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[pr0cs]

He's totally right and social Media makes things even worse.
I have friends that bitch they can't afford to buy a house because everything is overpriced but then they post pictures of their latest session at the tattoo parlor, new toys, vehicles, gadgets, trips and whatnot.
You want something you need to make sacrifices to get it, no one seems to know that anymore.

 

[legend166]

That's what my comment was meant to say. People itt seem to be shitting on what he said, but he's just saying frivolous purchases add up.

The reason people are saying his comments are dumb is because frivolous purchases are reason number 903 on the list of why millennials in Australia can't buy property. There are huge structural disadvantages built into the tax system that (along with foreign investment) make it exceedingly difficult to buy property in Sydney and Melbourne.

 

[EdibleKnife]

Why do you need pain meds?

I mean, seriously, what condition do you have? Out of curiousity

Sorry I missed this. I deal with both Sickle Cell Anemia (blood that doesn't carry oxygen well and can leave extremities critically denied of O2) pain crises and Flat Back Syndrome (A defect where I have a spine without the curvature and my muscles have reached the point where they can't support my upper body resulting in constant pain). Wubba Lubba Dub Dub!

 

[T-0800]

The reason people are saying his comments are dumb is because frivolous purchases are reason number 903 on the list of why millennials in Australia can't buy property. There are huge structural disadvantages built into the tax system that (along with foreign investment) make it exceedingly difficult to buy property in Sydney and Melbourne.

People need to be prepared to move. I know that isn't as easy as it sounds but it isn't impossible either. I live in regional city (pop 15000 - Australia) and am very happy with the lifestyle we have. Nearest capital city is only a 30 minute flight away should we want to attend the cricket or whatever. Capital city living is overrated, but that's just me.

 

[Platy]

"Take care of the pennies and the dollars will take care of themselves" is what he is basically saying. I agree, although in my country avocados are much cheaper and we enjoy a lot of avocado toasts =P.

You know those types of drugs that you put on water and this happens ?

Here we say to close your hand for exepenses so tight that you can swim and nothing will happen to that pill thing =P

 

[Theonik]

He's totally right and social Media makes things even worse.
I have friends that bitch they can't afford to buy a house because everything is overpriced but then they post pictures of their latest session at the tattoo parlor, new toys, vehicles, gadgets, trips and whatnot.
You want something you need to make sacrifices to get it, no one seems to know that anymore.

What's the down payment for the average $500k house in Sydney, how much do you think you need to be earning to be able to borrow the rest?

That's maybe $50-100k? Borrowing the remaining $400k would cost about $734k on an interest rate of 3.77% for 30 years. This is all ignoring the misc costs associated with buying and maintaining a house. The payment on such a mortgage would be in the order of $2.1k a month or so. And that's after 5-10 years of saving.

I kind of doubt your friends complaining they can't afford a house can't do so purely because of lack of financial discipline. And in the first place, you are failing to answer how old your friends are. What do you consider a reasonable amount of time a person should wait before they are allowed to accumulate equity on their homes. 40?

 

[GatorBait]

Millennial wage increases aren't keeping pace with inflation, whereas housing cost increases are outpacing inflation. Combine that with the fact that millennials initially entered a job market with depressed wages and with record-high college debt, and avocado toast ends up being the last thing preventing them from entering the housing market.

Edit: I'll also note that professional mobility is a heightened requirement for many millennials to be able to obtain employment in their fields. They're moving to where the jobs are. They don't yet have the luxury to be able to move to where they can better afford a house.

 

[Generate]

I bought a home and I can afford to eat some avocado toast so suck on that Mr investor!

 

[EXPotemkin]

If ur HS and College kid...u would work for $15 ...shit I used to work two job for way less ...and I grew up in the city

I duno, I guess I took pride in making my own money and actually enjoy going to work and meet people instead of doing the social media thing

I don't. I fucking hate work. Literally just do it to get by. Don't really understand the idealistic crap behind this either.

