Be In Earnest - The Great Australian dream

“Owning a detached house on a fenced block of land”

This was once known as “The great Australian dream”

Mr Toastmaster and fellow speechcrafters!

Is it really worth it to buy a house in Australia?

Housing prices in Australia have hit record highs;

In fact no normal person can afford to buy a house in Australia.

Recently, a survey carried out in the cities around the world where the population is more than one million people.

This survey shows that from the 12 least affordable cities,

5 are from Mainland Australia.

All five state capitals considered as severely un-affordable cities.

Sydney is in the top of the list followed by Melbourne, Adelaide, Brisbane and Perth.

Canberra, Hobart and Darwin were not included in this survey;
not because they are affordable, but because they have less than one million people.

According to this survey;

In Adelaide you will need to pay 7.1 times your annual salary to buy a house.

Median house price in Adelaide is around 410,000 dollars.

When we add other buying costs such as stamp duty and pre-purchase inspection; the price will be 430,000 dollars.

To buy this property without a mortgage insurance;

You will have to save 86,000 dollars for the 20% deposit.

If you save 1,500 (Fifteen Hundred) dollars a month, it will take up to 5 years to save for the deposit.

How do you find 1,500 dollars per month?

Will you get an immediate salary increment because you have started saving for a house?

No…
You have to sacrifice your day to day entertainment costs,
Long Vacations, Exotic Holidays, Family parties and Kids birthdays to save money.

Once you have saved enough money for the deposit;
You go and buy the house you need.

Your mortgage amount will be 344,000 dollars, and your loan term is 30 years.

Here comes the bitter part,

Now you have to pay 2,500 dollars per month as the Loan repayment;

Plus you will have to spend extra 6,000 dollars per year (or 500 dollars per month)
as council rates, Maintenance cost and home insurance.

You will continue to pay this money for the next 30 years.

Now we will look at the bigger picture;

If you start saving at age of 20, you can buy your home at age of 25,

And then you will continue to pay for the mortgage for another 30 years.

By age of 55 you are the 100% owner of your dream home.

But….You will miss the enjoyment of your life for 35 years.

You will miss Long Vacations, Exotic Holidays, family parties and Kids birthdays.

Sacrifice 35 years of your life’s best time; just to own a house?

Is this really worth it?

Mr Toastmaster…