2015 Financial Survey Predictions For OZ
Dec 18th 2014, 12:01 am
#16
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Re: 2015 Financial Survey Predictions For OZ
It would require a complete change of mindset for Australia to come anywhere close to the German reality.
For starters Germany has rent protection laws which would hardly sit well on the shoulders of what must be said are often greedy, market focused , out for a quick buck and loathe to put much in Australian land lord.
The renter is king in Germany and besides having sound protection of tenure has the knowledge that rental charges can only be raised by minimal amounts, must be fair , all things a little alien in Australian present day context.
A reason no doubt Germans do not see a lot of sense being straddled with large mortgages and spend their money on other more enjoyable aspects of living.
Not forgetting of course, Germany has not been hammered by massive price rises. In fact Germany outside of some of the main cities has top rate houses, very well built for low prices.
I don't see any possibility of Australia joining Germany in that anytime soon.
For starters Germany has rent protection laws which would hardly sit well on the shoulders of what must be said are often greedy, market focused , out for a quick buck and loathe to put much in Australian land lord.
The renter is king in Germany and besides having sound protection of tenure has the knowledge that rental charges can only be raised by minimal amounts, must be fair , all things a little alien in Australian present day context.
A reason no doubt Germans do not see a lot of sense being straddled with large mortgages and spend their money on other more enjoyable aspects of living.
Not forgetting of course, Germany has not been hammered by massive price rises. In fact Germany outside of some of the main cities has top rate houses, very well built for low prices.
I don't see any possibility of Australia joining Germany in that anytime soon.
When it comes to housing, you pay your own mortgage or you pay someone else's. This is true everywhere whether you like it or not - that's the way it is
The whole of the western world is facing a demographic time bomb - the old are not dying out. Germany, like most of western Europe, does not have a private pension culture. Pensions are provided by the state. The problem with this model is that now that there are more older people, there will not be enough money. The pension pot is not growing like it is in Australia and the UK, it is being spent now. If people own their own home (and the time they retire, most do as they have paid off the mortgage), they have security and do not have to rely on the state. Housing and pensions are inextricably linked. Most in Germany will not have this option and if the government cannot provide, what then? Yes they can increase taxes but they are already high so if they do they could crash their economy. This is a great article that I used in a uni economics assignment - the OECD graph is telling:
UK sits pretty amid Europe's demographic timebomb – Telegraph Blogs
Australia's super system has many flaws but it is now bigger than GDP and growing, if not accelerating. UK is in a similar situation. As super grows, the amount that our government will need to spend on pensions will fall - the complete opposite to the situation Germany faces
I love Germany and could easily live there. It is a cultured, pleasant, fun place with a great lifestyle and is relatively inexpensive. But when it comes to home ownership and pensions, Australia is ahead of Germany
Last edited by Amazulu; Dec 18th 2014 at 12:04 am.
Dec 18th 2014, 12:37 am
#17
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Re: 2015 Financial Survey Predictions For OZ
There's no bigger fan of Germany than me but on this, as a society, they have got it fundamentally wrong
When it comes to housing, you pay your own mortgage or you pay someone else's. This is true everywhere whether you like it or not - that's the way it is
The whole of the western world is facing a demographic time bomb - the old are not dying out. Germany, like most of western Europe, does not have a private pension culture. Pensions are provided by the state. The problem with this model is that now that there are more older people, there will not be enough money. The pension pot is not growing like it is in Australia and the UK, it is being spent now. If people own their own home (and the time they retire, most do as they have paid off the mortgage), they have security and do not have to rely on the state. Housing and pensions are inextricably linked. Most in Germany will not have this option and if the government cannot provide, what then? Yes they can increase taxes but they are already high so if they do they could crash their economy. This is a great article that I used in a uni economics assignment - the OECD graph is telling:
UK sits pretty amid Europe's demographic timebomb – Telegraph Blogs
Australia's super system has many flaws but it is now bigger than GDP and growing, if not accelerating. UK is in a similar situation. As super grows, the amount that our government will need to spend on pensions will fall - the complete opposite to the situation Germany faces
I love Germany and could easily live there. It is a cultured, pleasant, fun place with a great lifestyle and is relatively inexpensive. But when it comes to home ownership and pensions, Australia is ahead of Germany
When it comes to housing, you pay your own mortgage or you pay someone else's. This is true everywhere whether you like it or not - that's the way it is
