The house you prefer … or the house you can afford?

by Chris Lang on June 23, 2011

Dream Home A recent video report on ABC News says there’s a shift in the housing preferences of Australians. The Australian Dream is no longer a detached house set on a large block of land – instead, nowadays most people prefer an apartment or a townhouse just outside the city center.

Well … I don’t buy it. And here’s why.

Don’t get me wrong – I don’t intend to question how truthful the study is. OK, so they went out and asked 700 people about the kind of house they would buy. But putting myself in those respondents’ shoes, if they were to ask me “Chris, what sort of house would you buy?” – the scope of my answer would lie within my means. And I would tell them about the house that I can afford now – but not about my dream home.

You see, dreams are sort of hard to kill, as for many of us they are an escape from reality. People have always dreamed about things that are just beyond their reach, about something that they will have one day. I bet the house you picture as something you can be proud of, something you would totally love to own, is different from the house you live in now. And that’s just fine, because we all need to have a goal, something to work towards and to look forward to.

Take me for example. I would absolutely love to live in a new, four bedroom house built to the new standards, with a big back yard, a study, a large sophisticated kitchen and all that. The first place I ever owned was a 2-bedroom apartment on the 6th floor of a 9-story building. Does it sound anything like my dream house? Not really, but it was all I could afford at that stage.

Right now the reality is such that less and less people can afford a detached house on a large block of land. But should housing become more affordable, we will see a genuine proof that the majority of people still want that big house on a large block of land. And the way property market is behaving, we may be headed in the right direction: take a look at this house that no one will buy, even after a 43% drop in the asking price. Initially advertised for 700K it is now offered for 400K, but still no buyer in sight. Admittedly this is an extreme example, and you won’t find 40% discounts widely available, but 10% discount is becoming much more common, so there is hope.

And now let me hear from you – what is your personal Australian Dream?

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