There is an 11-year wait for public housing in Sydney?

That was my piece of interesting information, from this story in something called the Fairfield Champion.

I don’t place great importance to human interest stories (these count, statistics students, as anecdotal evidence, not actual evidence. When people refer to “proof by evidence”, make sure they aren’t actually bulking up anecdotal evidence). This one is fascinating, though: Iraqi immigrants, handyman husband never had a full-time job in their 11 years in Australia (I can imagine Howard voters loving that one), but offered a fully-leveraged mortgage, which they’ve finally run out of chances to keeping paying. Husband has left, photo of wife with 3 kids, evicted at the end of the month.

Like I said, what really hit me was the throw-away line about the wait for public housing. Bloody hell. Those who remember the days of the Thatcher’s “right-to-buy” homeless families (not me, no) will pause at that one. Big shortages of public housing does not portend well when we’re expecting an increasing number of evicted bankrupts suddenly entering a rental market that is already at historically low vacancy rates – irrespective of their awful credit rating.

Continuing this latter point, the actual story I first spotted (much earlier today, but I had to go to the bank. Post-“9/11” laws here mean I can’t just get on the internet to wire money to Australia – like I can in every other country. It’s a more convoluted, and far more annoying, process).

There were a record 1400 auctions in the region in the year to March 31, nearly double the number in 2005, Australian Property Monitors figures show.

When I saw the heading for the story (“Surge in families forced to sell their homes”) I was more than a little skeptical, but I reckon that qualifies. Evidence that these were so-called ‘distressed sales’ (selling because the bank is foreclosing and you lose the house to pay off the mortgage – the woman in the story at the top had tried this already) is in the prices, as much as the numbers – tens of thousands of dollars below averages in other areas/regions/times (the woman in the story at the top had failed because the offer she got did not satisfy the bank. So she doesn’t ‘just’ lose her house, she goes all the way to bankruptcy (I’ve mentioned this trend developing).

This is a phenomenon seen here in the US, also – something I spotted Bloomberg (wireless) calling the Housing Recession – home ownership dead while the economy at large still ‘goes along’, as it were. Sydney is about doing that, too.

The number of bankruptcies and debt agreements – which are binding on defaulters – have doubled in some parts of Sydney since 2000. There were 5250 personal insolvencies registered across the city between June and February, suggesting this financial year’s total could reach nearly 8000 compared with just 4544 in 1999-2000. Parts of western Sydney have been hardest hit, with an increase in personal insolvencies of 99 per cent in Blacktown and 70 per cent in the outer west.

But the rise in bankruptcies and debt agreements is not confined to the urban fringe. Sydney’s inner west experienced an increase of 83 per cent over the past six years and there was a 74 per cent rise on the northern beaches and 60 per cent in the eastern suburbs.

The credit agency Dunn and Bradstreet released figures last week showing those defaulting on debts were getting younger, and failing to pay off smaller amounts. Half the defaulters referred to the agency, which monitors creditworthiness, were younger than 32. NSW residents were most likely to default on debts and had the largest average value of unpaid debt. Many consumers are failing to pay phone, internet and pay TV accounts.

Score. Wouldn’t it be amusing if that desalination plant comes online just when the number of people buying/occupying houses is declining because of this mess?

Funnily enough the call to end easy credit continues. Which is fine. I’ve said before this is all happening because people who shouldn’t, on paper, own homes were given mortgages anyway. Chickens are pretty much coming home to roost in the house the bank just took away from them, and it isn’t fair. I’d say more needs to be done than close the bank door after the horse bolted (it is “fun with metaphors” day). Like build public housing and a statue for Jack Lang (the Australian politician, not the French one).

Sadly, like the US, we still need consumer spending to fuel (or prop up, depending upon your mood) our economy, too. Take away the unsecured lending that pays for that and a real recession is on the offing. Leave the credit there and you risk a bigger one anyway.


2 comments so far

  1. Kate Sullivan on

    A human interest story it may be, but the case of the Iraqi woman being forced out of her home in Fairfield is not isolated … She was the only one who was desperate enough to come forward and speak to the media about it.
    Everyday we hear about families who can’t find homes and can’t get rental properties because they don’t have jobs etc. But what is being done about it? Nothing.
    If you are not in distress, if you have a roof over your head and you’re not dying then the likely hood of getting the Department of Housing to stand up and take notice is slim to none.
    Funnily enough, less than a week after this story came out the DoH found her a home. A miracle?
    If I have to splash stories like this across the paper every week to help each individual family get a helping hand then I will. The Government is sure as hell not doing anything about it.

  2. zooeygoethe on

    I wouldn’t be surprised (and it was a good article – thank you for leaving a comment here). The warning for students of economics still stands. The balance you have to strike you will have to learn for yourselves (and marry to your political sympathies).

    I agree, obviously, with your thesis, vis. people securing rental accommodation at all, let alone with families, non-stable income, previous defaults, etc. Being a single mother of three at all, let alone an Iraqi one in today’s Australia, is to be a long way behind the proverbial 8-ball. And it isn’t fair.

    As I wrote, there’s clearly likely to be an increasing gap in housing in Sydney, and only the government has the werewithall to fill it – if they only will. Given Sydney’s attitude about housing (particularly at and around Olympics time), I don’t fancy our/your chances.

    I’m glad something was sorted out for the family in your story. Unfortunately I see, like Billy Bragg, a new time when the great and the good are giving way to the greedy and the mean.

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