The whole of the western world is facing a demographic time bomb - the old are not dying out. Germany, like most of western Europe, does not have a private pension culture. Pensions are provided by the state. The problem with this model is that now that there are more older people, there will not be enough money. The pension pot is not growing like it is in Australia and the UK, it is being spent now. If people own their own home (and the time they retire, most do as they have paid off the mortgage), they have security and do not have to rely on the state. Housing and pensions are inextricably linked. Most in Germany will not have this option and if the government cannot provide, what then? Yes they can increase taxes but they are already high so if they do they could crash their economy. This is a great article that I used in a uni economics assignment - the OECD graph is telling:
UK sits pretty amid Europe's demographic timebomb – Telegraph Blogs
Australia's super system has many flaws but it is now bigger than GDP and growing, if not accelerating. UK is in a similar situation. As super grows, the amount that our government will need to spend on pensions will fall - the complete opposite to the situation Germany faces
I love Germany and could easily live there. It is a cultured, pleasant, fun place with a great lifestyle and is relatively inexpensive. But when it comes to home ownership and pensions, Australia is ahead of Germany
The future of super in Australia has some very longer term question marks. One thing for certain it will not continue as it is at present.
Government further down the line more than likely to dip into it and other barriers to access will likely make benefits less certain.
You follow the official line which has some merit but is also to scare people, saying that things are being scaled back in Germany, so costs are considered but still a great country to do business in.
I'm not one that necessary believes a lot of the chatter written in usually right wing opinion pieces on the feasibility of the German system. Like I say trims and tucks have been made and will certainly be further, one Euro jobs for unemployed an example, but the thrust of German politics still prefers the non Anglo approach and to maintain a reasonable fair society to most if not all.
As for population yes it is in decline like Japan, but immigration is high and ever increasing. Germany dwarfs Australia ten times in refugee intake and there is ever increasing immigration from Spain and Greece, Portugal and Italy, in order to escape those countries crisis.
That's before we get into the East European numbers over the years.
On top of that a great and challenging education system that actually turns out people with knowledge in their field.
Still a country pretty much on top of its game and a magnet for many.
Dec 18th 2014, 12:50 am
#18
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Re: 2015 Financial Survey Predictions For OZ
This is true, but outside of superannuation, Australia offers very very few paths to tax efficient savings. It's very difficult to build wealth growth when the government is reaching in taking their share.
Term deposits, for example, after tax and inflation, very often leave you behind the game. Savings accounts are taxed at your marginal tax rate. There are very few [legal] avenues to develop effective wealth growth here. It's small wonder that people see property as a viable alternative.
Super is all well and good, but the government see this as something that they can tinker with and change at will, and your money is locked away until you reach preservation age, which can also be changed on government whim.
If they current mob drop the company tax rate by the proposed 1.5%, then insurance bonds will become a more interesting tax efficient investment, but your money is still locked away for at least 10 years...
Successive australian governments keep banging on about how we need to pay for our own retirements, but they don't provide us with a sensible tax environment to allow us to build the wealth we need. Hence people end up investing in property, as once it's paid off, it can still provide a healthy rental income while you're in old age.
S
Term deposits, for example, after tax and inflation, very often leave you behind the game. Savings accounts are taxed at your marginal tax rate. There are very few [legal] avenues to develop effective wealth growth here. It's small wonder that people see property as a viable alternative.
Super is all well and good, but the government see this as something that they can tinker with and change at will, and your money is locked away until you reach preservation age, which can also be changed on government whim.
If they current mob drop the company tax rate by the proposed 1.5%, then insurance bonds will become a more interesting tax efficient investment, but your money is still locked away for at least 10 years...
Successive australian governments keep banging on about how we need to pay for our own retirements, but they don't provide us with a sensible tax environment to allow us to build the wealth we need. Hence people end up investing in property, as once it's paid off, it can still provide a healthy rental income while you're in old age.
S
The inability the claim the OAP due to failing the asset test comes straight to mind.
The yield raised during the rental duration minus costs around mortgage, rates, water, repairs, times of standing vacant. Initial stamp duty charges then the inability to claim a pension on top of that all need to be factored in.
