[LINK] Open Letter To Joe Hockey

[Andy Farkas]

<https://year13.com.au/open-letter-to-joe-hockey/>

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Dear Joe,

I just wanted to touch base with you regarding your comment that young
people are able to enter the property market if they just "get a good
job that pays good money."

I just wanted to ask you how one might go about this?

Are you going to be reviewing all the current Awards that are in place
to ensure that most jobs pay "good money"?

Are you going to be creating hundreds of thousands of new jobs that,
under your Awards, pay over $100,000 per year?

Apologies if I have missed this fantastic news, but as someone working
in 2 senior HR roles, I believe I would have known about this so that I
could pass the message on to some very tired, over qualified employees
who currently fall under various Federal and State awards and are being
paid between $18 to $25 per hour.

Are you aware of what the average Australian wage is?

Are you aware of what the average Australian mortgage in Sydney is?

Are you aware of the first-home buying process?

Just in case these facts and figures aren't available to you, I thought
you might be interested.

The average weekly wage according to the Australian Bureau of Statistics
on 1st January 2015 was $1,128.70, or $58,692.40 before tax. This means
a take home amount of about $904.00 per week.

The median house price in Sydney, according to the Domain Group Housing
Price Report, as of March 2015, was $914,056.

Not sure if you know how first home buying works at the moment, but you
normally need a deposit of about 20%. This is to pay for the Stamp Duty
(which is a State Tax you must pay every time you buy a property), and
also to assist in the approval process so that you don't need to pay
Lenders Mortgage Insurance.

So in this instance, the first home buyer would need about $182,811.00
saved to purchase a house that is the average price in Sydney.

So to go out and get one of these "good jobs that pay good money" I
assume these young people you speak of would need to go to university
first.

On average, it takes about 3 -4 years to get a degree, so if a young
person goes to University straight out of school, they can expect to
finish their course and be ready for the workforce at about 21, with a
HECS-HELP debt of over $20,000. To make this a bit easier for you to
understand, let's say there is a young person named Joe Junior who has
done just this.

If Joe Junior is extremely lucky, and is up there with the best of the
graduates from that course and that year, he will get a job straight out
of University paying usually under the average wage.

However, lets just be extremely generous here and say that Joe Junior
got a job and was on the national weekly take home wage of $904 per
week.

Joe Junior needs to only save every single dollar worked for about 4
years to save his $182,811 deposit for their first home. Thank you, Mr
Hockey, for throwing in that $7,000 first home owner grant too - that
meant Joe Junior could get into his first home 8 weeks earlier!

Just a quick side note, this example does not take into consideration
the rising house prices, or Joe Junior's HECS-HELP debt that he obtained
from getting his degree to get one of your so-called "good jobs".

Joe Junior is now 25 (not so junior anymore), has been living at home
with his parents this entire time and has not been able to spend a
single dollar on any bills, board or holidays or public transportation.
He also can't afford a car or petrol for a car but then again "poor
people don't drive cars". Oh wait, Joe Junior isn't a poor person - he
has a "good job that pays good money."

Luckily Joe Junior's parents have been happy to drive their little Joe
Junior to and from work every day and provide free housing, clothing,
medical expenses and also provide the food for his breakfast, lunch and
dinner each day.

So finally Joe Junior has saved his $182,811 deposit (of which only
about half will go towards his mortgage due to the stamp duty cost), and
can now purchase his first home, with a mortgage of about $822,650.00.

According to the Commonwealth Bank's online mortgage estimator, the
repayments for a mortgage of this amount are $1,073.00 per week over 30
years.

So hopefully Joe Junior's average weekly wage of $904.00 has gone up
enough to cover the cost of the mortgage.

Joe Junior has been applying for these "good jobs hat pay good money"
that you speak of (I assume by "good money" you mean more than the
average wage as you have just seen it is not even enough to cover the
cost of the average house prices' mortgage in Sydney), but hasn't had
any luck as yet. He needed to stay in the same job post university to
demonstrate to the bank job stability so that he could purchase his
first home. So he only has a degree, and experience in the one job, one
industry, and there are just not that many jobs out there paying "good
money."

Joe Junior now also can't wash his clothes, eat food, or get to and from
work as he no longer lives with his parents, so getting one of these
"good jobs" is even more difficult.

So Joe Senior, are you really aware of all the facts and figures when
you says things like buying your first home is "readily affordable" to
young people?

Just slightly confused as to what you were thinking when you said these
words at the media conference in Sydney.

Looking forward to another one of your politically correct, direct and
well thought out responses.

Regards,

Another baffled Australian

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-andyf