Aussie politicians’ $300m property portfolio

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By Lindsay David , Paul Egan & Philip Soos, cross-posted from the Australia: Boom to Bust Blog

“With more and more Australians finding it difficult to break into home ownership, adopting the Canadian scheme would make a difference to thousands of Australians each year,” Senator Xenaphon said:

“As HomeStart Finance said this week, there’s something strange about being able to access your super fund if you are about to default on your housing loan, but you can’t access it to put a deposit on a home in the first place,” he said.

Australia is in the midst of a chronic housing affordability crisis. Housing price inflation has outstripped both rents and household incomes for over a decade, leading to a residential property market considered unaffordable both historically and internationally. Yet, instead of helping to resolve the crisis, Australia’s political class is apparently determined to maintain world-beating prices with poorly but purposefully designed policies to maximise prices.

The public should ask “Are the property holdings of our federal politicians negatively influencing policy and causing them to ignore evidence?” The parliamentary register of members’ interests may help to answer this question, allowing for a summary report of real estate holdings for each Australian federal politician (which may be jointly owned with their spouse).

It is evident that politicians are heavily invested in the property game, with the 226 members in both houses of parliament with an ownership stake in a total of 563 properties – an average of 2.5 properties per member, conservatively estimated at around $300 million (563 multiplied by the median dwelling price of $530,000 as of July 2014).

The real total is probably higher considering well-off politicians are likely to purchase real estate in prime suburban and coastal areas above the median (and not all property holdings are residential such as farmland and commercial properties). Property investment is popular across the political spectrum and is a common thread binding the normally divided and bickering politicians together.

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Australia’s federal political class own an enormous property portfolio, with only 13 of the 226 members (6 per cent) not holding any real estate. In the Senate, 76 members own a total of 202 properties – 2.7 properties per Senator – estimated to be worth around $107 million.

Further, 91 per cent of all Senators own real estate (57 per cent investment/commercial property/vacant land, 41 per cent owner-occupied and 2 per cent recreational), 75 per cent have a mortgage, and the top ten control a colossal 95 properties.

Senator Xenophon maintains an impressive portfolio of eight investment properties, along with Senator Barry O’Sullivan from the National Party who owns an incredible fifty properties (see Table 2). The high concentration of landed gentry in the Senate acts as a vested interest to pass policies which inflates housing (land) prices.

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The 150 members in the House of Representatives also have substantial property interests. In total, they own 361 properties – 2.41 properties per member – estimated to be worth around $191 million.

Moreover, 95 per cent of all Representatives own real estate (54 per cent investment/commercial property/vacant land, 43 per cent owner-occupied and 3 per cent recreational), 86 per cent have a mortgage, and the top ten own an astonishing 92 properties. Double-digit property holdings are maintained by David Gillespie (NP, 18 properties), Clive Palmer (PUP, 13 properties), Natasha Griggs (CLP, 12 properties) and Karen Andrews (LIB, 10 properties) (see Table 2).

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The trends in the data suggest a sizeable majority of federal politicians have a vested interest in maintaining high housing prices, particularly since most have mortgages over their own investments. A fall in housing prices may cause many politicians to fall into negative equity, providing a strong incentive for politicians to enact legislation which has helped fuel a housing bubble, enriching owners.

When the top twenty members of the landed gentry in federal parliament own 191 properties, it is difficult to believe that politicians will address the real causes of housing unaffordability, despite the recommendations from government reports.

If federal senators like Xenophon are looking for solutions, the focus should be on negative gearing, capital gains tax concessions and exemptions, liberalised SMSF and foreign property investment, first home owner grants and boosts, deregulated bank lending, land-banking, town planning, local infrastructure and development levies and the absence of a uniform land value tax.

The property-rich Senate and House of Representatives cannot be trusted to act in good faith on matters concerning real estate. Aversion to evidence-based housing policy has a long and tortured history, owing to federal politicians’ interest in maintaining the value of their collective real estate bounty, and also fearing a voter backlash following any substantive reforms that reduces prices, let alone the corrosive lobbying (legalised bribery) by the FIRE sector.

Politicians regularly demonstrate flagrant ignorance of policies which lead to more affordable housing, having consistently implemented flawed reforms that actually increase prices. Negligence and indifference has become par for the political course, suggesting the direction of housing policy must be freed from the vested interests of an unrepresentative parliament.

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Comments

    • On the surface it does seem contradictory – especially those comments made by Xenaphon. But many of these guys are self-made individuals and it is possible that small numbers of wealthy individuals could be skewing the overall averages. In either case, I personally would have thought it necessary to attract those types to parliament. As far as I know, most of them have not inherited their wealth like Gina, Murdoch’s or Packers.

      In the Roman senate, there was a long tradition of successful people obligated to do public service – to give to the state so to speak. A similar trend is also starting to occur in China – although those trends could be used/perverted for self-serving interests I guess.

      Couple of other question I would ask include: (a) once you strip out certain wealthy individuals – what the house ownership average would be then? (b) Furthermore, are those ownership averages boosted by the number of parliamentarians who actually have flats/units in Canberra that they reside in during parliamentary sittings?

      In either case – great post. Need more of this stuff…

      • Yeah in the Roman Senate Senators would lead the army into battle, seen anything like that around here?

      • Well, they didn’t have negative gearing , offshore borrowings, collateralised debt obligations and other innovations of the FIRE sector to hasten their demise

      • It’s not about how much property or money they have, we need good successful people in government. It’s all about conflicted interests at the policy coal face. The question is will these people act in self interest or the national interest?. We have written off a generation of kids to ever own property unless they get major help from parents. Where are the solutions? Xenaphon solution is idiotic and self serving, one of the few politicians I respected, how wrong I was.

      • “It has been a political constant of history since antiquity that creditor interests opposed both popular democracy and royal power able to limit the financial conquest of society – a conquest aimed at attaching interest-bearing debt claims for payment on as much of the economic surplus as possible

        “Among Rome’s leading historians, Livy, Plutarch and Diodorus blamed the fall of the Republic on creditor intransigence in waging the century-long Social War marked by political murder from 133 to 29 BC. Populist leaders sought to gain a following by advocating debt cancellations (e.g., the Catiline conspiracy in 63-62 BC). They were killed. By the second century AD about a quarter of the population was reduced to bondage. By the fifth century Rome’s economy collapsed, stripped of money. Subsistence life reverted to the countryside as a Dark Age descended.”

        http://michael-hudson.com/2011/12/democracy-and-debt/

        Rome permitted usury under 12% p.a.

      • Xenophon did not even own a primary residence. This person is claiming full negative gearing on all 8 properties. Is there any scenario where he would let house prices decline?

      • O8 – Rome and its ideals were modified and sustained by its Eastern capital and strengthened by its adaptation of Christianity – which then reconquered the West. Ironically those who actually conquered western part of the Empire adopted those attitudes for themselves. And here we are today.

        More than anything, Rome was a victim of its own success; decadence and the accumulation of wealth and pleasure replaced the original prized Roman virtues of stoicism, hardship and self-sacrifice. In either case – their decline was gradual for <200 years, and for the most part, they partied like it was 1999 until the Germanic Huns rode through the gates.

      • As far as I know, most of them have not inherited their wealth like Gina, Murdoch’s or Packers.

        If you bought property when it cost 1/4 (or less) as much as it does today in real terms, you have “inherited” wealth just as much as someone who was born into it.

        The people you want to attract into parliament are those who are prepared to consider the big picture, long-term future goals and put the needs of others before their own. Generally not attributes you find amongst the rich (especially not the aspiring rich).

      • Bullshit!! Research is not correct

        More than anything, Rome was a victim of its own success; decadence and the accumulation of wealth and pleasure replaced the original prized Roman virtues of stoicism, hardship and self-sacrifice. In either case –

        Wrong. The inability to give autonomy to the foreigners who they pressed into military service did them in. And why did this happen, anyone?? Because of rent seeker intransigence.

      • I kind of thought that the lack of actual industry in the Roman Empire was at least a factor – from at least Julius Caesar onward they were effectively a military ponzi that collapsed when they ran out of new entrant client states to conquer. De facto plunder made up a good proportion of legionaries’ wages, which eventually made recruitment and retention harder when soft juicy military targets began to run dry.

        wrt to the senate and the cursus honorum – very hard to separate political success and other kinds of success. More likely that success political and otherwise was a reward for favours rendered to the right people at some earlier juncture. Chinese system from the outside at least does resemble Roman republican patronage system.

      • Researchtime is fundamentally correct in saying that “decadence and the accumulation of wealth and pleasure replaced the original prized Roman virtues of stoicism, hardship and self-sacrifice”. Here’s a doco well worth your time —

        8:00 – Common features of every Age of Decadence

        “An undisciplined, over-extended military. The conspicuous display of wealth. A massive disparity between rich and poor. A desire to live off a bloated State. And an obsession with sex. But perhaps the most notorious trait of all is the debasement of the currency.

        10:00 – Sports stars paid like Roman charioteers

        “Just as our sports stars today earn vast sums, so too did Roman charioteers. In the 2nd century, one by the name of Gaius Apucleius Diocles amassed a fortune of 35 million sesterces in prize money, equivalent to several billion dollars today.

