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A LANDLORD 2 CALL UR OWN!!! IS RENTING THE NEW BLACK?

Some of us r just happy 2 remain tenants 4 life & rather than owing a home to call our own, we’re just content with a landlord 2 call ours! More & more of us r renting, not particularly fussed @ skimping ‘n’ saving half r lives 2 sacrifice a lifestyle! By 2020 approx. 40% of Aussies will b permanent/long-term renters all due 2 a mixed bag of reasons – marriage breakups, renos & job relocations.

 

The question seems like a no-brainer: is renting better than owning? Invariably the answer is no but tweak the question and ask if renting is better than buying? Then the answer can be a tangle of yeah-but-no-but-yeah-but-maybe.

The great Australian dream has always been 2 own a house, or at least 2 start the process of buying 1, a journey that can take half a lifetime. 4 many young people 2day, however, that dream has become almost impossible.

Sydney is 1 of Australia’s least-affordable cities, where population continues 2 rise & land prices show little signs of softening. Reality is that these are solid pointers 2 the beginning of the end of the dream 4 many people.

So what? Does that mean the sky is falling? No, it simply means we are moving along the same path as some of the world’s most affluent countries, where more people rent than buy & don’t really care.

In Germany, which has about the same wealth per person as Australia, 67% of households r rented. Super-rich Switzerland has a similar figure. This compares with just 30% in Australia but r figure is climbing.

Dr Terry Burke, the professor of housing studies at Swinburne University, says home ownership is in slow & permanent decline.

“Governments might prattle on about building ownership but the policies they put in place r more about capturing votes,” he says.

“For example, they look @ reductions in stamp duty & increasing the 1st home owner’s grant, rather than dealing with the structural problems that have made ownership unaffordable.”

Psychologist Merryn Snare says r fixation with buying rather than renting is leading 2 social problems. “I think that people who can’t raise the money for a deposit may feel overwhelmed & helpless,” she says. “Poor self-image may result but there may also be a tendency 2 deflect their feelings via anger or blame on others — including the banks.”

Other people feel no social stigma about renting & certainly don’t feel they’re failures. Most r successful in their chosen fields & life in general. 4 most, renting is a temporary status. In fact, some have investment properties of their own.!

But, most r renting 4 a reason: marriage break-up, renovation of their principal home or job relocation. Some have sold their home in a buoyant market & r keeping an eye open for a downturn in prices.

“It’s the Australian dream 2 own a house. People like the security of ownership but as housing costs increase some people may have no choice but to rent.

Some of the benefits of renting include:

■ U can live in a location where u simply couldn’t afford 2 buy.

■ U can move into a zone 2 qualify 4 a sought-after school.

■ U can rent while the market is hot, then quickly move from ur rental property when prices stabilise & u find your dream house at a price u can afford.

■Rental prices are usually lower than mortgage repayments, freeing up funds 4 investments in other areas.

If there is going 2 b a shift away from the traditional notion of owning ur own home, there will need 2 b changes in the laws as well. Currently, they r not set up 2 provide the long-term tenure that people who wish 2 rent all their life may want.

This uncertainty is 1 of the pillars propping up the housing market. The private rental market lacks regulation in regard to affordability, rent-setting & security when compared with nations such as Germany.

It’s also important 2 recognise western European nations with a high proportion of tenants also have significant social housing systems & relatively small private rental markets. Here, that structure is reversed.

Many marketing campaigns have a strong influence on people aspiring to be home owners.

The marketing of 1st home packages exploit the very powerful cultural “norm” of ownership. Given the very strong preference 4 home purchase, the advertising tends 2 focus on all of the tangible and psychological benefits associated with housing, including social status & physical & financial security.

Psychologist Merryn Snare says many members of generations X & Y r not as concerned as their parents about home ownership.

“There is evidence these groups prefer 2 put money into other investments, rather than have the responsibility of property & gardens,” she says. “2 them, renting apartments in trendy or convenient locations seems attractive.”

However, she says, the belief remains that rent money is “dead” money. “& if the dream of owning a home on 1130 square metre block was what their parents aspired 2, then I would expect people who couldn’t achieve this r likely 2 feel like a failure — unless they thrive on being rebellious.”

Professor Burke says that historically, Australians have been attracted 2 home ownership as a “wrap-around housing tenure” that enables them 2 add on 2 the house, or wrap around it, the aspirational lifestyle that individualistic Australians value.

“The ownership of a detached house enables a household 2 extend upwards or outwards; 2 put in a swimming pool; 2 build a garage or carport for 1, 2 or more cars; 2 put in an outdoor entertainment area based around the bbq; 2 have a large garden & landscape it & spend Sunday afternoon @ Bunnings,” he says.

“Unless u own the dwelling & have the external space, u can’t wrap these things around the dwelling. What can a renter do by comparison?”

“By 2020, something like 40 per cent of Australians will b long-term or permanent renters, with many of them being children. We have 2 ensure they can live in housing with the same security and dignity as owners.”

Interesting huh? What do u think???

The Goss!
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A LANDLORD 2 CALL UR OWN!!! IS RENTING THE NEW BLACK?