Never mind the housing boom in Australia; here is another angle. Australia is on average building the biggest homes in the world.
According to CommSec chief economist Craig James, the reason is:
"Certainly it makes sense that Australia builds bigger homes than in other countries, given that population density is far smaller than in other parts of the world".
Actually that is too much of a generalisation; and a very inaccurate one. There are plenty of countries with adequate space; the US being a prime example. I would suggest a different motivation:
1. Australia has more Greeks than most countries, and they have a liking for Colosseum and other such grandiose architectural features that adhore the facade of monumental displays of egotistical pretense.
2. Australia has a great many mining millionaires who got rich publishing false drilling results or false quarterly reports; and then let's not forget they have friends besting them in other industries. That is why they are called 'besties'.
Australia might have the lowest population density, but most of that land is tied up in reserves for the sake of aborigines and fauna. In fact, Australia has among the most restrictive zoning regulation in the world - despite the paradox of vast lands - which go some way towards explaining the ridiculously high prices for land in the country. i.e. 500m2 some 100km north of Sydney will cost $US220,000; then add another $150,000 for the house. You'd have to wonder why coastline is so valued given the 14,000 odd beaches in the country, but we are all compelled by our need for services, if not our desire to live near water.
I frankly can't believe that the Chief Economist at Commonwealth Bank said that our houses are bigger because of our low population density. No Craig, its because local government will not allow us to subdivide our land. i.e. We need to protect the trees to preserve the green credentials of Sydney. But then listen further and you will hear more gaffs from Craig:
"Gen Y places less importance in home ownership than past generations, preferring to maximise life experiences".This is nonsense of course. Yes, apartments do have their advantages in terms of city proximity, easy of renting; but most Australians simply buy apartments because they can only afford the exorbitant $320-400K price tag for an apartment compared to $500-750K for a house & land. That is why many are moving 100kms to the Central or South Coast where they can still afford a house. This is pretty ignorant for a 'Chief economist' at a major bank. Aren't banks in the lending business? I guess he is in the securities department. But then aren't banks supposed to know something about the economy? Apparently credentials at Comsec don't include an education. But then I gathered that when I used to trade securities with them. Serious acts of incompetence cost me a great deal of money.
I guess the last time the size of Australian houses was so large was during the 1880s gold boom.
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Andrew Sheldon www.sheldonthinks.com
