12 April 2023

Let's stop selling the myth of 'self-made' success

| Zoya Patel
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avo on toast

This isn’t the reason young people can’t afford a house. Photo: Fudio.

We like to talk about self-sufficiency in Australia.

We respect those who ‘made it on their own’, who pulled themselves up by the bootstraps and came from nothing. We’re absolute suckers for a rags-to-riches narrative, and we like to assert that anyone can better their circumstances if they just work hard enough.

But when it comes to the most basic of dreams – owning your own home – it’s becoming less and less realistic for first-home buyers to enter the market without external help. So why do we keep pretending like it’s possible?

A friend recently sent me a screenshot of a house in the same complex as mine that’s for sale.

“We could be neighbours!” she wrote. “If only I had a spare $34 k.”

I wrote back immediately to remind her that not having a spare $34 k as a millennial renting in Canberra is not her fault and that the only way my partner and I could buy our house was with a hefty deposit supplied by my parents.

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My friend, like many others, struggles not to feel personally responsible for financial circumstances that are actually beyond her control. And sitting on the other side of the coin, I’m shocked by how significantly privileged we are financially by virtue of owning our house with the mortgage we have.

Let’s say I did scrounge together a 5 per cent deposit and managed to buy this house without external help. My actual mortgage would be about $200,000 more than it is currently. And if I hadn’t bought right when I did, in the window of time when the housing market was marginally more affordable before COVID drove prices up, my house would have cost almost double what we paid.

But because I got a 20 per cent deposit from my folks, because our place was $200,000 less than what it is now valued at, and because interest rates were incredibly low, we now pay almost half in our weekly mortgage of what weekly rent would be in the same complex.

So if I were renting right now and trying to save a house deposit, there’s no way I could save more than 5 per cent based on current house prices and realistically, that would take me several years. And now I have an asset worth significantly more than we owe, giving me a sense of financial security.

Barely anyone I know of my generation has bought a house without help. Whether that help is via a financial gift or by living at home for decades longer than previous generations and not having to pay rent during that time means they could save most of their income. Or, like some of my friends, by using their sizeable trust funds.

But because we don’t talk about this openly, and because society still sells this myth that anything is possible if we work hard enough, the insecurity of not being able to own a home is coupled with shame for many that they haven’t somehow been able to achieve what their networks seemingly have.

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I tell everyone that our house was purchased with the help of my parents because I don’t see the value in pretending it would have been possible otherwise. We also don’t live in what would be our first choice of houses – we were honestly just thrilled to be buying at all, and we were happy to settle for what was affordable within the price range that was opened up to us, compromising on privacy, a backyard and suburb.

But of course, we don’t care about those compromises because we are so, so grateful to own this place – which is sad because secure housing shouldn’t be such an unattainable dream.

Of course, there are some people my age who genuinely do achieve home ownership without help. To my knowledge, I haven’t met any, but I assume they forwent plenty of other experiences in favour of saving every penny to own a home. I don’t think it should have to be a case of giving up other joys in life to have such a fundamental resource like secure, affordable housing.

I know my friend will eventually be able to own her own home because we’re in the lucky cohort of people who work well-paid white-collar jobs and have partners bringing a second income. It’ll take time, but they will definitely get there. But for everyone who doesn’t have those initial privileges, the dream of home ownership might never come to fruition, and that’s not because they ‘didn’t try hard enough’.

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“I know my friend will eventually be able to own her own home because we’re in the lucky cohort of people who work well-paid white-collar jobs and have partners bringing a second income. “

That’s like saying I know my child will eventually get good grades at school if they apply themselves, study hard and avoid frivolous distractions? So do we expect someone who procrastinates, spends their days partying and playing video games to get good grades as well?

It sounds like the author would like a medal for making a life decision which everyone else does regularly based on their personal circumstances and those of the broader world at the time.