 

[M3d10n]

This idea that the reason we are poor is because of our day to day spending is wrong, sure, we would get save more money by the end of the month but it's not realistic to expect to save enough for a current market price house at the expense of some mental welfare. Frivolous things, gym, that special food item you like, etc.. are what keeps us going day to day.

Funny how rich fatcats never cry when we spend our income on their products.

If one day everyone suddenly cut down their frivolous consumption down to Scrooge McDuck levels of penny pinching the economy would probably collapse. Apple, soda brands, cable TV, videogame companies all going bankrupt left and right trying to survive in a world where only the 1% actually consumes anything beyond the subsistence levels of food, clothing and shelter.

 

[remz]

If one day everyone suddenly cut down their frivolous consumption down to Scrooge McDuck levels of penny pinching the economy would probably collapse. Apple, soda brands, cable TV, videogame companies all going bankrupt left and right trying to survive in a world where only the 1% actually consumes anything beyond the subsistence levels of food, clothing and shelter.

That's apparently the world they want tho because god forbid someone that isn't a millionare spends money on something that makes them happy

 

[danm999]

People need to be prepared to move. I know that isn't as easy as it sounds but it isn't impossible either. I live in regional city (pop 15000 - Australia) and am very happy with the lifestyle we have. Nearest capital city is only a 30 minute flight away should we want to attend the cricket or whatever. Capital city living is overrated, but that's just me.

If people follow this advice they'll fuck up the housing market in the regional cities they move to.

Seriously see the forest from the trees.

 

[vegohead]

What's the down payment for the average $500k house in Sydney, how much do you think you need to be earning to be able to borrow the rest?

That's maybe $50-100k? Borrowing the remaining $400k would cost about $734k on an interest rate of 3.77% for 30 years. This is all ignoring the misc costs associated with buying and maintaining a house. The payment on such a mortgage would be in the order of $2.1k a month or so. And that's after 5-10 years of saving.

I kind of doubt your friends complaining they can't afford a house can't do so purely because of lack of financial discipline. And in the first place, you are failing to answer how old your friends are. What do you consider a reasonable amount of time a person should wait before they are allowed to accumulate equity on their homes. 40?

Such a excellent example. I can't believe how how much money we spend on loans to buy property. It really puts into perspective why people commute up to 2 hours a day for work to afford cheaper housing.

Here in the Washington DC area houses average for 500k as well, it's ridiculous.

 

[legend166]

People need to be prepared to move. I know that isn't as easy as it sounds but it isn't impossible either. I live in regional city (pop 15000 - Australia) and am very happy with the lifestyle we have. Nearest capital city is only a 30 minute flight away should we want to attend the cricket or whatever. Capital city living is overrated, but that's just me.

Regional unemployment is a real issue, especially for young people. I'm not against moving to a regional area (I sorta did by moving to the Blue Mountains), but it's not realistic for the majority of people.

 

[valeo]

This was news a year ago in Australia..I am confused as to why this statement has had such long legs.

 

[SRG01]

That's because it's a great way to save a ton of money that racks up.

It's not about the avocado or the coffee, it's about buying shit you should be able to forgo in the shirt term in order to reach your long term goal.

My folks and their friends when buying houses 35 years ago were having sandwiches for dinner and stuff. Everything, and I mean everything, in their houses at first was second hand, either bought or given from family even carpets and kitchen units and appliances! My mum didn't get her own kitchen for about 23 years until I helped put it in with my dad. Before that it was out of my grandparents house and everything was wonky as it was already old and had to be made to fit.

My folks didn't start buying new carpets/appliances for probably 15 years after moving in, if they did it was cheaper stuff. The carpet in my folks main bedroom is still the same as it was the day they put it down, and it was my great aunts before they got it!

I mean, sure that's a great attitude at heart, but it's too idealistic when compared to real life. Wages have not kept up with inflation, especially with food and basic necessities.

All of this discussion about avoiding frivolous spending sidesteps the issues that millenials face today: unemployment, poverty, lack of social mobility and opportunity.