        11:00 – Chefs disproportionately hallowed as empires decline

        “Strangely perhaps, there’s another profession that is disproportionately hallowed as an empire declines. The Romans, the Ottomans, and the Spanish all made celebrities of their chefs.

        http://www.youtube.com/watch?v=5fbvquHSPJU

        Sound familiar?

        All the other features of the decline of the Roman empire pointed to were indeed that … features.

        Rt is right about fundamentals.

      • Sound familiar?

        Like many other examples in that video, there is a dramatic lack of evidence supporting the implicit argument that these are the only times in history during which these things happen.

        Indeed, as I recall, the whole thing is very long on assertions, and very short on evidence.

        I would like to know which periods in time can be considered noble, virtuous and humble, to test the hypothesis that they did not have highly paid celebrities and large wealth gaps.

      • Straw man.

        The accusation of “decadence”, per the quote you gave, hinges off the presence of those things (amongst others). They are explicitly presented as evidence of “decadence” – required conditions, one is led to conclude – thus rather strongly implying that they only come into existence during “Ages of Decadence”.

        However, no attempt to demonstrate that these things did not exist in times not considered “decadent” is made. Presumably since, if they did, an argument relying on them as key indicators of an “Age of Decadence” would look rather silly.

        Nor, most importantly, is are any real dates for these “Ages of Decadence” provided, giving the viewer no ability whatsoever to evaluate and test the claims being made against other time periods.

        Accusing me of a “straw man” after posting that video – full to the brim of just about every logical fallacy you care to think of, and mightily lacking in actual comparative analysis and evidence – as some form of authority, is laughable.

      • @Stat So what? They had Syria and Egypt and Greece and Britannia and Gaul producing more than they could possibly consume — that went on for centuries w/o any further conquest, pretty much from Marcus Aurelius on down.

        That’s my issue with what @Research was saying, the decadence and sloth among the Senatorial and Eqquine classes went for centuries!

        But they kept refusing to make land available for retired veterans and their families because the Senators and Emperors were making too much debased coin by renting the existing and ever more expensive dwellings. Finally the Huns had enough, sacked Rome and formed Hungary to thumb their noses at them.

        That’s how Rome was destroyed, the decline is meaningless in this context.

        And what the #### Christianity’s rise among the politically naive Franks has to do with anything is beyond me.

      • Nearly two millennia on and we still can’t agree on what caused the fall of Rome and how to prevent it again.

        What hope do we have today, I’ll tell you, nuthin… lol

      • Two words “circuses” and “bread”. What I have intimated above is factually correct. Rome reached its zenith under Augustus and then went into perpetual decline. Un-noticable at first, but gradually building speed.

        I won’t return some commentariat sentiments, suffice to all the facts in context do speak for themselves – a summary and a frank discussion regarding the state of current Western Civilisation (http://www.vanityfair.com/politics/features/2006/10/empire200610) is worth a read if you have time. Maybe a bit long for some.

      • @RT,

        The Roman empire reached its zenith under Trajan.

        Cicero was whingeing about decadence long before Augustus.

        The Roman Empire fell because it fell – the wonder is not that fell or why, but that it endured for 1200 years.

        Stoicism amongst Romans reached its zenith under Marcus Aurelius, who was after Trajan.

        There was no down hill run, just a series of ups and downs until they couldn’t get up again. Marius was before Augustus and Caligula and Nero were before Trajan and Marcus Aurelius.

      • No dammit it was the Huns how many times do I have to tell you!!

        LOL, this thread has covered everything from the decline of Rome to MSM softly spruiking a story that’s crying out for investigative journalism. on its way to 300 comments. Now for throw in some something about Thermopylae.

    • +1! For those waiting for the bubble to burst, absorb all the above info and keep waiting…

      • Shines an extra light on why the politico-housing complex is loudly throwing spurious arguments into the public domain, and adds to the view they will throw anything – future generations, Australia’s economic future, housing affordability, absolutely anything – into the defence of their property portfolio.

        It is time for a new political party on this issue alone.

      • We need a revolution to cleanse Australia of these treasonous parasites. Could they get any fucking worse? Tricking a clueless electorate to not only vote for them but to hand more of their money to boost the wealth of politicians.

      • That’s right Gunna the sheer determination of the politico-housing complex to prop this up cannot be underestimated, and certainly ties into the horrific future eating policies of the political classes.

        There is no level of sell out of the Australian people that is off the table.

      • @ gunnamatta, The table shows that the Greens, often cast in with the Lib/Lab’s as property shonks at MB, do not own investment props.Neither are they appearing before ICAC.
        What need for a new political party?

      • @bolstrood. Their damage to Australia is probably ten fold than high house prices. They are top shelf morons never ever to be taken seriously. Most people know that. Thank god.

        If ever they come up with an environmental policy be sure to let me know because I’m looking for a party to vote for that does.

      • @ gunnamatta, The table shows that the Greens, often cast in with the Lib/Lab’s as property shonks at MB, do not own investment props.Neither are they appearing before ICAC.

        There must be some error in the data. We are constantly told here how the Greens support UGBs and the like purely to pump up their inner-city investment portfolios.

      • “most people know that.”

        Yeah, most Australians also unquestioningly accept that housing is a good investment!

      • If ever they come up with an environmental policy be sure to let me know because I’m looking for a party to vote for that does.

        When your idea of environmental policy has matured past culling humanity, maybe they’ll be interested in your vote.

      • DrS, you are confusing the nuffnuff’s that run on the platform with the voting block.

        Most of the people I know who vote Green don’t own any property at all.

    • Vested interest in full display.

      They will protect their assets with reckless policies. If these measures lead to a disaster, they can safely claim that they could not have seen it coming. After all, there is no shortage of spruikers’ bullish publications / narrative to cite, especially from reputable sources such as the RBA.

      They can then grill a few of these in public hearings as scapegoats, while posing as a part of innocent victims, and then move on.

      A few months later, once the public forget about the said hearing and grilling, they can quietly offer pardon to the scapegoats.

      Back to square 1 and repeat.

      Let me know if things did not unfold in a way as I had predicted. I can find an explanation for everything!

    • “Fuck me.”

      There is very little else one can say except that I think we already have been!!!!!!! I’d probably also add a few other traditional accompnaying words
      ” F..k me bloody dead!”

    • Same as in 1880s boom. Members of state governments (esp Victoria) got paid bugger all and usually got in by being wealthy…which meant owning land. In that episode, they all colluded to blow the biggest bubble in Australia’s history. Self interested wankers just like today.

      Don’t expect reform to come from these guys. It will be thrust upon us by the turn in the global economic cycle in the next year or two. Liquidity will dry up and foreigners will re-price risk. It’s the same risk as always for Aust…a capital importer subject to the whims of global confidence.

    • Has MB conaidered ooding mainstream media with thos article to bring awareness of the situation? Send it to Steve Price in radio, ABC, SBS, Channel 7,10,9 etc, Alan Jones, Charloe Pickering The Project etc etc We need to get this information out there!

    • “and also fearing a voter backlash following any substantive reforms that reduces prices, let alone the corrosive lobbying (legalised bribery) by the FIRE sector.”

      This statement alone is why they refuse to act. All the other reasons are just speculation.

      • Yep! Any real reform will crash this damned thing and whoever tries the reform will get the blame. Better to take the salary and try to get out before TSHTF

      • The (majority foreign-owned) banks own our political system —

        “An ALP funding horror

        Robert Gottliebsen

        If an election is held in the next few months, Australian banks will play a big role in the outcome. And unless there is a dramatic change in the fortunes of the parties, the banks will still be key players if (as is likely) the next election is two years away.

        Australia has rarely seen such a banking/election event in its history and it certainly did not occur in recent elections. The looming role of the banks could force the ALP into a pre-election leadership change and in extreme situations force it to modify its carbon tax.

        To understand the pivotal role of Australian banks in the funding of political parties requires a deep knowledge of how the system works.

        For the most part, in the vicinity of three quarters of a major party’s funding in most elections comes from the public purse. The ‘public purse’ amounts are allocated to parties after the election in accordance with the proportion of the votes that are achieved.

        But there is no forward allocation of money. The distribution of ‘public purse’ money is strictly governed by the proportion of the votes actually achieved.

        ALP organisers are not looking forward to meeting with their bankers as the election nears. They are deeply apprehensive that as a result of current opinion polls, their bankers will slash the amount of election funding available to the ALP and lock it into a low vote.

        Conversely, Liberal and National Party organisers believe that as a result of their opinion polling they will receive a huge increase in support from their bankers to fund unprecedented amounts of advertising and promotion.

        If, theoretically, an election was to be held in a few months’ time, ALP organisers would go to their bankers and negotiate to borrow the money required to fund the campaign expecting to pay it back when they receive their ‘public purse’ money after the election.”

        http://www.businessspectator.com.au/bs.nsf/Article/Liberal-Labor-polls-banks-funding-unions-election–pd20110721-JXTSN?OpenDocument&emcontent_Gottliebsen

      • An external shock is the only thing that will stop this monster. I just hope we are in a position to capitalise on the shock with TRUE reform.