Gregg Heldon7:35 am 14 Apr 23

Almost three years ago, I was medically retired from work. We used my Super, which, after tax, was made available to me, to become debt free and to use as a deposit to buy a brand new home. And getting a mortgage on a Comcare pension, in your 50s, was tough in itself.
We had bought and sold houses before but had been renting the previous 9 years after selling our old house. An old fixer upper that was getting expensive so we thought “rent a couple of years while we find a block of land”. Then my mother in law got cancer and my Wife flew to England a few time to help care for her. That, and that price surge in the 2010s, meant that we had a shrinking deposit so decided to stay renting. We were lucky that we had a great landlord and nice little townhouse to rent.
Life happens. Not everything is straight forward or simple. We were and are lucky but not as lucky as some. We’ve struggled but others have struggled more. But my own journey makes me very aware that we need, as a nation, to do something about affordable housing and it needs to be done 3 years ago.

HiddenDragon9:27 pm 13 Apr 23

“But for everyone who doesn’t have those initial privileges, the dream of home ownership might never come to fruition, and that’s not because they ‘didn’t try hard enough’.”

It’s all OK, the same corporatist bloodsuckers who have created the current housing affordability shambles (and who are very happy to see distracting inter-generational and intra-middle class squabbles over this issue) have the perfect solution – “build to rent” – just don’t be unemployed and try not to think about what will happen if you go into retirement with nothing much more than the aged pension to live on.

devils_advocate12:15 pm 14 Apr 23

Aka “you will own nothing and be happy”

ACT Government is more responsible for the high costs for both rent and sales than any of your corporate bloodsuckers.

“ACT Government is more responsible for the high costs for both rent and sales …”

I know Barr has an overinflated opinion of himself, but I don’t imagine in his wildest dreams, he would have thought his policies would impact the whole nation.

The conservatives (and a sizeable portion of followers of other political ideologies) may well get their wish for Barr to be gone – for, on the strength of your amazing insight, Barr is probably going to head up the hill and join Katie as a Fed.

“I don’t think it should have to be a case of giving up other joys in life to have such a fundamental resource like secure, affordable housing.”

That is what people NEED to do. People who aren’t willing to do this, don’t want their own house badly enough. Unless you are born rich, have a very high paying job, or two people with good incomes to combine, that’s entitlement talking. Get over entitlement if you want to own your own home and come back to reality.

For years I didn’t go to movies, eat out (I grew most of my vegetables), etc. No hairdresser and certainly (LOL) no getting the fingernails done 🙄). I mostly rode a bike or took a bus to work. My small car stayed home in the garage on work days. I didn’t buy any new clothes (but mended) for five years, except for some cheap underwear. Didn’t spend money on alcohol or soft drinks, or mercy-me, bottle water. I rented out the spare bedrooms. I also bought the cheapest house on the whole Canberra market at the time. I was a realist; and didn’t expect to buy something similar to the standard of my parent’s house (ie, what my parents eventually had after many years. It wasn’t their first house; that was a flat in an iffy area). The same as my parents example, I started out with downmarket accommodation.
I bought my house in a different era, but it wasn’t easy, especially as I had a lower than average income, and it was a single income. Interest rates were a lot higher then. I quote from an article.

“Affording a home was a lot more difficult in the late 1980s than it is now, Centre for Independent Studies chief economist Peter Tulip said.

“Interest payments on a new home represent 38 per cent of the average wage now, in 1989 they constituted 64 per cent,” he said. “That’s interest payable on a new loan.””


“…I assume they forwent plenty of other experiences in favour of saving every penny to own a home. I don’t think it should have to be a case of giving up other joys in life to have such a fundamental resource like secure, affordable housing” – this is the very attitude that needs to be stamped out of people from an early age. Unfortunately our education system and socialist governments seem to reinforce a belief that people are born entitled to “fundamental resources” instead of having to work for them.

domenic, You have that wrong. That’s capitalism convincing people they must have it all. Spend, spend…

I disagree with your comment that attaining home ownership should not be at the expense of giving up other luxuries. I don’t know anyone who has bought a house (me included) that has not scrimped and saved, gone without and given up luxuries to buy their houses and pay the mortgages. I have been paying off mortgages for over 30 years since I bought my first house. I am very careful what I spend my money on and rarely splurge on luxuries such as holidays, going out for meals or have them home delivered. These are luxuries that many of today’s youth and hopeful home owners seem think are given rights without doing the hard yards of saving for a house.