I love me some avocado but I just buy them by the bag at Costco in Edmonton. Get like 6 big ones for like 10 bucks.

Costco is the hotness.

I started saving my money by cooking my own meals and not buying video games that I don't have time to play anymore. 1 every few months maybe.

But the demand for housing is so much higher and good employment is so much lower that I wouldn't want to buy a house where I live. Who wants to spend 400 thousand dollars on a small house from the 1970's that needs thousands of dollars of maintenance and they keep raising the prices of services and utilities.

Gonna build a house in the sticks at some point instead.

Edmonton real estate isn't for the faint of heart, as homeowners are faced with two issues: moving increasingly outward for affordable prices, and ever-increasing property taxes to deal with the urban sprawl because people move outward for affordable prices, and the infinite loop continues.

 

[Elaugaufein]

This was news a year ago in Australia..I am confused as to why this statement has had such long legs.

Heh. Because Murdoch sets the tone of political discussion selling it to a class of people who really don't want to believe that policies that benefit them could actually be having a net negative effects. Sure they all bought their houses before Howard totally ballsed up the market (and the GFC sent it into overdrive) and are making a mint of it. But clearly their profit isn't someone else's losses despite housing being a moderately scare resource and completely non-productive as an investment (if you aren't buying property that's not viable as housing and making it so).

And there'll always be a market for how the young people of today are destroying society.

 

[The Fatal Englishman]

Such a excellent example. I can't believe how how much money we spend on loans to buy property. It really puts into perspective why people commute up to 2 hours a day for work to afford cheaper housing.

Here in the Washington DC area houses average for 500k as well, it's ridiculous.

He/she is understating the situation. Median house prices in Sydney and Melbourne are somewhere in the region of a million. Residential houses in 'middle class' suburbs approach 2-3mill.

As noted, a big part of the problem is negative gearing - which incentivises property investment by allowing tax write-offs against regular income. The primary benefactors of this are 45-65s and retirees while the losers are inevitably first home buyers.

 

[Dryk]

He/she is understating the situation. Median house prices in Sydney and Melbourne are somewhere in the region of a million. Residential houses in 'middle class' suburbs approach 2-3mill.

For reference:

 

[Frodo]

Has this been posted already?

http://chaser.com.au/national/mille...nt-by-giving-up-4-coffees-for-just-547-years/

 

[Theonik]

He/she is understating the situation. Median house prices in Sydney and Melbourne are somewhere in the region of a million. Residential houses in 'middle class' suburbs approach 2-3mill.

As noted, a big part of the problem is negative gearing - which incentivises property investment by allowing tax write-offs against regular income. The primary benefactors of this are 45-65s and retirees while the losers are inevitably first home buyers.

It's an easier argument to make by using very conservative estimates. Of course the real problem is much much worse.

And of course people will say 'sacrifices are needed. Move to a smaller house. Move further.' the point this falls apart is that, prices are universally high and this ignores that housing prices are often linked to access to jobs. That is to say by moving to cheaper housing also hurts the money you use to pay for said house.

 

[jellies_two]

Want to see what a million bucks buys in Sydney
The opposition party did a funny video a week or two ago.

http://www.smh.com.au/federal-polit...sydney-house-price-video-20170508-gvzzxu.html

 

[Ron Mexico]

It's an easier argument to make by using very conservative estimates. Of course the real problem is much much worse.

And of course people will say 'sacrifices are needed. Move to a smaller house. Move further.' the point this falls apart is that, prices are universally high and this ignores that housing prices are often linked to access to jobs. That is to say by moving to cheaper housing also hurts the money you use to pay for said house.

That operates under the assumption that the ratio of wages to property value is exactly 1:1.

So can we talk about assumptions for a second? Assumptions of profitability and subsequent bubble were what led to the .com bust. Assumptions of increased property values mitigating the absurdly high risk of subprime loans were what led to the '08 market crash. The list goes on and on.

