Comments on: Should graduates get a special first home buyer grant?

By: First Home Buyers Help

First Home Buyers Help — Thu, 03 Apr 2008 03:43:08 +0000

Having just completed a degree and having just bought my first home, I don’t believe a ’special’ home owners grant should be given to graduates. The home owners grant should be kept consistent for everybody regardless of there academic standing. Yes, I (and others) spent years studying but that was our choice and that should not entitle us to more money to spend on a home - Simply, get a job and save more money…

By: First Home Buyer

First Home Buyer — Thu, 14 Feb 2008 05:49:57 +0000

Although interest rates rising is potentially only a temporary affordability problem, young potential home owners are still faced with the problem of a real estate market which (according to experts) doubles in value every 7 to 10 years.

When today’s 18 year-olds are 28 and looking for their first home, by this measure you could expect median house prices to be double what they are today…

In Sydney, you could be looking at $1m+ (with current median house prices in Sydney being around $500,000 right now)

It leaves me wondering - where will the next generation build their wealth? Will it be in the share market? Will they need to wait (like vultures) until the baby boomers start kicking the bucket? Or will there be some unforeseen event which will level house prices?

I guess time will tell.

John.

By: jc

jc — Tue, 21 Aug 2007 14:41:27 +0000

captian

Something is being done. Prices are falling, so i suggest you move to those areas that are fallng the most and live the American dream. In some places they are down 35%! Go!

By: CaptAmerica1968

CaptAmerica1968 — Tue, 21 Aug 2007 13:08:47 +0000

The reality is that life for non baby boomers in the USA is much harder than it has ever been. My student loans are only 2 years salary but coupled with the highest cost in housing in America ever the burden is crushing. Personally I think that individuals and especially Corporations that buy single family homes just to rent them out at inflated prices are to blame for our current housing woes. America is quickly becoming a country where if you do not already own a home you never will. Salaries and wages are not going up with the cost of housing for generation X. Something has to be done to correct the housing/wage gap.

By: Brendan Halfweeg

Brendan Halfweeg — Thu, 16 Aug 2007 08:10:25 +0000

$100,000 of (non-means tested) debt probably sharpens the mind a bit more than a HECS debt that you don’t have to pay back until your income reaches a certain level (or ever have to pay back if you leave the country!).

By: David Rubie

David Rubie — Thu, 16 Aug 2007 06:35:33 +0000

Laszlo wrote:

When it’s not your money on the line, the incentive to succeed is of course dulled.

When betting on a horse race, this is most likely true. When studying to get a better job than you might have gotten without studying, I doubt it would hold. You’re not only betting someone elses money, you’re betting your own future. It would be hard to believe that a student would place little value on their own future (although some obviously do, the majority would not).

By: Ross

Ross — Wed, 15 Aug 2007 15:35:27 +0000

Andrew’s argument is fine, as far as it goes. It amount to saying “Sure, recent graduates lag behind a bit nowadays for a while but they will still make more money in future so there is no reason for helping them out”. That’s fine (if true - and most claims like that are based on historical data not forward prediction) but when the pendulum swings the other way, and the graduates are making obscene amounts of money while the non-degree qualified workers languish - all the time watching the value of their only major asset, their house, erode in relative terms - can we be confident that the non-degree qualified members of society wont increase taxes to keep their “lead” over us graduates? Of course not. How can a recent graduate who has witnessed the hypocrisy of today’s baby boomer leaders have any faith whatsoever that in 20 years time when it is our turn (finally after 15 to 20 years of waiting) to profit on our investment in education that it wont be stolen away from us by our peers - who by then must surely have become used to the smug feeling that fills their hearts when they look at the “geeks” who they have been financially victorious over for 20 years.

As good a definition of a recent graduate as anything is “A person who has learned that society rewards shortsighted mob driven speculation far more than long term investment in real skills”.

By: Damien Eldridge

Damien Eldridge — Mon, 05 Feb 2007 16:23:52 +0000

Laszlo, why do say that most Arts degrees are meaningless? In what sense are they worse than Science degrees or Law degrees or Economics degrees or Commerce degrees or Business degrees or Engineering degrees?

By: Laszlo

Laszlo — Mon, 05 Feb 2007 01:35:47 +0000

I think I might have been slightly misinterpreted. I don’t think the incomes of graduates should be supported (personally the only income support I’d support is a negative income tax). The most pernicious problem with overestimating the return on higher education is that too many students are churned through meaningless government-subsidised degrees (most Arts degrees for instance) because there is a social perception that university is good for them. This costs them and the taxpayers who fund their study. Of course the Labor party crying poor for so called Generation HECS has worn thin and students should take more responsibility for the costs of their education. But that shouldn’t mask the fact that our higher education system is doing a disservice to thousands of students while claiming to do them great favours.

By: Andrew Norton

Andrew Norton — Mon, 05 Feb 2007 01:18:20 +0000

Laszlo - I have seen (but cannot recall the results of) some research on the earnings of US college drop outs, but nothing here. Here, however, the risk is taken by taxpayers as well, as people who earn less than $38,000 a year pay nothing for their education, though they still have the opportunity cost of however long they spent studying.

There is substantial dispersion of earnings among graduates; indeed I think I am one of the few in Australia pointing out that many graduates are not in jobs requiring university qualifications. But (with some definitional caveats) 80% of graduates are in jobs where we could expect them to earn a premium, so as a group they are hardly a top income support priority.