GrumpyGrandpa2:50 pm 13 Apr 23

And this is where the author looses any degree of empathy she otherwise might have received.

“I don’t think it should have to be a case of giving up other joys in life to have such a fundamental resource like secure, affordable housing”.

I’m a Boomers. A generation that is ridiculed by younger people.

We were married at 20 & 19 and have raised 3 children. My wife has never had a full-time job. Neither of us went to University. Neither of us has ever had a job that paid close to the average “Canberra” income. We have never been overseas. We only have one car; it’s 23 years old. We don’t own any investment properties either.

We did it hard, gave up and continue to give up joys in life. Anyone who expects to not have to make sacrifices should take a real dose of reality.

devils_advocate4:30 pm 13 Apr 23

If you suffered in life and want others to suffer as you did because “you turned out fine” guess what – you did not in fact turn out fine.

While I don’t think it’s a walk in the park for potential home buyers to day, I think you are being a bit harsh on GG . When the author doesn’t think people might need to sacrifice some of the luxuries in order to buy a house (“giving up other joys in life”), I don’t think those of her ilk deserve a lot of sympathy – it’s almost by definition those who think they are entitled.

GrumpyGrandpa10:08 pm 14 Apr 23

Hello devils_advocate,

Those who put their lifestyles ahead of being financially responsible, may be able claim that they have won “at life”, but if that then results in them sponging off society, I wouldn’t say that’s turning out fine either.

devils_advocate10:00 am 15 Apr 23

Hello GrumpyGrandpa

Just to be clear, “sponging off society” included any scenario where people are receiving MORE in government benefits (Medicare, aged pension, aged care, concessions, public education for yourself or your children, low income tax offsets, public goods such as defence, etc etc) than they contribute in taxes.

So, for example, if you were a low income earner and therefore paying low rates of tax while receiving multiple cash or other government benefits, you were in fact “sponging off society”.

By contrast we don’t know the author’s situation or how much she contributes in taxes.

GrumpyGrandpa8:43 pm 16 Apr 23

With respect, I wasn’t specifically speaking about the author nor those to whom life has dealt an unfortunate hand. To people in hard circumstances, society has an obligation to support them. I’m wasn’t even talking about lower income earners.

I was referring to those people, on average or better incomes, who spend like there is no tomorrow, then cry poor. The sort that can “afford” overseas holidays, but complain about public hospital waiting lists, where they had the capacity to pay for private insurance, the sort that milks the system by living the high life and blowing their Super, knowing they can fall back on the Old Age Pension.

I think we all know people like this. I certainly do. The people who thinks others should pay for them and their lifestyles.

“…the most basic of dreams – owning your own home”…..,that is interesting how youngsters’ dreams have changed over the past few decades😂

I’m now 48, by the time I was 42 I owned my own 4 bedroom, two bathroom, double garage home. I’ve done it all on my own with no help from anyone and I’m a single parent as well. I’m now working on the second house so I have something to retire on. How did I do it? My grandmother told me 2 things: firstly look after the cents and the dollars take care of themselves and secondly you can do anything you put your mind to. So true.

devils_advocate2:20 pm 13 Apr 23

So just the one property then? I’m in my early 40’s and own multiple properties. And when I say I own them, I mean I actually own them, not the bank. The ratio of income to house prices was much more favourable when you were young, and has been further improved by real wage growth, which the current generation has not seen.

For me it was a misfortune that helped me get into the property market – I was retrenched (not my choice) and received a lump sum pay out. When I managed to get another job (took a bit of time & I had to eat into that lump sum) I still had enough for a deposit. If I had to save that deposit, it would have taken me years.