        Unfortunately, I don’t see why this policy won’t pass. The banks/re industry own this country. The only significant lobby group I can think of to block this is the superannuation sector itself. Surely they won’t want funds withdrawn from their investment funds to buy property… Less ticket clipping!

      • Correct OP8, the public just does not understand, I remember explaining this very article to my dad (he reads the courier/australian….shutter… haha), he thought I was being cynical. I then mentioned the concept “don’t bite the hand that feeds you”, the light bulb went on…

        Our political parties are slaves of the banks.

    • Thanks for the offer H I’ll be around after seven with the lube if want to dig out your favourite ballgag lol

  1. Brilliant UE, best one yet. Talk about Conflict of Interest.
    An analysis Exocet into the mid-ship of the brigands who are gaming the system.
    Down with these political dills – vote them out.

    • To vote in whom? To bend and idiom “Those who can, do. Those who can’t go into politics…”

      • Let’s see hockey sell his budget now we know he owns four investment props and one primary residence, then proceeded to cut benefits to lower income Aussies whilst preserving negative gearing. I smell a lynching.

    • Dimethyltryptamine

      “Down with these political dills – vote them out.”

      Agree, but who will replace them, more of the same?

  2. The comparisons to Canada’s system are cherry picking and half truths being spruiked by the property lobby. Buyers are able to borrow money out of their retirement fund for a period of 15 years during which it must be repaid or it becomes fully taxable income. Of course the real kicker is the Canadian system is NOT mandatory like super. There is no compulsory employer contribution (many employers have optional payment matching). Essentially in Canada if someone has retirement savings it’s because they put it there themselves out of choice – unlike Australia where it’s a mandatory requirement of employers.

    • If you want to emulate Canada, maybe look at the Tax-Free Savings Account, then build that within the Industry funds.

      Next brainwave from TPTB will be building a CMHC (Fanny/Freddy) entity to notionally wear the risk. Then brace yourselves for 40 year amortisations etc

  3. Great article. It’s astonishing this information hasn’t been brought into the open before. Mr Xenaphon’s position on the use of super by FHBs is looking very compromised.

    • Marry this data with whatever the figures for the RBA and APRA are…….

      Then we start to have an answer to the policy myopia of this nation.

      Australian politics has a lot to answer for on this question.

      • “We are not sure whether to be relieved or concerned that of the five central bankers who were brave enough to note their occupation on their tax form, all five had an investment property! … Of the 200 occupations classified by the Australian Tax Office, the employees at the Reserve Bank topped the list with respect to their investment property exposure.”

        http://barnabyisright.com/2011/06/23/rba-officials-have-vested-interest-in-fate-of-aussie-real-estate/

      • Yes Gunna…but truly it’s everybody. The whole Pitchford thesis, debt doesn’t matter. we can print forever, service economy bullshit has been pedalled by Economic faculties in universities for at least five decades. it’s all connected together resulting in this damned mess

        I saw this comment at The Burning Platform which was spot on!

        “1)- The “Service Economy”, somewhere around the early 1990’s. I was a Software Engineer for Hewlettt-Packard. My territory was all of Northern Indiana. 90% of my accounts were MANUFACTURERS; —- US Steel in Gary, BF Goodrich, several auto and auto-parts manufacturers, RV and manufactured-homes businesses in the Elkhart area, two large GE plants (Specialty Transformers and Jet Engine, both in Fort Wayne), a grain silo manufacturer in Holland, Steelcase Office Furniture, and several others. Here’s what happened over the course of just a few years. One by one our software contracts dried up … either because the company went out of business, relocated elsewhere, or simply cut back monies cuz they couldn’t afford it.

        You see, to cover the loss of manufacturing jobs, governmentfuks invented the catch phrase “service economy”. This is the totally fucking idiotic notion that we don’t need to actually sell manufactured products!! Screw that shit, citizen! Trust us … we can grow and prosper our nation by doing each other’s laundry for a fee. Furthermore, we’ll legislate into existence thousands upon thousands of useless paper-shuffling jobs, and government “jobs” out the ass. And if you can’t get one of those jobs … don’t worry about it … WE’LL TAKE CARE OF YOU … FREE!!! Service economy my fat ass … at that point I knew we were fucked.”

        And so australia is too….but much worse!

      • Of the 200 occupations classified by the Australian Tax Office, the employees at the Reserve Bank topped the list with respect to their investment property exposure

        Does anyone know what is the occupation code of RBA officials? I tried looking up for up-to-date stats on the ATO website. But I couldn’t locate the occupation code for RBAcrats.

  4. Is it any wonder Xenophon’s backing such a ludicrous scheme? Anything to keep the music playing, he must be shitting bricks and blue lights with his debt load. Guarantee that 12 months after the Government adopts the policy, he’ll have offloaded at least half of his portfolio. It’ll be worth keeping an eye on. The world’s watching Nick. Thieves.

  5. We all knew this but it’s nice to be able to stick a number on it. God knows how big it is when you go through the many financial and ownership fronts and dodges available to the wealthy.

    When the revolution starts rumbling, the portfolios of these FIRE parasites are going to be uninsurable.

    • Confiscation would be ideal. They can sit in jail and wish they were born with more integrity, ethics and morals. I could not be more disgusted with our politicians.

      • Correct.

        In substance and character they are no less corrupt than the Chinese officials currently being purged, it is just that they do it legally, even though some of them have been the ones passing the very legislation from which they benefit.

  6. Of course the other telling thing is which ones have mortgages and which ones don’t.

    MT is hardly likely to need to go into debt given he got his money long ago through other means, but given the ages of these people, it’s telling that none of the rest are relying on debt free cash frow from their property investments.

    • Yes, it’s staggering that these public representatives are looked upon as successful yet where I come from if you’re of advanced years and still mortgaged up then there is only trouble in your future.

      What a mindset this country has.

    • Unfortunately the greens are motely mess of conflicting, half thought through policies and interests and ratbags but if they throw spanners in the works of the majors, go for it.

      • motley, not motely, ahh, who cares how a pitchfork wielding peasant spells.

        Just to back up my contention of the half baked nature of the Greens, they could be demanding a world class bus system for Canberra, but instead are so impractical, they are pushing for a 12 km show pony of a tram system that will only serve a tiny part of Canberra at enormous expense, and will help push up the specufestors property values along its route at the expense of the rest of the ACT.

        Then of course their conflicting policies on the immigration fed population Ponzi and urban boundaries and the loading of costs on young first time home owners, etc, etc, harming young and lower income people and doing their own cause harm! LOL These issues have been dealt at length by Macro’s blogger and old posters like aj, gunna, hugh, janet, etc.

      • Seems like the usual comments about Greens policies from people who clearly haven’t actually read them.

      • Seems like the usual comments about Greens policies from people who clearly haven’t actually read them.

        Have you ever read Liberal or Labor policies? The policies themselves are wonderful. What the scumbags do once they have power is what I don’t like.

    • The political system needs a good dose of the salts and many have to go.

      Where is the collective force to rally behind for our narrative so frequently voiced here at MB? Good luck writing to your local poli (read cheer leaders of debt), they will keep propping it up until they can’t.

      No, I do not want a depression/recession but with current leadership trends I see no alternative.

      • @uranium geo. That is THE valid point. These grubs are what they are…….now……how do we get rid of them?

      • Japan is hardly a model of success. They lost 20 years of economic growth, and end up with a national debt of 250%. The workers got poorer, the saving rate of households is now below that of Australia!! It resulted a massive shift of wealth from the ordinary Japanese to corporations via government deficit. The situation is unsustainable, especially since they’re now running a trade deficit due to LPG imports.

      • Yep ronin

        The CAD for Japan is the inevitable final outcome of its policies. They can probably get away with it without too much damage for a while because they already have massive international reserves. That said if the market starts to perceive their CAD as structural, and the only possibility for it is to spin out of control, then the Yen may cop a hammering.
        Mr Abe will then get a damned side more inflation than he bargained on. Then it all will REALLY spin out of control.

      • Stagnant GDP growth does not worry me. High unemployment does. We can’t have a correction without destroying debt-money. Therefore, someone needs to spend positive money into the economy to prevent very high unemployment and social harm.

      • LemmeC

        There is no such thing as positive money. If you print money into the economy without production you get debt somewhere.

        In this country it’s just a question nof how much extra debt you produce.
        Tell me a single way you can inject money into this Australian economy, as it is now structured, without creating more debt.
        It can’t be done without correcting the massive distortion of 60 years of debt creation and asset sales. This distortion cannot be corrected without massive dislocation.
        We are unable to have an adult conversation about this. on the one side you have the juvenile MMT brigade who believe in fairies at the bottom of the garden and on the other you have the criminal banking, lawyer, real estate lot. Both believe in teh same thing really…just print money!
        We are absolutely and totally screwed with no option but to follow the banking/re ponzi until it all crashes…catastrophically!

        The answers lie back in time…back when an emerging CAD signaled something was going badly wrong. The year was 1959!

    • Greens are amoral. No Christian worth any pinch of salt could vote for them. I admit, they will always appeal to a certain section of society – but thats it. Similarly to others such as PUP.

