By Lauren O’Connor
Soaring prices in the Sydney property market are causing “housing stress” for the younger generation, according to NSW peak body Youth Action.
The City of Sydney has reviewed the outcomes of a public talk they held in early March to discuss the city’s housing crisis.
The report concluded that many essential workers have been priced out of the metropolitan housing market and government policy must respond to this.
Statistics suggest the average house price in major cities costs up to 11 times the average wage earned. Managing Director of Youth Action, Katie Acheson, said low-income earners are spending more than 30 per cent of their income on rent.
As a result of the financial pressure, one in five young people experience housing stress and homelessness services have reported a rising number of young people on the streets.
“At the moment about 50 percent of people seeking help from homelessness services are under 25 and that’s really indicative of what’s going on in the housing and rental markets,” Ms Acheson said.
“We hear it all the time from young people. It’s about our ability to have a secure and safe place to live. We’re not seeing the federal and state governments rise to the challenge yet.”
Renee McGrath, 30, has been looking to break into the property market for a year. She works for a major bank while share-housing in Balmain.
The young professional said after coming back from living in London, buying a house was more difficult than she’d expected.
“It’s proven quite competitive and anything I really love had gone for a lot more than I thought it should. Some of the properties I have seen I would not buy on a slow market and they have gone for a surprising amount,” she told City Hub.
At auctions Ms McGrath has been up against young professional couples, families and investors with higher incomes.
“I am a bit disheartened by the whole experience so I’ve actually put it on hold for the moment. Owning a house has always been something that is important to me. Having a place to make my own mark on is something I aspire to,” Ms McGrath said.
She said in the meantime finding a balance between her work and social life are taking priority over making decisions about investing in property.
Treasurer Joe Hockey told ABC’s Lateline program he was “alarmed at the inability of young people to access the housing market in a way they previously have been.” Mr Hockey raised his concerns with state treasurers last month and attributes the complex problem to a lack of housing supply. But Shadow Treasurer Chris Bowen pointed to negative gearing as the main factor in inflated housing prices.
The City of Sydney recommended in the ‘Housing Issues Paper’ on April 21 that the State government address “chronic underinvestment in public housing by successive governments”.
The recommendation for a broad range of tenures and housing types ranging from non-market, rental, investment and affordable first homes were also made.
Ms Acheson said that putting housing affordability on the political agenda was a win for young people.
“We want decision makers and the people in power to start questioning how these policies and how our current situation effects young people. And what are the ramifications if we do nothing?” she said.
“I heard great things about [City of Sydney’s public forum]. There has been a buzz since then where the business organisations, local government and state government organisation were all having conversations they weren’t having before.”