I fully agree with comments on super. Heavily biased at the moment towards those near the time but longer term this will not be an option.
Another loss for younger people as if they handy enough already to contend with.
Dec 18th 2014, 12:55 am
#19
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Re: 2015 Financial Survey Predictions For OZ
I forgot to mention. 40 Billion dollars super tax concessions cost yearly.
Unevenly distributed and unlikely to be able to continue too far into the future.
Although what government will take the bit between the teeth at the cost of losing senior voters?
Unevenly distributed and unlikely to be able to continue too far into the future.
Although what government will take the bit between the teeth at the cost of losing senior voters?
Dec 18th 2014, 12:59 am
#20
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Re: 2015 Financial Survey Predictions For OZ
I'd sooner have the German certainty of a pension of considerable worth than what they pay out here as a pension which is really a more an income support or dole level of payment.
The future of super in Australia has some very longer term question marks. One thing for certain it will not continue as it is at present.
Government further down the line more than likely to dip into it and other barriers to access will likely make benefits less certain.
You follow the official line which has some merit but is also to scare people, saying that things are being scaled back in Germany, so costs are considered but still a great country to do business in.
I'm not one that necessary believes a lot of the chatter written in usually right wing opinion pieces on the feasibility of the German system. Like I say trims and tucks have been made and will certainly be further, one Euro jobs for unemployed an example, but the thrust of German politics still prefers the non Anglo approach and to maintain a reasonable fair society to most if not all.
As for population yes it is in decline like Japan, but immigration is high and ever increasing. Germany dwarfs Australia ten times in refugee intake and there is ever increasing immigration from Spain and Greece, Portugal and Italy, in order to escape those countries crisis.
That's before we get into the East European numbers over the years.
On top of that a great and challenging education system that actually turns out people with knowledge in their field.
Still a country pretty much on top of its game and a magnet for many.
The future of super in Australia has some very longer term question marks. One thing for certain it will not continue as it is at present.
Government further down the line more than likely to dip into it and other barriers to access will likely make benefits less certain.
You follow the official line which has some merit but is also to scare people, saying that things are being scaled back in Germany, so costs are considered but still a great country to do business in.
I'm not one that necessary believes a lot of the chatter written in usually right wing opinion pieces on the feasibility of the German system. Like I say trims and tucks have been made and will certainly be further, one Euro jobs for unemployed an example, but the thrust of German politics still prefers the non Anglo approach and to maintain a reasonable fair society to most if not all.
As for population yes it is in decline like Japan, but immigration is high and ever increasing. Germany dwarfs Australia ten times in refugee intake and there is ever increasing immigration from Spain and Greece, Portugal and Italy, in order to escape those countries crisis.
That's before we get into the East European numbers over the years.
On top of that a great and challenging education system that actually turns out people with knowledge in their field.
Still a country pretty much on top of its game and a magnet for many.
Super is getting massive. Currently around $1.8t (GDP is about $1.6t). It will be $5t in my lifetime. Yes it is a flawed system but it is going to provide things that the German taxpayer will have no choice but to provide
I don't care if Germany takes in more refugees. That's up to them and their taxpayers. I'm happy with the number we take. The less islam we have the better
Australia is a magnet for many people - one of the western world's great immigration destinations. Always has been. always will be
We also have a great eduction system. Yes, it could be better but it is already good. You don't get to be 12th GDP, 5th per capita GDP (Germany 18th), 2nd HDI (Germany 6th) with a shit education system
Germany is a great country and they get a lot right but on housing and pensions they haven't. Australia is ahead in these areas
2 top countries. Both have problems but both continue to basically get it done
Dec 18th 2014, 1:06 am
#21
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Re: 2015 Financial Survey Predictions For OZ
Nope read below. Different times and different market. We were not in bubble territory in 89.
You may recall the late 80's house price fall/crash in London. I do. It couldn't happen there they were saying in early 80's as well.
Australia cannot secure any sort of future through continued housing growth and flipping of houses to the few than can afford it.
You may recall the late 80's house price fall/crash in London. I do. It couldn't happen there they were saying in early 80's as well.
Australia cannot secure any sort of future through continued housing growth and flipping of houses to the few than can afford it.