      I lived under their (effective) rule in Tasmania for a decade – and they utterly destroyed its economy and a whole generation of young people unable to find opportunity – or in many cases, even work. 50% of Tasmania is now made up of public servants and Federal government expenditure. It is a subsidised waste land. A very different state when I first arrived, which for a while, was toying with the idea of independence.

      • Greens are amoral. You might want to rethink that. atheist, possibly, amoral don’t think so.

      • Fair point – but stated within the context that relativism is amoral. Anything an individual thinks or believes at a certain point in time is subject to change, when facts or circumstances dictate. An external moral code does not allow that flexibility… which may seem a weakness at first glance. But its not. Because an external code allows collective homogeneous action and social movement at times of extreme stress unable to be sustained under (granted an initially more popular) heterogeneous framework. It is therefore more resilient and self-sustaining.

        Every major civilisation as far as I am aware has had a moral basis as a source of their existence – and the majority of those civilisations fail (within several generations) in a relatively short period of time following fundamental changes those beliefs that had previously sustained them.

      • I don’t know about amoral. I just think they’re clueless idiots. The electorate will never take a green party with no real environmental policies seriously.

        Be sure to let us all know when they do because I’m looking for an environmental party.

      • Frankly, it’s amoral that our pollies own multiple investment properties, cut benefits to low income earners whilst preserving negative gearing benefits for themselves. Do these Christians follow Christ? If not, I’ll vote greens because they are no worse than “christian liberals”

      • “But love ye your enemies, and do good and lend, hoping for nothing in return; and your reward shall be great, and ye shall be the children of the Highest; for He is kind unto the unthankful and to the evil.”

        There are no Christians … those who follow the plain teachings of Christ … in public life.

        There are only casuists.

        ****

        P ≠ P + I.

        Ban I. Again. Problem Solved.

      • Yeah because all those paedophile priests were so spotlessly moral.

        Religious =/= Moral

        Just as non-religious =/= amoral

        You criticise relativism and at the same time demonstrate the flaws of absolutism. Ironic.

      • Actually I know a fair number of Christians who vote for or are members of the Australian Greens.

      • Anything an individual thinks or believes at a certain point in time is subject to change, when facts or circumstances dictate. An external moral code does not allow that flexibility… which may seem a weakness at first glance. But its not.

        Yes, it is.

        The moral code of Christianity (and related religions) is fundamentally underwritten and enforced by fear and ignorance. It’s difficult to think of a worse reason to act in a particular way, than you fear punishment for not doing so.

        Because an external code allows collective homogeneous action and social movement at times of extreme stress unable to be sustained under (granted an initially more popular) heterogeneous framework. It is therefore more resilient and self-sustaining.

        Which can (and does) have disastrous consequences if said code is _wrong_.

        Every major civilisation as far as I am aware has had a moral basis as a source of their existence – and the majority of those civilisations fail (within several generations) in a relatively short period of time following fundamental changes those beliefs that had previously sustained them.

        What “fundamental changes” do you think have taken place in our “moral code”. What is a “relatively short period of time”.

        Our society isn’t failing because of the “moral code” represented by Greens policies, it’s failing because of the “moral code” of neoliberalism – selfishness, greed, ignorance – being followed by the other major political parties.

      • Isn’t Pious Joe a card carrying Catholic and same for Phony Tony?
        Indeed aren’t most of them card carrying Christians?

        Religion counts for nothing, sorry. (It just makes you look more of a hypocrite.)

      • Good move. Lets get involved in an argument about religion which distracts from the fact that our elected representatives, whatever their belief set, are conflicted to the point where they are incapable of acting in the best interests of the country.

        This is exactly the kind of divide and conquer bullshit that permits them and their cheerleading FIRE chums to continue getting away with as much as they do.

      • Lets get involved in an argument about religion which distracts from the fact that our elected representatives, whatever their belief set, are conflicted to the point where they are incapable of acting in the best interests of the country.

        Indeed. Let us return back to the original point made that The Greens appear to be substantially less “conflicted” on this issue than all the other parties, and that is a legitimate reason to prefer them.

        We can leave the argument offered against voting for them – the absurd implication that Christianity is the source of moral authority and the gross insult that atheists cannot be moral – behind.

      • What’s with this Christian nonsense all day long? What is a Christian? Do accept Christ as your lord and saviour or do following his teachings? If the later your problems are much bigger than the Greens FFS

        EDIT if the former go hang out with pedos and leave us alone

    • don’t confuse the wacky candidates with their voting block, they don’t have firm policies for fixing housing for a reason.

  7. This important data set needs to be handled with care.
    Voters should expect politicians to be financially successful – up to a point. We and our elected representatives need to acknowledge the unconscious bias toward existing landowners in their political deliberations.

    This is not a risk, this is an actual reality.

    Australia’s Future Tax System said introduce two victimless taxes (a federal land tax and the RSPT) and remove 125 distorting taxes to turbocharge national prosperity.

    When our elected representatives examined this reform agenda with their personal moral compass, they rejected it because of the perceived hit to asset values. Nevermind the country would boom and restore those values quick smart.

    I urge my fellow Australians to embrace the staggering benefits available in good taxes, low land prices and a economic system that nourishes enterprise over rent-seeking.

    I don’t want to jeer and sneer at pollies for being landowners, but simply recognise this influences thinking.

      • “Voters should expect politicians to be financially successful – up to a point.”

        Yes Jimbo, I expect my chef to be fat – up to a point.

      • I don’t know why we need to perceive or expect anyone to be financially successful. Substance should win out every time. The political system should be a broad representation of society, but as you say reality is another thing.

        Different system I know but I like the way China’s heading under Xi and he definitely doesn’t fit their historic, elitist leadership mould. We digress.

      • Attention Mr Collyer,

        your sarcasm detector has not been detected. Please attend to it immediately before making another humourless faux pas.

        Thank you.

      • You should have answered Jimbo’s sarcastic question with a sarcastic answer. Could have been as simple as “Of course!” Keep up the good work but don’t leave home without your humour. Cheers.

      • True Marshy, unless of course you’re the poor patsy on the other side of the transaction who realises you’ve bought a show bag.

    • Arguably, there’s only one politician in the above data that is unbiased – Malcolm Turnbull. Everyone else has a mortgage(s), and that’s the problem – not the properties themselves, but the debt that underpins the whole lot.

      • Righto? Were you being facetious?

        I have property and no loan. I don’t want property to drop. …

      • FIRE bankster aristocracy are above all that desperate mortgage grubbing stuff and signing their independence away to the banksters.

      • For me, Turnbull is the least trustworthy of the lot. I just don’t trust him.

        Tell me if this makes sense. A very wealthy man enters politics to make a difference. He then sits there says nothing and makes no difference. Or does he? Its certainly not fo the good of Australia or Australians. He’s a shonk.

      • Do people, rich or poor, go into politics to ‘make a difference’? I doubt it! It’s just like any other job; people do it to make themselves richer, one way or another. Maybe Malcolm doesn’t need the cash, and so respect or influence is the pay-off. But for most politicians? It’s just a job, and ‘making a difference’ is a by-product of it…..I’ve told the story before, of meeting a politician ( Labor) from the west of Sydney many years ago who openly admitted that he went into politics so he’d know which land was going to be freed up for the next residential development. Coincidentally, he got to own it just before the announcement was made! ( How lucky can you be!) Do we think the majority of other politicians are too different? I don’t……

      • Janet,

        You need to do some research into MT’s history. Setting aside for a moment the elephant in the room — Goldman Sachs’ “confidential settlement” paid on his behalf, to keep him out of court (while Opposition Leader pushing through the Rudd CPRS) as a named defendant in the $450 million lawsuit over the HIH collapse — just consider his role in pushing the Howard era housing bubble policies via his then-chairmanship of the Menzies Research Centre, and the Home Ownership Task Force —

        http://www.menziesrc.org/publications/item/menzies-research-centre-s-home-ownership-task-force

        http://www.theaustralian.com.au/archive/news/hih-score-settled-for-malcolm/story-e6frg6no-1111119117953

        rich42 is right. MT is arguably the least trustworthy of the lot.

      • rich42,

        “He then sits there says nothing and makes no difference. Or does he?”

        A few years back, a while after getting booted from the opposition leader role — where he was pushing “bipartisan support” for the bankster class’s emissions trading scheme — MT very publicly announced he was retiring from parliament.

        Flew “overseas” immediately. (NYC, anyone?) Mere days later, rumours starting circulating that he was “reconsidering”. Then … quelle surprise … he announced he was staying after all. Right around the time Rudd announced he was dropping (“delaying”) the CPRS.

        Blind Freddy can see what MT is doing, just sitting there, waiting, doing nothing.

        He is the member for Goldman Sachs, and they still very much want their cherished global emissions trading scheme.

      • :Lloyd,

        Unlike a mortgaged to the eyeballs minion of the FIRE aristocracy, he doesn’t care how his property values bounce around, he has all the wealth he needs for his real ambition, POWER.

        When the moment is right, the polished, sophisticated, urbane and rich Crassus will step forth as the Messiah ready to save Rome from the revolting slaves and he will sacrifice those ignorant clowns, the Suppository of Wisdom and The Wide One to the mob of the angry mortgage serfs.

