm we don’t go out looking for a job with big numbers in our head – we are realistic and just want to make ends meet and try to save some money. But with rents rapidly rising having a savings margin is becoming harder and harder.
According to the TradeMe Property Rental Index things aren’t looking up for new graduates either. Auckland rents hit a new high in April, with the median cost at $530 per week. The report also notes Auckland rent rises are lagging behind the regions – so you can imagine how hard these rises hit the pockets of students around the country before they even graduate!
Rent prices aside, most other costs have increased and that’s not just because of inflation. So with more expensive food, utilities, petrol, insurance and so on you can see how this hits the pockets of millennials. Sure, there are the ones who don’t try save, and spend their money frivolously – but you can’t tell me that’s anything new!
There’s also the problem of needing a higher percentage for a deposit for a house. Most lenders now require 20%, tell me – was your minimum deposit that high?
But, alas; according to Mr Millionaire Property Tycoon, I was wrong. None of these very real problems are the cause of my generation’s housing struggle. My perception is apparently a delusion. One more thing to worry about. And I mean, I already have enough on my plate – have you seen the price of avocados lately?
Sure, there are success stories out there – those rare few who have done it alone and others who have had help from the Bank of Mum & Dad – and that’s great, but those stories are the exceptions, not the rule
With all of these factors at play, home ownership in the current housing market for someone like me seems impossible. Is the quarter-acre block and a white picket fence destined to become a nostalgic installation in our national museums as something that only existed ‘back in the day’? Probably. And most of us are in the market for something much smaller anyway. More importantly, with this being an election year, which political party is willing to step up and deliver a solution that not only speaks to people like me, but brings actual results?
Politicians, I’ll leave that particular ball in your court.Support Villainesse