Now with that out of the way, let's break that cycle. The housing market profusely sucks right now. There's no two ways about that and while you'll see gradual shifts in some areas and anecdotes all over the place, it's pretty much a given that the market is at the very least turbulent. With me so far? Good.

Making critical decisions, things like having a budget, being wise about credit, thinking outside the box, dispelling myths like the 20% down, pursuing as many options as possible isn't for today. It's for tomorrow or the next day when the market corrects itself (as is inevitable despite the fallacy of what goes up will continue to and what goes down will continue as well that cost so many investors to this day). You want to be in the best possible spot to pounce when things shift (whether personally, professionally, financially, etc) into your favor.

Saying "oh this will never happen so why try" is a recipe for disaster. I'm not saying don't have your avocado toast. Go for it. Enjoy it. Buy some video games. Go travel. But know at the same time how that plays both into your current budget and future flexibility.

The beauty of that old tweet from Wint is that there's actually a decent metaphor in there.

 

[Polioliolio]

Even if you spent 100 bucks on avocados a month, you can't do much with several years of not eating avocados. Fuck off millionaires. You may as well live a little. No matter how much you adjust your eating habits, you'll never be out of your social class.

 

[DrSlek]

https://www.youtube.com/watch?v=JGBQoddrDjw

 

[sandy1297]

Mr Gurner began his career as a property investor after purchasing a gym in Melbourne’s south in 2001 with the help of $34,000 borrowed from his grandfather.
Read more at http://www.9news.com.au/national/20...ials-over-spending-habits#pHtUyHCoVX7ycDI9.99

Yeah, if every millenials had his gramps they can buy all the avocados they wanted

 

[sixteen-bit]

 

[Fisty]

I live in California, avocados are like apples here. What else do you recommend?

 

[Scoops]

There's definitely people out there with spending issues. To simply say "fuck the rich guy's opinion" isn't necessarily fair.

I think Avocado Toast was just being used as an example. I'm 24, and plenty of people my age buy "trendy" overpriced stuff like that, go on Europe trips, buy designer shades/clothes and/or buy lots of alcohol despite not working a good job or a job at all.

The study in the OP is also fatally flawed. "Only 32% of home owners were first-time buyers in 2016" doesn't mean anything. It could just be people are moving more often and therefore are no longer first time buyers.

Home ownership is also falling out of favor though with younger generations. Millennials increasingly want to live in urban mixed-use areas which tend to be more rentals, and not homes you own. Many millennials I know also don't want to buy because they don't want to be tied down to one area too long and want to be able to move around more freely.

 

[Josh7289]

Too bad the supposed math that says not buying avocado toast will save you enough money to buy a house is flat-out wrong: http://www.slate.com/articles/busin...e_has_nothing_to_do_with_debt_an_excerpt.html

The real problem is a wider socioeconomic problem. Median incomes have been stagnant or dropping for decades. Meanwhile, fixed costs like housing, health care, and education have been rising dramatically. People are struggling just to get by, and for those few middle-class people who are able to afford things like expensive restaurant food now and then, even if they cut all of those unnecessary purchases out, it still wouldn't be enough to afford a house.

More: https://www.marketplace.org/2017/05/19/world/how-save-house-and-have-your-avocado-toast-too

It's not that people today are suddenly worse at saving. It's that people in the past had it much easier, so saving and investing weren't really an issue. Not so anymore. And this problem won't be solved by individual actions. The real solution can only come from a wider restructuring of the entire economy. And -- at least in my opinion -- that will only come about through bottom-up organization, sticking together, and pushing the powers that be towards making those reforms, through elections and collective action.

 

[digdug2k]

We just sold our first home and I never want to own again. Good investment though, I just hate doing the upkeep and constantly worrying about the market falling and leaving us under water.

 

[DrSlek]

There's definitely people out there with spending issues. To simply say "fuck the rich guy's opinion" isn't necessarily fair.

