From Melbourne:
The house on Newry Street, Fitzroy North no longer looks like what it once was. The bathhouse that was tipping over is long gone, the cracked plaster replaced, the outhouse dismantled and rebuilt by the hands of a 24-year-old who could not get a bank loan and so sold his car instead. Neil Robertson paid $7,500 for his first home in 1972 and walked away from his second, four decades later, with $1.5 million. He is the first to say he was lucky. He is also the first to admit the path he walked no longer exists.
Robertson's story, reported by the Sydney Morning Herald, is not exceptional for his generation. It is, in fact, entirely ordinary, and that ordinariness is precisely what makes it so striking to anyone born after 1980. He bought, he fixed, he sold, he bought again. By 30 he had no mortgage. The decisions were rational, measured, and now largely beyond reach for millions of Australians trying to do the same thing.
The aspiration itself, of course, runs far deeper than any single generation. Monash University urban historian Emeritus Professor Graeme Davison traces the desire to own a home in this country to the mid-1800s, when Australia was, by global standards, unusually democratic. In Britain, only property owners could vote. Here, the link between a roof over your head and your standing as a citizen was woven into the culture almost from the beginning. By the end of the 19th century, Melbourne's home ownership rate sat at roughly 40 per cent and Sydney's at around 30 per cent, rates the SMH notes were comparable only to a handful of American cities and far above England, where ownership in most cities barely reached 5 per cent.
The postwar decades cemented what had only been a tendency into something closer to a national religion. Robert Menzies, Australia's longest-serving prime minister, presided over a housing boom driven by deliberate government policy. The logic was partly ideological: people with mortgages and gardens, as writer Peter Mares explains in his book No Place Like Home: Repairing Australia's Housing Crisis, were thought to be moderate citizens with a stake in the status quo, less likely to be drawn toward radical political ideas. Cold War thinking, in other words, helped build the suburbs.
At its peak, the Reserve Bank of Australia confirms home ownership in Australia held broadly stable at around 70 per cent from the 1960s onward, boosted by government construction programmes that at their height saw nearly one in five dwellings built by governments themselves. Independent economist Saul Eslake, cited in the SMH reporting, notes that from the end of the Second World War until the late 1970s, house prices remained remarkably stable at about three-and-a-half times average weekly earnings, even as Australia's population grew faster than it has in recent decades. Supply, not demand, was the governing philosophy.
Then the architecture of policy began to shift. In 1963, Menzies introduced the first home owners' grant. The instinct was generous; the long-term effect, according to Eslake, was to redirect government energy from building homes to subsidising buyers. Decades of federal and state policy from both sides of politics followed the same template: stimulate demand, neglect supply.
The sharpest turn came in 1999. The Howard government, acting on a Treasury recommendation, introduced a 50 per cent discount on capital gains tax for assets held longer than 12 months. Australian Housing and Urban Research Institute analysis shows the change made it far more attractive to hold property for capital growth rather than rental yield, and combined with negative gearing rules that allowed investors to deduct losses against their ordinary income, it turbocharged investment in established dwellings. Eslake argues the effect was to transform negative gearing from a tax deferral strategy into a mechanism for permanently reducing tax obligations.
The human consequences of those shifts are not hard to find. Allison Vallance, 61, a former horticulturist, bought a run-down three-bedroom house in the Sydney suburb of Eastwood in 1985 for $96,000, having begun saving 20 per cent of her $90-a-week wage at age 16. She made sacrifices, forgoing holidays and new cars, sharing backyard barbecues with friends in similar circumstances. One of her adult sons has since bought a house near Newcastle. The other has saved a deposit but told her plainly that Sydney is beyond him.
Data from the Australian Bureau of Statistics gives that story statistical weight: Baby Boomers aged 25 to 39 in 1991 were three times more likely to own their home outright than Millennials of the same age in 2021. Research by the Australian Housing and Urban Research Institute projects overall ownership could fall to around 63 per cent by 2040, with the rate for those aged 25 to 55 potentially dropping below 50 per cent.
It is at this point that the policy debate grows genuinely thorny, and where ideological honesty requires acknowledging competing claims. Those who defend the current tax settings argue, with some justification, that negative gearing supports the private rental supply that millions of Australians depend on. Restrict the concessions, the argument goes, and landlords exit the market, rents rise, and the people hurt first are those furthest from ownership. University of New South Wales economics professor Richard Holden has flagged exactly that risk in recent commentary. Opposition Leader Angus Taylor has argued that reducing the attractiveness of property investment would constrain housing supply at the worst possible time.
These are not frivolous concerns. But the counterweight is also substantial. Parliamentary Budget Office analysis shows negative gearing tax breaks are projected to cost $101.3 billion in foregone revenue over the coming decade, and Treasury data suggests the capital gains tax discount overwhelmingly benefits higher-income earners, with data showing most of that benefit flowing to those in the top income brackets. The data reported by the SMH also shows that local governments have made brownfield redevelopment more expensive over time, compounding supply constraints at every level of the system.
Treasurer Jim Chalmers is now reportedly weighing limits on negative gearing and a dilution of the capital gains tax discount ahead of the May budget. Whether that produces meaningful change or another round of announcement without delivery depends on political will that has evaded governments of both persuasions for more than two decades. Labor's failed 2019 campaign showed what happens when reform is perceived as threatening rather than rebalancing.
The reasonable conclusion, looking across all of this evidence, is that no single lever will restore what Robertson's generation took for granted. Supply needs to increase substantially, and that requires all three tiers of government to stop obstructing each other. Tax settings that actively push investment capital toward established properties over new construction deserve serious scrutiny, even if the precise form of any change warrants careful modelling. And first-home buyer grants, however politically satisfying, have a documented history of lifting prices rather than lowering them.
Robertson says he could not comprehend taking out a mortgage for a million dollars. That sentiment, from a man who bought his first home for $7,500, is not a judgment on younger Australians. It is an honest reckoning with how thoroughly the system around them has changed, and how much deliberate effort it will take to change it back.