Lifestyle Inflation

The benchmark for a "liveable" or "starter" home has drastically shifted. A simple 3-bedroom, 1-bathroom house was once the norm; now, 4 bedrooms, 2 bathrooms, multiple living areas, and luxury features like a butler's pantry or home theatre are standard, even in volume builds. These are not custom designed mansions; these are the types of homes you see when you are looking to buy or build your first home.  The idea of sharing a bathroom in an old 3-bedroom house is archaic and border lining a human rights violation.

Having a butler’s pantry is certainly out of my budget. Not because I couldn’t get the loan approved to upgrade, because I don’t want that kind of debt. There is a difference between our budget and what we can afford however, we have started using these terms interchangeably as if they are the same thing.  I have no butler’s pantry, no theatre, no study but I love what we do have. I said to my husband recently, we could have twice the house we do now with a large mortgage, we both said, ‘it’s not worth it’.

We are younger than even the average first home buyer and we have been homeowners for about 10 years. We didn’t have scheme spots or grants when we bought (only build grants were available). We saved a deposit while renting and paying for childcare. However, we rented the kind of houses that you would now knock down and rebuild, even though it’s perfectly liveable with a little maintenance.   

As long as we stored our wooden furniture in the shed away from the termites (there was no room for a dining table anyway) and didn’t use the front deck due to it being so unstable, we were fine. The stove top had 2 out of 4 burners working (thank goodness) and the oven seemed menopausal with its symptoms. You also couldn’t use the back yard (which was mainly just a courtyard) due to old paving that moved so much it was very uneven.

Now I’m not saying we loved the house, in fact, we hated it so much that we saved our deposit like crazy. But we both worked full time so there wasn’t much time we spent in the house. Something people seem to forget when deciding what they need in a rental. We didn’t go out to dinner, we didn’t order takeaway and we didn’t invite people over (due to the state of the house) for the 2 years that we lived there. When the landlord decided to up the rent, we were ready to buy. Obviously, there was savings we had from previous years, but this 2 years of living cheap and saving hard made all the difference. We bought an entry level house in a low social economic area. This house was the best house I have ever lived in. It was considered a simple 4-bedroom, 2-bathroom, 2 car garage that was about 8 years old. It was incredible. It needed a fresh coat of paint, new flooring and a few things fixed but we saved up and waited until we could afford to do the work. In fact, we had those patchy walls and worn carpet for 5 years. Most first home buyers want everything perfect right away. We were realistic that we were raising young children and perfectly painted walls may not be the best investment.

At the time, people stuck their nose up at the location, although the house itself was great, not amazing, not a dump. However, it was widely considered a starter home. Fast forward a few years and this area is no longer affordable. People much older than me say they never had a chance due to the struggles of our generation. They did, they made different choices. And there's nothing wrong with that, buying a home may not be a priority, but you can't have everything and need to decide if your lifestyle or home ownership is more important. Even now, I see young people achieving this much younger than we did, and I also see people who have been living with their parents rent free for years and still can’t save a deposit. The housing market is hard and needs to be addressed, but our choices are more powerful than some people realise.

This next generation seemed intrigued by the idea of tiny homes. These dwellings have major issues with council and the ability to occupy them long-term. We need to land somewhere in the middle.

At the end of the day, developers build what people will buy. If buyers continue to demand three bathrooms and a butler's pantry in their first home, that will remain the market standard and the price floor will continue to rise. We need to adjust our expectations, swallow our pride, and make more of what was considered entry level homes 50 years ago. Simple, quick to build, cheaper options. Not townhouses with 3 bathrooms. Why do they need 3 bathrooms? We used to have outhouses with redback’s on the toilet seat. Why is going downstairs to a shared bathroom where we now draw the line?

Profit margins are also on the line if we were to simplify our homes, however, tax breaks for developers may help offer incentives. People don’t realise how much money goes into tax and ‘red tape fees’ in new homes. Profit margins need to compensate, and its understandable developers go for higher margins.