I think Avocado Toast was just being used as an example. I'm 24, and plenty of people my age buy "trendy" overpriced stuff like that, go on Europe trips, buy designer shades/clothes and/or buy lots of alcohol despite not working a good job or a job at all.

The study in the OP is also fatally flawed. "Only 32% of home owners were first-time buyers in 2016" doesn't mean anything. It could just be people are moving more often and therefore are no longer first time buyers.

Home ownership is also falling out of favor though with younger generations. Millennials increasingly want to live in urban mixed-use areas which tend to be more rentals, and not homes you own. Many millennials I know also don't want to buy because they don't want to be tied down to one area too long and want to be able to move around more freely.

This issue specifically revolves around Melbourne and Sydney...particularly Sydney. Housing prices there are astronomical mainly due to foreign investment buyers. His telling millennials to save their pennies to buy a house is arrogant.
The rental market in these cities is also being artificially inflated by investors who buy a house only to wait for it to increase in value before selling it. The house is never rented out to tenants. There is speculation that up to 1/4 of houses around Sydney may be vacant, and the issue is big enough for the federal government to implement a vacancy tax in this years federal budget.

 

[travisbickle]

There's definitely people out there with spending issues. To simply say "fuck the rich guy's opinion" isn't necessarily fair.

I think Avocado Toast was just being used as an example. I'm 24, and plenty of people my age buy "trendy" overpriced stuff like that, go on Europe trips, buy designer shades/clothes and/or buy lots of alcohol despite not working a good job or a job at all.

The study in the OP is also fatally flawed. "Only 32% of home owners were first-time buyers in 2016" doesn't mean anything. It could just be people are moving more often and therefore are no longer first time buyers.

Home ownership is also falling out of favor though with younger generations. Millennials increasingly want to live in urban mixed-use areas which tend to be more rentals, and not homes you own. Many millennials I know also don't want to buy because they don't want to be tied down to one area too long and want to be able to move around more freely.

Don't believe statistics guys they're fatally flawed, believe this poster's anecdotal evidence.

 

[Hyun Sai]

The most shocking thing for me is that youngsters eat avocados... Do they put avocados on pizza like pineapple too ???

 

[sixteen-bit]

 

[Amalthea]

Things that were supposed to ruin previous generations:

-Rock N' Roll
-Hippie Movement
-Drugs

The thing supposed to ruin this generation:

-Avocados

 

[xevis]

The reason people are saying his comments are dumb is because frivolous purchases are reason number 903 on the list of why millennials in Australia can't buy property. There are huge structural disadvantages built into the tax system that (along with foreign investment) make it exceedingly difficult to buy property in Sydney and Melbourne.

I agree with this but the critics have some valid points. One being that youth today are often unwilling to increase their one way commutes beyond half an hour and out of reach of trendy inner city areas. I don't know how true this observation is in general but it is a common refrain that I receive from friends who say they can't buy a place.

 

[charlequin]

I agree with this but the critics have some valid points. One being that youth today are often unwilling to increase their one way commutes beyond half an hour and out of reach of trendy inner city areas.

Long commutes are the single factor with the most direct link to lowered life satisfaction and happiness. Almost across the board, people with longer commutes are less happy than people with shorter ones. It's a pretty reasonable choice to stay as a renter rather than lock yourself in to a lifetime of unhappiness buying a far-off bedroom community house. (Also it's not as if there are cheap houses waiting for the picking in convenient commute spots from most cities.)

 

[hydrophilic attack]

This is an amazing bump

 

[Inferno313]

I agree with this but the critics have some valid points. One being that youth today are often unwilling to increase their one way commutes beyond half an hour and out of reach of trendy inner city areas. I don't know how true this observation is in general but it is a common refrain that I receive from friends who say they can't buy a place.

Heaven forbid people don't want a commute that taxes their physical and mental health.

 

[Ottaro]

Heaven forbid people don't want a commute that taxes their physical and mental health.

Yep. At a certain point peoples lives can simply become working and driving. Its not physically nor mentally healthy.