        Then the banksters will have absolute power.

        But the continued destruction of the economy by the FIRE sector cancer will bring the inevitable revolution ever closer and not even Crassus, with all his connections and sophistication will be able to stop it, merely to delay it.

      • I may have have said this previously… but MT is a very talented but flawed individual, with an equally very big history prior politics. Not sure if he is suitable to be PM.

    • David I agree with you at one level, we do (along with almost all British based democracies) have a landowner bias in electing politicians.

      But at another I think we need to recognise that Federal parliament (and I am fairly sure all the State parliaments would be broadly the same) is essentially a $300m REIT overseeing macro settings for an economy which sees the RBA (and we need to see data along the same lines for them I reckon) currently trying to stay Australia’s post mining investment boom adjustment by keeping the heat under a real estate bubble.

      This is against the backdrop of Australia having about the world’s most expensive real estate, amongst the worlds most heavily indebted private sector, with most of that private debt in real estate, and with some of the most constipated real estate planning to be seen on the planet, as well as most sentient people recognising that Australia’s real estate addiction is now cruelling Australia’s economic future and ransoming future Australians.

      This is a political failing, and if we pair up the political failing with the vested interest of Australia’s politicians and identify that the failing coincides with those interests, then it is time to make the call for what we see and act accordingly.

      Currently Australia’s aspiring property buyers (those who will be paying the taxes on which the debt takers of the present will be relying) have nobody in parliament representing their interests apart from those who see them as an ‘investment opportunity’.

      • Well said Gunna, with one quibble – most sentient people within Australia do not recognise that our real estate bubble is disastrous. Collective Stockholm Syndrome, I guess.

      • +1 Gunna

        I also question what it is that makes one “financially successful”.

        Could it be that individual who:

        – spends decades working in the service of others for a relatively low wage,
        – pays off a modest home in which they raise children who are an asset to society,
        – saves and waits until they can afford it to buy anything,
        – does not seek to exploit every incidental loophole and opportunity in social security and tax policy,
        – takes responsibility for provision of their own retirement funding to the extent circumstances permit,
        – strives to act decently towards the people they come into contact with, and maybe help them out a little?

        This kind of person seems to be considered a gullible fool these days. How much do you need? If it weren’t for a poorly managed economy I imagine we could all do with a lot less.

      • Linguine ai frutti di mare

        Ozquoll ‘Collective Stockholm Syndrome’

        I agree. I swear that some people want to be ruled over.

    • Yes david and I refer to my comment above re universities. Where we are at, and where the politicians are at, is simply the rational end product of 60 years of stupid economic BS taught by Universities everywhere (pretty much)in the Western World

  8. moderate mouse

    From same blog:

    ‘Unfortunately this myth that Australia has a land shortage is both epidemic and comedic. All of which is sponsored by a loosely regulated retail banking system. If you are an Australian and believe that Australia has such a land shortage that the cost of real estate across Australia is justified, I strongly suggest purchasing a plane ticket to Japan and travel their countryside and visit their cities.’

    Couldn’t have said it better myself!!! Although God knows I’ve tried many, many times….

    Looks like the scene is set for a good old fashioned show down between UE, PhilBest & Co versus the New Kids On The Block. Pistols at twenty paces….

    Yeeeehaaaaaaw!!! Bring it on!!!

    • Australia clearly does not have a land shortage. Australia has serious housing shortages across its cities and towns.

      The reason is simple. House = land + permission to build. Government has choked the supply of permission to build on Australia’s abundant land.

      Compare the price of adjacent land, one with permission for more dwellings and the other without permission.

      The result will show you where the shortage is.

      • moderate mouse

        ‘Australia has serious housing shortages across its cities and towns.’

        Claw my good mate – we’ve been over this. There is NO SHORTAGE OF SHELTER.

        So what exactly are you proposing? That we build enough houses to satisfy the specufestors (including Senators and Reps above)?? Doesn’t make much sense. There’d be two houses for every one person before you achieved that goal. What’s the end game?

      • Ahhh The Claw. Good to see housing lobby here again.

        Government has choked the supply of permission to build on Australia’s abundant land.

        As a shortage spruiker, and one who has no doubt benefitted enormously from the “shortage”, I assume you support the continuation of this policy?

      • So Claw, what happened circa 2010/11 when the overall market took a 10% hit and established parts of affluent Melbourne for instance took 20-30% falls. Was there a sudden spike in supply you can point to?

      • moderate mouse

        @ Lorax

        You may be misreading the Claw – he wants permission to build, build, build – knowing full well prices will continue to do as they will.

        Credit where it is due though – at least Claw doesn’t truly believe the shortage myth and is just talking up his own pocket. Unlike some others around here….

      • So Claw, what happened circa 2010/11 when the overall market took a 10% hit and established parts of affluent Melbourne for instance took 20-30% falls. Was there a sudden spike in supply you can point to?

        I assume you are referring to prices falling 10%-30%.
        Prices can fall X% without a sudden spike in supply. You need to study supply and demand a little bit more.

      • As a shortage spruiker, and one who has no doubt benefitted enormously from the “shortage”,

        I spruik nothing. I have been harmed by the shortage. Keep up these comments and I will have you banned.

      • So what exactly are you proposing? That we build enough houses to satisfy the specufestors (including Senators and Reps above)?? Doesn’t make much sense. There’d be two houses for every one person before you achieved that goal. What’s the end game?

        Allow young families to purchase land (from whoever will sell it to them) and build a dwelling for themselves to live in.
        The end game is that some affordable shelter is available for people who require shelter. If more classy shelter rises a lot in price this is not a concern of mine. I care mostly for the people who require basic shelter.

        These people own large plots of land within commute of Sydney CBD and are begging for government permission to have more than one house on each large plot. There is the land. The buyers are there. All that is missing is government permission to build.
        http://www.5acresnow.com.au/

      • @ Claw

        ‘These people own large plots of land within commute of Sydney CBD and are begging for government permission to have more than one house on each large plot. There is the land. The buyers are there. All that is missing is government permission to build.’

        And there it is…the money shot! ‘These people’…..doing it all for the good of the nation. Yeah right. Puke.

      • And there it is…the money shot! ‘These people’…..doing it all for the good of the nation. Yeah right. Puke.

        You fit clearly into the abusive smartarse category of shortage-denier. I have dealt with your kind before.

        These people who wish to divide 25 to 40 acres plots into 5 to 8 smaller (5 acre) plots clearly stand to make a lot of money from this. However some of them are old people who only wish to carve off one or two blocks for their children. Their motivations are not a concern to me.

        In case anyone missed it, the point I was making is that this PROVES that government is egregiously choking the supply of permission to build. I was not praising these land owners for anything.

        You chose to make a smartarse comment while ignoring my main point. That is a common shortage-denier tactic also. Stick to the point please.

      • What’s the end game?

        Anyone who wants to buy a reasonable house within reasonable distance of their workplace at <3x their annual income can do so.

    • Jump on your bike and I’ll take you for a spin out the back of Lismore, Casino. And that’s just for starters.

  9. Nice one UE.

    What a disgrace. If something like this got through parliament imagine the risk to the budget. A generation who used their super to buy property then lost it because of a price correction and all on the pension.

    I hope Xenophon gets dumped at the next election.

    • Agree 100%.
      I just can’t see how a reasonably intelligent individual can promote such dangerous policies. Don’t these guys read MB?
      Are these people so shallow?
      Maybe Nick’s a bit dark because RE prices in Adelaide haven’t hit those insane levels like Sydney and Melbourne.

    • He’s not going to get dumped. He’s got the weight of greed and vested interest of the electorate right behind him.

  10. Xenophon’s family were in the building and property development business. 

    His family own office buildings in Adelaide.

    Old money? Relatively new, but he’s not the generation to lose it.

    Chinese proverb “Wealth does not pass three generations” 

    “The first generation works extremely hard to build the family fortune. The second generation reaps the benefits. The third generation squanders the wealth. While the second generation may see the value of hard work, the third forgets it.”

    I wonder where all the other politicians sit in this regard.

      • Easily. He’s in his 50’s.

        He bought property when young. Property quadrupled in price alone from the 90’s let alone 80’s when he probably first purchased.

        Then invested say 20-25% of his income, and presto a large portfolio

  11. No surprise politicians are vested crooks although it is very disappoiting to see Xenophon in here. In the past he has tended to be straigher than the rest, but now its clear he is just another bent clown putting his own interests ahead of the rest of the country. Yes why not sink your pension into housing, you can’t lose and if you do the state will bail you out. Win win /sarc.

  12. Exactly, imagine the next crop of politicians who have an even bigger exposure to property. With their wealth and the countries future tied up in property they will go to even greater lengths to sustain the bubble.

    • It begs the question, how were other countries unable to do the same. One would think being older societies than ours, land based wealth would have been very deep rooted. Why weren’t they able to stop deflation? Are we really different? Are our leaders more vested in this than any other?

