‘I would be happy if prices came down’: the older Australians wanting house prices to fall for their kids’ sake

Older Australians who bought their first homes when property was a modest purchase are now watching a steep decline in affordability and urging a reversal for the sake of younger generations. Pete Muskens, a 71‑year‑old retired architect from Melbourne, bought a terrace house in the early 1980s for about $30,000 – roughly three times the average annual wage at the time – a price point his two adult children consider unattainable. Similarly, retired researcher Charlie Bell purchased a Canberra home in the mid‑1980s for less than three times his income, while marketing manager Richard Jones secured his first property in the early 1990s at about four times his salary. All three now lament that today’s housing market has turned homes into investment assets, pushing many of their children and grandchildren into prolonged periods of living at home, delaying family formation and eroding the traditional pathway to independence.

The shift in housing dynamics stems from policy decisions and market forces that decoupled prices from wages beginning in the late 1980s and accelerating through the 1990s and early 2000s. A pivotal moment was the Howard government’s halving of the capital‑gains‑tax rate, which made residential property highly attractive to investors, while successive state and federal administrations failed to address chronic supply shortages. Recent Labor reforms that tightened negative‑gearing and capital‑gains‑tax concessions were intended to curb investor incentives and re‑balance the market, but they arrived amid rising interest rates and a tepid economy that have already forced prices down. Sydney’s market, for example, has fallen about 7 % from its early‑year peak, with the steepest declines in the high‑end segment, while Perth and Adelaide remain comparatively stable. The reforms have been hailed by Anglicare Australia as “the most significant shift in the taxation of wealth in decades,” aiming to prevent an emerging “inheritocracy” where home ownership depends more on parental wealth than individual effort.

Reactions to the price pullback have been sharply divided along political lines and across generations. The Coalition has pledged to repeal Labor’s property‑tax changes if it returns to power, and One Nation is calling for a wholesale overhaul, arguing that any reform could further destabilise the market. Older homeowners like Muskens and Bell, while acknowledging that the reforms may reduce their own asset values, express willingness to accept modest losses if it eases entry for their descendants. Bell summed it up: “I would be happy if prices came down – I would lose a bit, but it would make it easier for my kids and grandkids to buy houses.” Meanwhile, younger adults such as Jones’s children, despite strong education and employment prospects, are abandoning home‑ownership aspirations, with one even contemplating overseas relocation to escape Australia’s high costs. The ongoing debate highlights a broader societal concern: whether Australia can reshape its housing system to restore affordability and ensure that home ownership remains a realistic milestone for future generations rather than a privilege reserved for those inheriting wealth.

⚡ Effects Interpreter

🌍 Effects for your country