Dec 18th 2014, 1:36 am
#22
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Re: 2015 Financial Survey Predictions For OZ
Loss of potential tax revenue is a load of old bollocks in many instances anyway. If the government taxed everyone at 75% and GST was 25% they would have loads more revenue wouldn't they. Or would they? probably not as the economy would have crashed
Lower taxes for everyone with no concessions would be a better system but will never happen given vested interests and governments caught up in the election cycle
Dec 18th 2014, 1:42 am
#23
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Re: 2015 Financial Survey Predictions For OZ
$550 million dollars alone were contributed to the NSW government alone this year due to housing sales tax. That state is now leader in growth rates with WA and QLD slipping as mining revenue declines.
Dec 18th 2014, 1:43 am
#24
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Re: 2015 Financial Survey Predictions For OZ
Your decision not to get involved of course but wrong to say pointless. The Australian economy is largely reliant on house price rises as a means of sustaining growth. Hence as the glue that is keeping things ticking over until a better idea can be found it is anything but pointless.
$550 million dollars alone were contributed to the NSW government alone this year due to housing sales tax. That state is now leader in growth rates with WA and QLD slipping as mining revenue declines.
$550 million dollars alone were contributed to the NSW government alone this year due to housing sales tax. That state is now leader in growth rates with WA and QLD slipping as mining revenue declines.
Party on Garth
Dec 18th 2014, 2:06 am
#25
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Re: 2015 Financial Survey Predictions For OZ
If you want people to save for their retirement then you have to give them incentives to do so. So tax relief it is. Asking people to save and taxing them less on these savings seems sensible to me
Loss of potential tax revenue is a load of old bollocks in many instances anyway. If the government taxed everyone at 75% and GST was 25% they would have loads more revenue wouldn't they. Or would they? probably not as the economy would have crashed
Lower taxes for everyone with no concessions would be a better system but will never happen given vested interests and governments caught up in the election cycle
Loss of potential tax revenue is a load of old bollocks in many instances anyway. If the government taxed everyone at 75% and GST was 25% they would have loads more revenue wouldn't they. Or would they? probably not as the economy would have crashed
Lower taxes for everyone with no concessions would be a better system but will never happen given vested interests and governments caught up in the election cycle
Lower taxes or flat taxes benefit only high earners. The days of lower taxes look to have passed their sale date. The onus will be on raising revenue not declining it to sustain services people have come to expect.
Dec 18th 2014, 2:09 am
#26
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Dec 18th 2014, 2:30 am
#27
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Re: 2015 Financial Survey Predictions For OZ
I rarely get involved in house price discussions on here - and haven't for many years
If you want to discuss this topic then enjoy but I won't be involved
That's all I was saying FFS
Dec 18th 2014, 2:34 am
#28
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Re: 2015 Financial Survey Predictions For OZ
It seems to me vested interests are what is keeping the gravy train afloat at the moment. Be that the present benefiting of older, with higher income assets super concessions costing big bucks or the other rich or middle class legal rorts .
Lower taxes or flat taxes benefit only high earners. The days of lower taxes look to have passed their sale date. The onus will be on raising revenue not declining it to sustain services people have come to expect.
Lower taxes or flat taxes benefit only high earners. The days of lower taxes look to have passed their sale date. The onus will be on raising revenue not declining it to sustain services people have come to expect.
Germany has got it wrong on pensions
Actually there is a solution to this problem for Germany - mass immigration of younger people. It will mainly be from 3rd world, predominantly islamic countries
Have fun with that!
Dec 18th 2014, 4:04 am
#29
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Re: 2015 Financial Survey Predictions For OZ
Far removed from yields or a roof over the head. Thus of grave importance to national wellbeing if not handled correctly. Nothing more meant and nothing personal.
Dec 18th 2014, 4:07 am
#30
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Re: 2015 Financial Survey Predictions For OZ
As I said no problem opting out. Just that housing holds far more importance being the mainstay of the present day economy. May as well not discuss Australia's economic future under the circumstances it being that important.
Far removed from yields or a roof over the head. Thus of grave importance to national wellbeing if not handled correctly. Nothing more meant and nothing personal.
Far removed from yields or a roof over the head. Thus of grave importance to national wellbeing if not handled correctly. Nothing more meant and nothing personal.