 

[Seth Enosh]

I agree with this but the critics have some valid points. One being that youth today are often unwilling to increase their one way commutes beyond half an hour and out of reach of trendy inner city areas. I don't know how true this observation is in general but it is a common refrain that I receive from friends who say they can't buy a place.

Long car commutes are terrible though for multiple reasons.

I'm not sure about the situation in other countries but in the USA we have under-invested in light rail/commuter rail and metro systems that can allow people to live outside of the city and commute without having to sit in a car for hours. At least on a train you can read or get some work done. I took a commuter rail to high school and was able to do my homework on the train ride, something you could never do in a car.

 

[Elaugaufein]

Long car commutes are terrible though for multiple reasons.

I'm not sure about the situation in other countries but in the USA we have under-invested in light rail/commuter rail and metro systems that can allow people to live outside of the city and commute without having to sit in a car for hours. At least on a train you can read or get some work done. I took a commuter rail to high school and was able to do my homework on the train ride, something you could never do in a car.

School (before Tertiary) is generally okay. Governments fund fairly comprehensive school buses in Australia and there's a remote education school over radio / phone / internet / small planes for major events for those who are really remote. Education access is something we take seriously.

It's once you hit Uni (to a lesser extent as living on Campus is generally an option since the cost is subsidised) and work that you run into issues. Primarily a lack of consistent coverage of public transport. There's way to many places you have to leave an hour for public transport for a 15 minute drive and heavily overloaded peak time traffic on main roads.

Our light rail is state government or capital city government. We actually ripped up a lot in the early 20th century when it seemed unnecessary (whooopps) and it's hard to build more because of the overloaded roads situation (convincing motorists there should be a tram line on the road they are spending an hour sitting on is harder than most governments will wear).

Heavy / long distance rail suffers from our population being very lopsidedly concentrated around our east coast capitals: ie a lot of rural areas only have a handful (if any) of passenger trains a day because they don't have enough demand to be sustainable.

 

[nabe_shogun]

What if I make my own mediocre avocado toast? Will I at least be able to buy a condo?


It was delicious though.

 

[Vimes]

The most shocking thing for me is that youngsters eat avocados... Do they put avocados on pizza like pineapple too ???

I do. Take leftover carne asada, use trader joe's salsa as a base, dry mozzarella on top (two cheeses if you're a dirty boy), cook it, and put avocado and cilantro on as it comes out of the oven. It's amazing.

 

[reckless]

I hate avocados and yet I'm not rich. Please help mr millionaire.

 

[hirokazu]

Such a excellent example. I can't believe how how much money we spend on loans to buy property. It really puts into perspective why people commute up to 2 hours a day for work to afford cheaper housing.

Here in the Washington DC area houses average for 500k as well, it's ridiculous.

The problem is that example isn't indicative of average house pricing in Sydney. The median price in Sydney is over AU$1m, or US$750,000.

 

[Unknown Soldier]

The problem is that example isn't indicative of average house pricing in Sydney. The median price in Sydney is over AU$1m, or US$750,000.

So, just like San Francisco, Los Angeles, and New York City?

 

[hirokazu]

Yeah, if every millenials had his gramps they can buy all the avocados they wanted

To be fair though, $34,000 isn't a huge amount and could be saved up after 2-4 years. So you could say he got a 2-4 year head start and the guy made it on his own. That said, touting his business acumen is a little disingenuous since that has very little to do with housing affordability.

So, just like San Francisco, Los Angeles, and New York City?

Your point being...?

 

[NandoGip]

To be fair though, $34,000 isn't a huge amount and could be saved up after 2-4 years. So you could say he got a 2-4 year head start and the guy made it on his own. That said, touting his business acumen is a little disingenuous since that has very little to do with housing affordability.


Your point being...?

Lol this guy thinks your average mid-20 to 30 year old has the capability to save $35k in possibly two years and definitely 4 years

edit for clarification: saving $8.5k to $17k per year is a pipedream for majority of millenials unless you literally live in squallor and survive off of seeds you grew yourself