Tuesday, July 28, 2015

Crocodile Mel[anie?]

G'day to ya, Mate (Mr.Treasurer);
Are you aware of what the average Australian wage is?
Are you aware of what the average Australian mortgage in Sydney is?
Are you aware of the first-home buying process?
Just in case these facts and figures aren’t available to you, I thought you might be interested.
That's from Australian citizen Ms. Mel Wilson's open letter to Australia's Treasurer Joe Hockey. She goes on to point out that the average take home pay in the island continent/nation is about $900 per week--that's Aussie dollars, USD would be less than $700.
The median house price in Sydney, according to the Domain Group Housing Price Report, as of March 2015, was $914,056. [a little less than $700,000 USD]
Not sure if you know how first home buying works at the moment, but you normally need a deposit of about 20%. This is to pay for the Stamp Duty (which is a State Tax you must pay every time you buy a property), and also to assist in the approval process so that you don’t need to pay Lenders Mortgage Insurance.
So in this instance, the first home buyer would need about $182,811.00 saved to purchase a house that is the average price in Sydney.
Mel goes on to do the math, at $900 per week, an average Aussie would have to save every dime he/she made for 4 years (200 weeks) just to accumulate the down payment. Assuming that the price of the house doesn't escalate over that same time, which it surely will.

And what would the monthly mortgage payments be on the balance of the purchase price? About $1,100 per week Mel figures. So, she concludes her letter thus;
Just slightly confused as to what you were thinking when you said these words at the media conference in Sydney.
Looking forward to another one of your politically correct, direct and well thought out responses.

Another baffled Australian
Mel didn't bother to ask why Australia has restricted the supply of land on which new houses can be built. As New Geography's Wendel Cox commented on the letter;
In a later statement, the Treasurer, to his credit, indicated the need for strong lobbying of the states to make more land available to increase supply
Well, that's old geography!

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