We hear a lot about Australia’s property bubble. Prices are rocketing up and the media is all over it.
Those stories are mainly about Sydney and, to a lesser extent, Melbourne. In those cities, auctions are a bloodbath.
The reality of the housing market is very different outside capital cities – but we don’t hear so much about them.
There must be houses in this country that cost a lot less than the average, right? That’s how averages work.
I went looking for them and I found examples like this house in Warren, NSW (right).
There are some cheap “houses” out in the bush that might take even more getting used to.
That might not be an option if you are claustrophobic but there are cheap houses listed for sale that are even less liveable.
It’s only $25,000. You might need some more fittings, but no need to invest in fly screens. There are no windows. But living underground is what Coober Pedy is famous for. When in Rome!
Even the real estate agent calls it derelict. The absence of interior shots in the listing tells the story.
I thought $20,000 or $25,000 for a place to live was as low as you could go.
Picket fence and all, for just $12,000.
It is partly a caravan. Half of it is a permanent structure though so I think it counts.
$12,000 seems mighty cheap. The fees on a mortgage that small would be a massive fraction of it.
To put this in context, $12,000 is just two per cent of the average Australian house price. The average worker makes $12,000 in eight weeks (before tax).
So this place is a bargain. For a while I fantasised about living in sunny Queensland and never having to work again. Then I realised I wasn’t asking an important question.
Here, I’m sorry to say, this story gets serious.
Why, I began to wonder, is housing so cheap in regional Australia?
The answer is we live in a country where wealth is not evenly distributed. In the cities, there are more rich people than you can froth a macchiato for. In the country, wealth is harder to come by.
In Sydney, the most recent data shows average wages of $57,000 – nearly 25 per cent higher than in the rest of NSW ($46,000).
In Bundaberg, where our very cheap home is found, average earnings are $41,000.
The decline of Australia’s agricultural sector and the boom of our service industries means kids born in regional areas will probably move to the cities.
The alternative is a life of fewer opportunities. Statistics show 13.1 per cent of people in rural and regional Australia live in poverty – a higher rate than in the capital cities. (That figure takes the cheaper cost of housing into account.)
This is a country of extremes – not just of drought and flooding rains, but of wealth and poverty.
It’s easy sometimes to forget about the poverty. I’m somewhat ashamed to have started writing this piece thinking only of the amusement value of a cheap house, and not at all about the conditions that explain it.