Buyers Strike “Irresponsible”

Some commentators have described Prosper Australia’s Buyers Strike as “irresponsible” because it threatens to disrupt the orderly market in real estate.

“These opinions should be greeted with howls of derisive laughter,” Buyers Strike campaigner David Collyer said today. “A market is made up of many competing views. To give oxygen only to some is a recipe for disaster.”

“Hundreds of thousands of potential first home buyers have privately done their sums and find they don’t add up. Prosper is merely giving them a much-needed voice.

“Two secure jobs and a good deposit are no longer enough to buy a home. Buyers must make a life-long vow of poverty as well.

“It is irresponsible to expect such a sacrifice,” Collyer said.

“Do not underestimate their anger and frustration at being denied land ownership and its civic benefits.”

“These commentators are saying the only views entitled to attention are from the property spruikers – the professional industry mouthpieces. Their mantra is of land shortages due to government restrictions, spiralling demand, and that all property deserves a premium because Australians live on the coast.

“They glide over the fact FHBs are priced out of the market by a national hysteria to invest in property. Without FHBs, second home buyers cannot trade up. The whole juggernaut grids to a halt.

Meanwhile, of the 1.75 million Australian taxpayers with rental income, 1.3 million only have a single rental property. The vast majority are both middle-income earners and are negatively geared. They are diverting all rents and part of their personal income to meet costs and interest payments. These assets are illiquid, highly geared and undiversified. Their investment strategy only works when prices rise faster than the interest cost. See here.

“Negatively geared taxpayers guarantee price falls will be extreme when they occur: all will want to bail out at the same time. Further, banks will require equity injections or will forcibly sell up heavily mortgaged properties that go underwater, that are valued at less than the loans they support.

“The message in our Buyers Strike is clear and simple. If FHBs refuse to buy at current outrageous prices, the market will correct.

Collyer reiterated that Prosper is not calling the bursting of the Great Australian Land Bubble, merely pointing out that it is ‘imminent’. ENDS

 

14 Comments

  1. First Home Buyer24-03-2011

    Irresponsible for who? Those that own investment properties?

    There are a number of would be first home buyers that are priced out of the market, and this echos our voice.

  2. Fed up24-03-2011

    “Some commentators have described Prosper Australia’s Buyers Strike as “irresponsible” because it threatens to disrupt the orderly market in real estate.”

    An ‘orderly market’?? So corruption, market manipulation, supply consrtiction, govt handouts of taxpayers money, endless spruiking that borders on lies and deceit – is and ‘orderly market’? Turn it up why don’t ya!

  3. Jason24-03-2011

    Don’t spook the bulls. They only have 6 months for their super optimistic calls to come true otherwise the property market will resemble a falling knife.

  4. bye bye ponzi24-03-2011

    Buyers strike.
    Bit like watching a bunch of lemmings come to their senses just in time before they jump off the high cliff of debt servitude constructed by interest-chasing banksters.

  5. Daniel24-03-2011

    Power to the people! Power to the people right now!

  6. Peter N24-03-2011

    Frankly, anyone who is dumb enough to buy into an investment which is costing them part of their salary (because rent doesn’t cover it), and will only make them money if capital gains are to be had… they deserve to get their fingers burned. If someone is dumb enough to put their life savings on 32 at the roulette table, and they lose it, who would feel sorry for them? But making a similarly risky “investment” has to be treated with respect, and bailed out if it fails? GET REAL!

  7. Mahamed25-03-2011

    Spot on Prosper, and keep up this great effort ! The buyers strike is 100% supported by AustralianPropertyForum.com and our thread on the subject already gathered over 1,500 views in only a few days ! Read the thread below, theres a lot of support for this cause……

    http://australianpropertyforum.com/topic/8506527

    Plus the Get Up campaign to end neg gearing is supported by the Australian Property Forum too !

    Lets hope this makes a real difference to young Australians. Keep it up !

    Mahamed.
    AustralianPropertyForum.com

  8. John murray25-03-2011

    We need it writ large in legislation that houses are for housing people, not enriching them.

    I want a house, I don’t want an investment.

    Over the last couple of years, all I get from real estate agents is spruik that this property is ripe for duel occupancy, just knock down the shed and build another place out the back, and then subdivide and sell, and low and behold…. profit !!!!

    When real estate agents spruik development potential as the only thing a house has going for it, you know the market has reached top!

    I prefer a nation of shopkeepers to a nation of property developers any-day!

  9. Paul Meleng25-03-2011

    The use of taxpayers funds to “boost” one particular market product only for a select group is fundamentally immoral. What about people who have been wiped out for one reason or another, pay taxes, and want to buy a house and re-build their lives. Sorry, you cant have a $21,000 boost because you once owned a house 30 years ago. But we are happy to use your taxes to help someone else and to push it further out of your reach. Baaahhh. And as this blog and others say, we all know the Grants and boosts all just push up the prices, by even more than the amount of the grant.

    Strike !

  10. Stewart26-03-2011

    It’s not irresponsible – it’s just people being public about their view that they do not think a property is worth that much.

    I agree with them – no way i’m paying those prices, committing that much of my wage to that, for that period of time. Get stuffed – it’s not worth it; way past worth it, even.

    Stewart

  11. Jay30-03-2011

    The threat to young australians was the speculative buying of property forcing us to commit to years of masive debt at the hands of the banking elite and ruining the lives of those who believed in what was once a moral and intelligent thing, saving money. Housing is a necessity, to which we are now forced to take on large amounts of debt…An area largely unnoticed or cared about by those at the top.

  12. Matt C30-03-2011

    I am an expat, i live in the States in my mid 30’s. I would love to move back home to be around family and friends. However the reality is my wife & I can’t afford it. To have a $450K mortgage over your head just does not make sense, it is extremely upsetting.

    You know another thing to look at/investigate is are the banks telling the whole truth, how many times have they been caught out by short selling and quick flips. I called Sydney once my home now it is a distant vacation spot

  13. Gav30-03-2011

    Great idea!! Lets all club together and and watch these ridiculous property values fall to a level which all of us hardworking young australians can afford! Why should one generation reap the benefit of a property boom while others can’t even get a look in..all of us have the right to own a house and not be a slave to our mortgages..there has to be a lot more to life than that..so come on young ozzies lets beat these greedy spruikers and realestate scumbags, hold the picket line!!!

  14. Gavin R. Putland31-03-2011

    Irresponsible to warn about a looming crash? OK — here’s how to engineer a soft landing. It’s called a STAMP-DUTY STRIKE: http://is.gd/psd_strike .

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