“I don’t think it should have to be a case of giving up other joys in life to have such a fundamental resource like secure, affordable housing”
And that’s the attitude that is probably at the core of home ownership struggles for people in your circle, Zoya.
While I concede that we baby boomers didn’t have to spend as much of our income on housing as people do today, one thing that is a major difference, is that we went without the discretionary luxuries in order to save so we could purchase our homes.
Perhaps instead of blaming external factors a bit of introspection is needed to determine how much income they could save if they didn’t demand such entitlement

Bob the impala11:49 am 13 Apr 23

I recall that I afforded more luxuries than my parents before buying a house, and with no help from them. It is incontrovertible that houses have become relatively more expensive over time, less affordable since the early 1980s. Despite your concession about ever-expanding house sizes/features as a factor, I think you are being a little unfair on those losing from these changes.

@Bob the impala
Hi, Bob
I’m not denying that house ownership is more difficult in today’s economic climate (both from affordability and cost of living pressures). However, I do have a problem with Zoya’s stance on making, well actually not making, any short-term sacrifices for long-term gain – i.e. “I don’t think it should have to be a case of giving up other joys in life …”

So many things wrong with this article that I don’t know where to start. So I won’t, I’ll just present another anecdote. Five of my nephews and their partners have recently bought houses. None of them “work well-paid white-collar jobs,” they are all tradies. And at least four of them got no assistance from their parents.

devils_advocate9:49 am 13 Apr 23

Tradies do extremely well for themselves. In my view, this is because of a number of reasons:
-generally enter the workforce much sooner
-have no HECS or education debt
-have much more opportunities for legal tax minimisation compared to PAYG income earners (even “white collar” high income earners)
-often can work with their other trade mates to build houses without the builder margin especially if they’ve got their builders license

So yeah I’d you followed the typical Canberra path of degree/grad job/career at 26+ perhaps your life choices weren’t on point if buying a home was your priority.

My congrats to your nephews, if I had my time over it’s definitely something I’d consider seriously.

Bob the impala11:55 am 13 Apr 23

Important points about the factors helping tradies and builders into housing sooner. The capital asset is then a factor in longer term wealth. A professional needs time to gain advantage.

“have much more opportunities for legal tax minimisation compared to PAYG income earners (even “white collar” high income earners)”
I’d be interested to know what you mean by this.

If a tradie claims the cost of purchasing tools (or other work related costs) as a tax deduction against their business or tradie income – that’s a ‘partial rebate’ on the costs they have incurred in generating that income. Remember, the tradie is still out of pocket for the rest of the cost of the item (i.e. the portion above their marginal rate).

Surely you are not comparing this to the ‘tax minimalisation’ schemes such as negative gearing, which allow investors to offset losses on the investment (which is an asset) against a different and totally unrelated income?

devils_advocate2:17 pm 13 Apr 23

@Just Saying no that’s not what I meant at all.

Firstly, negative gearing in and of itself is not particularly sensible. Incurring a revenue loss only makes sense if you think you’ll get a large capital gain, which is speculation.

The benefits I am talking about include e.g. deducting in full the operating costs of the “work vehicle” including fuel. PAYG earners doing novated leases doesn’t come close.

Other benefits are more to do with running a business. So for example warehousing profits at a company tax rate of 30 per cent until it’s a convenient time to pay yourself a salary. Or income splitting with your spouse to “do the accounts”.

There are heaps of other examples I could go into, which actually make financial sense compared with negative gearing which doesn’t make much sense.

OK – thanks for clarifying.
Is ‘deducting in full the operating costs of the “work vehicle” including fuel’ something tradies can do? Or is there some requirement to apportion (which can obvioulsy be rorted) private/work use or an FBT assessment? If not, there should be – otherwise absolutely agree is an unfair advantage.

devils_advocate11:27 pm 13 Apr 23

If the vehicle is of a type that is required for their work (eg hilux Ute) then from what I understand they can claim all travel from home to job sites etc (by contrast PAYG earners can only claim travel between places of work)

Also many operating costs of a vehicle (rego, insurance) are fixed so even a pro-rata deduction would be a massive benefit

Also on a number of occasions the government has offered instant write offs for business expenditures which were often used to get an instant 100% deduction on the purchase price of the vehicle (rather than depreciated over several years)

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