      • Jimbo

        We have had absolutely massive natural resources available to us to sell off to that we could sustain this damned crap. That’s how it’s done. You just build houses, have immigration, service industries, a huge retail sector, make sfa and trhen sell your natural resources, in situ, to any foreign interst willing to buy them. Pretty much no other nation in the world has such a level of ‘God-gifted’ natural resources per head of population.
        We are a long way down the track now with reportedly 86% of our mining resources having been sold; vast swathes of our premium farmland, ALL the food processing bar a couple of minor players. Now we are selling them our RE, making houses even more unaffordable, just to keep this bullshit alive.

  13. David Gillespie, the Nat with 18 properties, he’s the guy who won Rob Oakeshott’s seat right?

    So we lost Windsor and Oakeshott and got Barnaby and Gillespie. Great trade! Go Straya!

  14. We deride Xenophon, yet what if we consider the future possibilities or for that matter the unforeseen.

    Eg what if they introduce a forced reverse mortgage for these people when in retirement (should they live that long).

    In theory, the house bought with super funds will then be used to fund retirement (as intended).

    Watch this space.

  15. This is the best article I have ever read on MB. Be good to see everyone push to Twitter, FB, G+, their local member etc.

    • I agree tmarsh,

      This really cuts to the core of why so many wrongs are left untouched for so long, and indeed perpetuated. it is not a stretch to see how most of the ills suffered in this society are ultimately rooted in the base nature greed of those who govern us.

      • My grandfather’s funeral was last week. I reflected upon the 40 odd years he was an agent, president of REIV etc.

        One night at dinner he told me how he’d on numerous equations turned down the offer to buy into property syndicates developing very vast tracts of land around Moorabbin, Dingley, Wheelers Hill and so on. When I asked why, he said his job was to represent the interests of the seller and to act in good faith as an agent and not participate in the profit.

        The profits I can assure you were staggering to my mind.

        Speaks of how things used to be, and how things ought to be. Integrity > $.

      • Integrity > $.

        Alas, not in a world where love of $ = GOD.

        I see us free, therefore, to return to some of the most sure and certain principles of religion and traditional virtue – that avarice is a vice, that the exaction of usury is a misdemeanour, and the love of money is detestable, that those walk most truly in the paths of virtue and sane wisdom who take least thought for the morrow. We shall once more value ends above means and prefer the good to the useful. We shall honour those who can teach us how to pluck the hour and the day virtuously and well, the delightful people who are capable of taking direct enjoyment in things, the lilies of the field who toil not, neither do they spin.

        But beware! The time for all this is not yet. For at least another hundred years we must pretend to ourselves and to every one that fair is foul and foul is fair; for foul is useful and fair is not. Avarice and usury and precaution must be our gods for a little longer still. For only they can lead us out of the tunnel of economic necessity into daylight.

        – John Maynard Keynes, Essays in Persuasion – The Future

        http://www.interestfreemoney.org/papers/extract-keynes-essays.htm

        Sincere condolences for your loss.

      • Good for him tmarsh.

        Sounds like a man who recognised what constitutes real wealth.

        Sorry that he’s gone.

  16. PS: Xenophon’s idea should be extended. If you have super and want to pay it off your house balance to reduce non deductible PPoR interest, you ought to be able to do so.

    I’d rather be saving the money now and getting the balance down whilst interest rates are so low.

    • The issue isn’t the interest rate it’s the crazy principal amt you have to repay as well – and all for no good reason.

      Anyhow, I am just about fed up with this whole issue. Even respected colleagues can’t see the problem. It’s like empirical law – RE prices always (must) go up and if they don’t they just plateau for a while.

      • @ ericskeric , same here. You try and explain to them your views and you back it up with logic and numbers and… but you end up being frowned at like some kind of a whacko and doomsdayer!!!

        I don’t discuss this matter with anyone anymore unless i feel they are open to consider the other side of things the same way i am open to listen and think about their views on the matter.

      • Sounds like what is happening to RE: do a survey of 100 people on the street and ask if real estate prices only go up and see what the response is.

        Bubbles, or unsustainable increases in asset prices, are evident in real estate prices and prices of other assets at various times. In these situations, market participants take recent price increases as an indication of higher future asset prices. The expectation of higher future prices then increases the demand for the asset (i.e., shifts the demand curve to the right) which again increases the equilibrium price of the asset. At some point, the widely held belief in ever-increasing prices is displaced by a realisation that prices can also fall. This leads to a “breaking of the bubble,” and the asset price falls rapidly towards a new and sustainable equilibrium price (and perhaps below it in the short run).

  17. Haha and this is just the tip of the iceberg, family trusts, spouses, companies held by trusts etc etc.

    Hahaha

    Cop that peasants.

    • In particular, the Canadian experiment has caused this:

      “Well, now the Home Buyers Plan has been used about 2,500,000 times and roughly $30 billion has been removed from financial assets inside RRSPs and dumped into the real estate market. Combined with cheap mortgage rates and lenient bankers, this helped push average detached home prices over $1 million in two major markets and made houses so expensive it takes over 70% of gross income to own one in Vancouver.”

  18. Full marks to Lindsay David , Paul Egan & Philip Soos for this excellent investigative article. Fairfax would never publish this, it would go against their prime directive of spruiking property no matter what. One can only feel that the property mafia and political representatives are nothing short of the secrecy of the Freemasons, there to protect their own and keep the ignorant ignorant and maintain their position.

    • +1 they will have a petty hit out at Entitlement Joe over the budget, but heaven forbid they actually follow up on some real journalism that might bite the one bit of revenue flow they have left.

    • Funny isn’t it. Any other topic and they would be drooling over a bit of investigative journalism like this.

      Even if it gets a low key run somewhere toward the back pages, I have a hunch it won’t be front page news.

  19. The coalition can point to these charts to confirm they’re better (personal) economic managers.

    • General Disarray

      Ha!

      That’s an impressive haul for the Coalition. The ALP needs to have a long hard look at itself.

      • For a while aj.

        Right up to the day the great revolutions begin, the parasitical aristocracy are convinced of their invulnerability. Nothing changes, then everything changes, forever.

      • Warning: sucking up line:

        For the last year I’ve been reading Macro you’ve been one of the posters I most looked forward to:

        Warning: but line:

        We must not give in psychologically. Wars and revolutions are first won and lost in the head.

        Besides, I’m fully aware of the exponential rush of foreign kleptocratic monies from developing countries into rich western countries like Australia. That process will initially reinforce the status quo but in the longer run will actually backfire as it feeds the flames of revolutionary revolt.

        Our parasitical parliamentary Judases will learn one day that their betrayal of their countrymen is going to be the worst investment decision they made and the foreign kleptocrats will wish they had never invested in our RE. That day is on the distant horizon, but the fact is it is already visible. Nothing can stop it now. Nothing. Cheers.

        Th

      • True, for now aj. But as that grows by leaps and bounds that is precisely the thing that will make ever more people mad. Who’s country is this they’ll ask, ours or the foreign kleptocrats? Nearly all parliamentarians will revealed as the Judases they actually are. Then things will become uncontrollable – good bye FIRE parasites. Nice stamping you out!

    • Ha. It’s true that it’s probably worse than most realised, and these are generous numbers, they hide assets residing in ‘uncontrolled’ vehicles.

      People that doubt the future sell off and ongoing population ponzi are deluded.

    • I always enjoy reading your educated and informed commentary. Don’t get depressed. Drink a bottle of red tonight instead. It works for me. Cheers.

      • Thanks David…appreciate the comments…I’m a glass or two of good ole De Bortoli to the good!

  20. A smart wealthy group of politicians invent policies to enhance their wealth again and again and again and again.

    An incredibly dumb group of politicians (the Greens) will endorse them again and again and again and again.

  21. HealthyInvestor

    You have to remember, politicians face a lifetime of scrutiny and basically have to give themselves over to the community.

    They do crappy hours and are never left alone. They can never get drunk without being picked on. They can’t do anything.

    A lot of successful people become politicians which is good. You want people who know how the system works to make it happen. They know they environmental requirements to support a population. They listen to facts not media bs and rumor.

    I’ll give you a great example. The city of Fremantle in WA. Now there’s how not to pick a poly and council. Arrogant and backwards hypocritical monsters who terrorise the population with feel good messages but secretly only ever look after their own agenda to the detriment of their constituents. As a result they created slums. Discourage business. Accept bribes and can’t be voted out because they basically pull the wool over people’s eyes. Blanket coverer the area with how green and safe and community drivin they are but in fact they are quite the opposite. They actually threw out reports and recommendations to improve housing supply and jobs and instead voted backwards to limit and heritage their existing housing to prevent development denying their own children homes. On top of half a dozen other rejections to the point where they are getting merged to stop the abuse. Then they approved dogbox apartments to be built on the fringes away from any of the key infrastructure that everyone has to pay rates for but only the core elite can use. That’s what’s happens when you have petty small minded unmotivated people get into power. Thank god they can’t make it federal level and only ever rule such a small area. Imagine if they got a say at a federal level. Australia would be just as screwed in the same time it took freo to turn from boom to shanty town hobo bust city, about 20 years.

    As a whole the federal level does a half good job. People shouldn’t get angry at successful people they should learn from them. Put back into the community and the community will put back into you.

