IT’S TIME TO STOP OUR WHINGEING BETTER OFF NO W THAN 30 YE ARS AGO
IT WAS 1988, Christopher Skase and Alan Bond were still doing business, Kylie Minogue was riding high in the charts with I Should Be So Lucky and it took the average worker more than two weeks to earn enough to buy a video recorder.
Turns out we are the lucky ones today, according to leading demographer and social researcher Mark McCrindle, who has done a cost-of-living comparison that shows a whole range of essentials, household goods and luxuries are much more affordable for today’s Australians than they were 30 years ago.
“This generation does not know how good they have got it,” he said. “Things are not as dire as we sometimes think.”
Three decades ago, when Australians were celebrating the bicentenary of the arrival of the First Fleet and Brisbane was preparing to host World Expo 88, the average weekly income was $465. Today it is $1544. It was harder to find a job in the aftermath of the 1987 stock market crash, with unemployment running at 9.2 per cent then, compared with 6 per cent now.
A new Holden Commodore cost $20,014 – 43 weeks of average earnings. Today, the equivalent will set you back $33,690, taking just 21.8 weeks to earn.
It’s even cheaper in real terms to fill the car with fuel. The price of petrol has risen 2.3 times over the period, while wages are up 3.3 times.
A Commodore 64 computer was priced at $786 – eight days of income – compared with the nine hours it takes to earn the $379 needed to buy a Lenovo notebook now.
The price of a return airfare to London has dropped from $1300 in 1988 to $1188, taking four days’ pay now instead of 14.
“We often talk about the cost of living and how expensive it is now. But the staples of life, electronic and household goods are far lower today than ever before,” Mr McCrindle said.
THIS GENERATION DOES NOT KNOW HOW GOOD THEY’VE GOT IT
The major exception to the trend is the soaring cost of housing. The average house price in Brisbane is now $531,248 – 7.5 times the $71,000 in 1988 – as the population doubled to 2.4 million over the three decades. However, a trip- Time to earn 2018 price ling of wages, lower taxes and record-low interest rates mean Queenslanders are still better off overall.
Mortgage repayments on the average-priced Brisbane house are equivalent to half the average annual income – Timeme to earn slightly below the 54 per cent in 1988.
Gene Tunny of Adept Economics said: “It is much harder to save up a deposit than it once was. While a typical deposit was once 40 per cent of after-tax income, it is now around 85 per cent. House prices have grown much faster than incomes since 1988, so young people are definitely right to complain about housing affordability. We can’t expect interest rates to remain this low for ever and homebuy- ers should consider whether they could afford mortgage repayments at higher interest rates,” Mr Tunny said.
Mr McCrindle said the biggest winners are those who got into the property market before the price boom.