Issue #13 ‘wolf’ has arrived, subscribe now to get your copy. Available July 31 in the UK and Australia; August…
John’s reaction was one of blushing shame: the kind that travels from your neck to your face to the tips of your ears, spreading like the crimson of a conquering country on a wartime map. I had walked into his office, in a Marxist political economy faculty, and caught him looking at a real estate website. He slammed the laptop shut. I laughed. Flustered, he told me to knock next time.
“Are you thinking of buying?” I asked, nodding at the computer. “No, no,” he said guiltily, “just dreaming.”
Australians have a habit of equating property with dreams. Owning your own home is ‘The Great Australian Dream,’ suburban mansions are called ‘dream homes’, and buying your first home is the moment when ‘dreams come true’.
Call me treasonous, but to me the great Australian dream has always seemed like more of a nightmare: mortgaged up to your eyeballs on a house you never get to enjoy because you’re too busy working to pay off the mortgage; living in the paranoid isolation of a cyclone-fenced McMansion with only the blinking idiocy of a plasma TV for company; and lazy Sundays smelling of barbecues and debt. Where is the sun-dappled reverie in taking out a crushing loan for the next thirty years? When did our dreams shrink to the size of a suburban home? People like John used to dream of social equality, now they dream of bricks, mortar and shiny appliances.
When I picture the Australian dream I imagine something akin to the eighth circle of Dante’s Inferno – the one where the sinners lie drowning in their own excrement.
Yet Australians remain irrationally and feverishly obsessed with real estate. Renovators have colonised our television screens squawking about ‘flipping’. Property speculators have conquered the front pages of our newspapers, as though real estate prices were more important than global politics. And buyers have invaded our dinner parties holding us captive to musings on the market.
We measure maturation through our first mortgage and we measure success through our first investment property. Renters are not only off the grid, they’re also infants. We come of age through getting into debt.
We like to think that home ownership is what makes us Strayans – that mortgages are hard-wired into our DNA. While Prime Minister, John Howard said that for us home ownership has been a ‘timeless dream’. But history suggests something quite different. Cultural theorist Fiona Allon has shown that according to the 1911 census we were (by a slim but pleasing majority) a nation of renters. Only around 49 per cent of the population owned a home, compared to around 70 per cent today. She argues that our imaginations shrivelled to the size of a fibro cottage when Prime Minister Robert Menzies took the national stage in the 1950s.
Our obsession with real estate goes hand in hand with cultural constipation and socially conservative politics. Under Menzies we became one of the world’s leaders in home ownership at the same time as we became suffocatingly insular and infinitely stupid. The White Australia Policy was pursued with vigour, cultural life died, intellectuals fled for foreign shores and women necked bottles of valium as they returned to the comfortable forced-labour camp of the home.
Much the same thing happened under John Howard. McMansions vomited out into lonely suburban blocks while Australia closed its national doors to refugees, fretted about immigration and replaced a robust welfare state with a very gendered idea of home and hearth. Fortress Australia was everywhere, says Allon, in the neurotic architecture of the suburbs as much as in our shameful policies towards anyone not white.
It’s tragic that economic prosperity spawns cultural poverty. The minute we have a chance to build solid public infrastructure, a welfare state, and a rich artistic life, we become a nation of mean-spirited renovators. As we embellish our private lives, we impoverish our public spaces. Our houses are larger and more Swedish than ever before. But we still don’t have a metro, there are suburban streets without footpaths and it’s hard to find a place to socialise where you aren’t also forced to consume.
Our obsession with renovation and real estate also has very real effects on the lives of the poor. Renovations mean that the price of property increases and the more expensive a house is, the harder it is for first homeowners and renters to buy. Rising house prices also create a kind of economic apartheid, in which the lower- and middle-classes are pushed to the outskirts of cities, to areas without public transport or basic amenities, while the wealthier minority pass down their harbour views and inner-city sanctuaries to their over-privileged children. Because when we dream of a home, it is not simply the bricks and mortar that we’re fantasising about. It’s also the quality of life that comes from a good location: schools within walking distance, cafés and being able to walk or cycle to work.
Newspaper stories document the frustrations of an entire generation being locked out of the property market, but even more depressing, to my mind, is why we should feel compelled to buy in the first place. In Germany, as journalist Eryk Bagshaw has shown, only 41 per cent of the population own a home and an OECD study found that 93 per cent of the country is happy about this. So what are they doing that we’re not?
Firstly, Germans give renters rights. In most states in Australia, tenancy leases are for between 6-12 months and if your landlord decides to sell in this time they can kick you out with one month’s notice. If you fall behind on your rent they are legally obliged to give you only two weeks’ notice. In Germany, says Bagshaw, a forty-year lease is quite common. In fact, most rental tenancy agreements are for an indefinite period of time. Their laws also favour tenants over landlords, which means that it’s almost impossible to evict a tenant. When someone is evicted, it usually makes the news.
Secondly, the German government doesn’t provide tax breaks or any financial incentives to invest in property. The market offers no significant returns to property owners, which means that there is no desire to ‘trade up’. Bagshaw quotes economist Jim Kemeny who says that there has been no housing boom in Germany in the post-war era and as a result the ratio of house price to income continues to fall. The contrast to Australia couldn’t be more stark, where we invest in houses not because humans need shelter and not because we want a place from which to build community, but because houses are a guaranteed way of getting rich. As a result of government policies like negative gearing, house prices are pushed to unaffordable levels. In fact, Australia has the third-highest house price to income ratio in the world.
Finally, part of what makes a house a home is your ability to change it – to knock down walls, renovate bathrooms or paint it whatever colour you want. Rental laws in Germany allow this. In Australia, you’re lucky if your lease permits you to hammer a nail into a wall to hang a picture. Renters live every day with a sense of impermanence, not to mention a dependence on the goodwill of the landlord.
Germany is not the only country to look to for a more enlightened approach to property. Under new laws in France, no new rental contract in the inner suburbs of Paris is permitted to charge more than 20 per cent per square metre above the neighbourhood’s median rent, which will be assessed annually by a ‘local rent observatory’. In Holland there is a similar rental review agency that you can appeal to if you think your rent is too high. They will assess your rent based on the median rent in the area and the quality of your house. If it’s too much then the landlord is forced to lower the rent and to reimburse you the excess money.
In the absence of having any viable alternatives, the Australian ‘dream’ of home ownership is really more like a death sentence. It’s not a choice. It’s coercion, born of the fact that, particularly in the major metropolitan cities, there is simply no stable, long-term alternative. And yet it’s something that most people in the lower- or middle-income brackets either can’t afford or struggle to afford.
Civilisation has arrived at a very dark point when people in the richest country in the world cannot afford to put a roof over their heads. The thing that troubles me, however, is that in spite of our constant lament that our rent is too high or that property is over-valued, we do nothing about it. We need to start acting collectively to place pressure on our governments to behave like most governments in Europe: restrain greed and protect low-income families from housing insecurity. These policies will not just have a material effect on the lives of the poor, but a widespread cultural effect on all of us: they would joyfully liberate us from the conversational tyranny of the housing market.