    • Interesting comment about the problem in Fremantle. However something to remember about successful people in that Hitler was an extremely successful man. He gained many votes and then made an enormous amount of money and land and art works. All this was done legally. Starting from humble roots, Adolf Hitler was as self-made as a man can be. Of course I don’t support what he did and don’t admire him. But the facts remain that he was successful and rich until strong military forces took his wealth and success from him.

      • wtf?

        Hitler’s pre-political career(s) were a dismal failure – his only money-making enterprise were sales of his book, which was not exactly separate from his political career.

        The NDSAP are a perfect example of a bunch of people who couldn’t make it in the real world going into politics to get their hands on wealth and power essentially via trickery.

      • Hitler’s pre-political career(s) were a dismal failure

        I was referring to the later period in Hitler’s life. The part where he and his mates acquired land, money, gold, people and art works from what were previously other countries.
        You should study history a bit more and wtf a bit less.

      • You made the following claim:


        All this was done legally.

        Theft is not legal, even in wartime. Many of the surviving ‘mates’ were held to account for those thefts in trials held soon after the war.

        Rousing “strong military forces” is kind of an occupational hazard for anyone who themselves uses strong military force to obtain wealth and power.

        In other news, terrorism, arson and electoral tampering are also not strictly speaking legal, now or at the time of the Weimar republic.

    • My heart bleeds for them.

      Wait, no it doesn’t.

      If they don’t like it, don’t be a politician. But they must like it, look at the rentier-ism they can support.

      You point to Freo: “Arrogant and backwards hypocritical monsters who terrorise the population with feel good messages but secretly only ever look after their own agenda to the detriment of their constituents. ”

      How is that ANY different. It’s not. If they cared about Australia they’d abolish NG and whatever else everyone here has said.

    • Successful people should successfully declare conflicts of interest and they should especially not cut benefits to poor people so they can benefit from negative gearing 4 houses. And further, they should not introduce self-interested legislation to access super to boost house prices so that their 8 investment properties go up in value.

    • @HealthyInvestor
      I lived in or near Freo most of my life. Yes, a backwards bunch of left leaning individuals have done a lot of damage in that area. I also recognise the damage the right and far right has done in Canberra in recent years. Like Freo, it will just take some time for those consequences to be visible. Housing affordability is just an early warning sign.

  22. And the current members of the Senate Economics Reference Committee which ran the housing affordability enquiry are…

    Sam Dastyari – two properties
    Sean Edwards – seven properties
    Matthew Canavan – no declaration
    Kim Carr – two properties
    Chris Ketter – no declaration
    Nick Xenophon – eight properties
    Jan McLucas – two properties

    Admittedly, this is the current committee membership and not the membership of the committee as it was when the enquiry was held.

    Will be interesting to see what new senators like Bob Day and Leyonhjelm declare. They’ve said plenty about housing affordability, but I bet they’re in on the game too.

  23. share the link to this page on as many open social media forums as possible people. Your electorate needs to read it

  24. You guys should read Lindsay Davids book. How on earth can anyone honestly say that any of this is a surprise?

    Everyone’s spruiking doubling of prices in this or that but don’t even have the mathematical ability to do a simple 2 to the power of n calculation.

    LMFAO! No wonder they import people to do the real work…

  25. What would happen if a politician had invested the equivalent amount of 2.1 houses in say…Mining stocks (eg BHP,FMG, RIO).

    Then this same politician motioned, advocated and voted to remove the mining tax. Then thereafter advocated for pro-mining tax subsidies.

    Would this be a conflict of interest and if so whats the difference if the same politician has 2.1 investment properties and does the same thing with housing policy?

    • Good on them for running it at least. Also saw a link on the Fairfax ‘Markets Live’ Forum – surprised it got through the Ed’s there. Great piece of work by the boys.

  26. F*cking disgusting. Bookmarked and filed under “why I want to leave this sh*thole country”

  27. I think that the very first comment (Houses and Holes at 8am) eloquently expresses, in a mere two words, the profound disgust and disquiet with which we should consider the ponzi-puffing, self-serving, nauseatingly blatant conflict of interest revealed in this article.

    Makes me wonder: why are the newspapers not all over this? Oh, sorry – I forgot: The media owners themselves share in this bonanza.

    So, even as our politicians continue to blow a bubble that in the long run risks blowing up the Australian middle class (as happened in the US not so long ago), deposit rates on deposits by pensioners and anyone else stupid enough to actually save money are cut. It all makes sense – if you’re living in Bizarro world.

  28. the only way to pop this bubble soon is to help inflate it more. Everyone who wants houses to be affordable should switch sides and start spruiking

    • You won’t need more spruikers, this is an epic one-sided trade where everyone ‘knows’ the government and the RBA have their backs.

      The blow-off will be magnificent, the down will come when nothing more can be done. My expectation is that Australia will not survive the next Asian crisis, that will be when the unsustainable becomes unsustainable.

      However, as we saw post the GFC, the government will move swiftly to undermine the currency and avoid asset deflation. Temporary deflation shock followed by further currency deflation and relative asset price inflation.

      There are only assets now.

  29. What is very clear is that Xenaphon is a fraud, he is not a keep the bastards honest sort of guy, he is a ‘i’ll moralise when it suits my voting block’ sort of guy.

    Our Tassie wit from ‘Idiot Tax’ has it nailed.

    • Bang on.

      All those years railing against pokies and sticking his head up to bignote himself on whatever cause of the day took his fancy, all the while making out like a bandit, and ignoring broken economic management and policy which has done more harm to this country and its people than poker machines will ever be capable of doing.

      Hypocrite extraordinaire. But of course it was all legal. Yeah pal, so are poker machines.

    • Foolish me! I had him a little above the rest of the conmen, but now I’m feeling like I’ve been Xenoconned too!

  30. Even though a normal house in Syd is now 1.2m. I still don’t see much desire out there to pop the ponzi. More a resignation. Ie fuck it I’ll just live in a unit, rent or move to Newcastle. Anyone else have a different experience in the real world?

    Yeah vote Green I suppose. They’re the most likely to interrupt the economics of this country. They’ll also allow Mig to get married. But I’m 99% sure SPP would be preferencing the Greens before Lib/Lab.

    Even if these polis didn’t own any ips. I’d say their media and banker overlords would insist on the same policies or else ostracism and humiliation would swiftly ensue.

    • Yeah resignation is about it. In Melbourne the answer is to build in Truganina or Drouin, or just rent in the hope something changes, but same diff really.

      • @ Turnitup

        Yes, I lived there for a couple of months this year when first arriving in Melbourne. Houses built on small blocks, duplexes, and flats. It is a joke and the roads still haven’t been completed or upgraded.

        When you walk around the street there are smashed windows on some houses and vehicles parked in the street. Coming from a regional center I was appalled at with the amount of rubbish found just dumped on foot paths.

      • “They’re the most likely to interrupt the economics of this country”

        Yes but they’ll interrupt it in the wrong way and make this whole problem worse.. Greens want to screw all production while at the same time expanding govt and services.. Therefore the CAD will explode. Therefore we will have to sell even more assets to foreigners to fund ourselves. Houses will be cheap for foreigners and expensive for young Australians.
        When collapse comes we have to move in productive ways not anti-proiductive!

    • I fancy myself as a good judge of character. I always thought he was a grease ball just by looking at him.

    • I dunno Rapper. Perhaps he is just wanting to put all young people on the road to success through property!
      We can all be rich! Rich i tells ye!

      • Flaws, My daughter was home tonight and guess what? She is going to ” gear up” and get a bigger house. Yes, I’ve learnt something and it’s those who own and control land and resources who will lord over the rest. Today’s posts attest to the political elites ruling in precisely this manner. How can society operate without usury? Im still struggling with this idea. Have you opinion on the Bradbury Pound?

      • David…whatever the scheme is think of what happens to the money. So somebody issues say 1000 Bradbury pounds to some individual in this economy what happens next? On average across the economy more than 40% will be immediately spent on imported goods….higher CAD more debt. The other 600 pounds gets spent on domestic goods. Do we have enough supply to avoid inflation? Now, if, at the same time, the Govt is running a deficit, and there are nil savings, all the remaining 60% money goes around in another loop and a further 40% disappears into imported goods and the CAD…more debt. So it goes on until nearly all the printed money becomes foreign debt.

        There is no point in anyone saying ‘but we’d spend it on infrastructure. The first thing we do in that case is go buy a D10 to push up the dirt! – More debt! Then the money ends up in the same consumption loop as above.

        It really is a quite long and complex business to argue right out because you have to consider a myriad of possibilities all teh time. However the essential point is that in this economy, and indeed most western economies printing any form of currency or credit simply results in more REAL debt to approx the level of the amount of money printed.

        P.S. The point is really we have to start SAVING first whether that be at a Govt or private level. So it really is more taxes, higher interest rates etc that would hit our economy really hard. We have to invest in really productive processes. Now if you assess investment by criteria that fit the current economy, while ignoring the external account, you’d get urban freeways, suburban rail, etc etc. Investment in regional Aus, that produced export income in the long term, would generally look pretty bad business. The debt based consumption economy we have is so long entrenched and economics itself so badly perverted it seems impossible to have a sensible conversation. We have created so much distortion any move to alter direction just won’t add up. e. g. raise interest rates (while adopting pfh’s recommendations re the capital account) to positive RAT (Real after tax) in order to encourage savings and the whole retail/housing game on which our economy is now based would collapse.
        The service based consumption based economy has to be at least partially disbanded. Unemployment and other dislocations surely accompanies this sort of transition but that is where we are at. We are out of choices.

  31. I’m late to this discussion. What can I add?

    Superb journalism. This is what it should be all about. The MSM is a disgrace. This article needs to go viral.

    Obviously Australia needs a new political movement to ride this issue to seats in both houses.

      • Hmmm, well done that man.

        I wonder if he was quick off the mark once Soos, Egan and David put their analysis online…… better late and with your hand forced, than never, I suppose……

    • You can’t add much except to say what political movement do you think is possible. Australia is not democracy. It’s a plutocracy. See Ted Macks speech on Google for a very good explanation why. My daughter bought a house 14 months ago and the ” value ” of it has risen over $80k in 14 months. She, like most people in their late twenties see this as the only game in town and who can blame them? She now says sell it and use the ” profit” to buy another one. Gen x and Y or whatever they are see working for a wage as a dead loss and property speculation as the way to ” get ahead”. Folks on MB blame boomers for all the woes of the day but the reality is that people of all ages who have the opportunity to speculate out of greed will do so. It’s human nature. Australians under 30 have no experience of recession and if they are on good wages think the party will go on forever. However infinite growth in a finite world is not possible and when the reality of this arrives it’s not going to be pleasant. Australians are going to experience this truth. Borrowing from foreigners to postpone this reality will only make the day of reckoning worse.

      • However infinite growth in a finite world is not possible…

        Yup. My point.

        P ≠ P + I.

        The “growth”-based economic model is driven by usury-based “money”.

        It is a mathematical impossibility. A fiction. Financial alchemy, with roots directly traceable to the Renaissance-era humanist syncretism of Hermeticism, Kabbalah, et al, financed (ie, “patronised”) and propagated by the ruling Medici thence Fugger bankster class.

        Ban Usury. Problem Solved.

      • David…for goodness sake set her straight!!! Don’t sell it! Just lever up the profit into another property! Good Lord have you all learned nothing!

  32. The other thing to remember in all this is that this is presumably only off what is listed in the parliamentary register of interests…..

    ….and just imagine how much is stashed away in trusts, wives, childrens aunts and uncles names, self managed super funds, and sitting waiting for the end of the parliamentary career as a ‘gift’ from someone benefiting in the here now.

    Magnificent work by Lindsay David, Paul Egan and Phil Soos.

    • +many. I think we can easily put a x5-x10 on the “robust” average. Looks like some on the list were not smart enough to “hide” it and the average in this case is skewed.

      I would assume the real value would be in the billions, less liabilities ofcourse.

      • ‘less liabilities ofcourse.’

        You betcha, look at all those multiple mortgages too. Who wants to do some research on how many of those are negatively geared………

        ……….and of course there is the not unreasonable question of how many of these purchases may well have been influenced by decisions made in politics which they were privy to in their political roles?

        Like if you knew the Government really was planning to move the ATO to Tasmania, or parts of Defence to Townsville and Rockhampton you would be a mug not to buy a little somehting there wouldnt you….

    • Notice that is just a straight piece of reportage limited to what the report found?

      No comment, no discussion of the implications, no consideration of how it may shape policy development or even voting, no consideration of the State parliaments whatsoever.

      I reckon all they have done is seen the piece here and figure that they needed to at least mention the same report so as to maintain credibility. At least Business Spectator had Callum Pickering produce a chart or two and something looking like a decent opinion.

    • I thought it was a pretty good effort to turn that into spruik! Nothing more than an effort to keep the aspirational great unwashed focussed, with a dash of an appendage measuring contest thrown in.

    • Values in Sydney grew over the year to July by 14.8 per cent, while Melbourne’s rose 11 per cent, RP Data figures show.

      Just throw that in casually, because, you know, that’s completely normal…

    • Written by spruik-bot Simon Johansen no less. This isn’t a news or opinion piece, this is a spruik article glorifying the property hoarding of our political elite and praising them, basically pointing them out as property investors to aspire too.

      And surprise surprise, commentary on the article is disabled.

      Where’s the independence Fairfax? You run the Government daily into the ground for any insignificant infraction, yet property hoarding is glorified and given full spruik?

      This article is an absolute disgrace.

      Fairfax is the Property Mafia elite, treating their readership and public like fools, basically censoring information to push their own agenda.

  33. More owner occupied properties than occupiers….CGT free of course. ATO please investigate!

  34. Ladies and Gentlemen!!!

    It gets better…….

    ICAC hears Liberal party boss Brian Loughnane knew developer donations went through federal channels

    http://www.smh.com.au/nsw/icac-hears-liberal-party-boss-brian-loughnane-knew-developer-donations-went-through-federal-channels-20140806-100vlc.html

    ‘An email shown at the commission suggests Mr Loughnane may have been aware of potential arrangements for donations from property developers – which have been banned in NSW since 2009 – to be made to the federal party to subvert the donations ban.

    “Brian Loughnane has agreed that for the time being the Fed Sec will operate on the policy … in effect, there is no benefit for a NSW donor to donate via the Fed Sec, unless they are a property developer,” said federal Liberal executive Colin Gracie in a 2010 email to Simon McInnes, the finance director of the NSW Liberal party.

    Mr Loughnane’s wife Peta Credlin is Prime Minister Tony Abbott’s chief of staff. He did not respond to requests for comment.

    But NSW Liberal Party state director Tony Nutt disputed the context of the email on Wednesday, saying that the comments were made during a discussion about a potential donation by a non-developer to a federal seat, where the ban does not apply.

    The inquiry heard separate allegations that members of the Liberal Party subverted the donation laws by diverting money through an alleged Canberra-based front known as the Free Enterprise Foundation, before sending it back to the NSW branch to use in the 2011 State election.’

    Nice to know that it isnt just the politicians in on the act

    • Sigh… This is the most tragic thing about this land boom – the new corruption it has engendered. Once infected is almost impossible to cure.

    • I’d like to puncture a few of the fat bastards with a pitchfork before she goes down.

      You know, just to make sure they don’t float to safety.

      • You cannot kill them. They are like cockroaches.

        After you thought you got them with a pitchfork, the next thing you know, they will start swimming again!!

        BTW, Darth Brandis is tracking you…..

      • I agree with dumpling, pitchforks are inefficient.

        But it would seem there are some interesting new developments unfolding in West Africa at the present……

      • Yeah, somebody should inform them that there are a bunch of wealthy property investors in Sierra Leone, Liberia and Guinea who would welcome a tour of MPs from here.

        After all, someone with impeccable credentials needs to explain to these potential foreign investors that our strict-looking FIRB rules are all but facade…..

      • Well a batch of them have just trotted off to China to (somehow) see how foreign buyers are handling FIRB and influencing the local RE market.

        Maybe we could get a 220 strong multiparty delegation to visit Lagos on a fact finding tour…

      • In that case, just tell these delegates in China that it is in fact cheaper to fly back here via Freetown than the direct route and that the new efficiency dividend measures imposed by the PM require every public servant and MP to choose the most economical route…..

  35. Australia’s all-in punt on real estate is starting to remind me of the ‘bad economics’ chapter of PJ O’Rourke’s book, ‘Eat the Rich’.

    Been a while since I read it but the crux of it was a poor, misguided country (Albania) thinking it was on the path the riches and warmly embracing a new-found capitalist economy when instead the entire population had fallen for a ponzi scheme. Naturally, reality kicked in at some point, it fell over, and, yes, there were many tears before bed time.

    If only they’d had a full floating exchange rate and their own currency they could still be happily running the ponzi today!

    • “If only they’d had a full floating exchange rate and their own currency they could still be happily running the ponzi today!”

      High quality sarcasm! The problem, and the beautiful thing about it, is that very few of the economic fraternity in our universities and banks, would even recognise it!

  36. I have 2.5 properties too and am a politician.

    They didn’t mention their pension fund either which is property based.

    They seem to have accepted what I told them a year ago that this is not a political problem. Even fake socialists and fake georgists are in denial about it

    They are still trying to scapegoat by focusing on those best at it. When the deeper cause is the family home owner and it’s psychological impact individually

    Plus ca change. They talk about senators as though this were something new. But this is still ancient Rome. And when in Rome etc etc. To complain is to planet save.

    They still prophesy falling house prices but as we keep saying they NEVER EVER EVER EVER fall relative to all else so the pollies are wiser than them.

    The pollies are simply the best at doing what everyone else wants and everyone else especially the jealous here complain when they can’t have their sweets.

    Then as if the ignorance had not sunk to new depths they timidly throw in a land value tax next to a bunch of other consistently proven failed policy not to mention the ultimate failure to observe history showing an lvt always brings carnage to a world in denial of it.

    The problem goes far deeper to a place where even the best are too timid to go. To the psyche. That timidity makes the best of us the worst of us. The world’s number 1 danger is us.

    I’m off to do more productive sport on twitter with the gaza and tax avoidance planet savers