#adviceforjoe

Hi, I’m Immortan-Joe Hokey, Australian Treasure Hider for the Parliament Funkadelic.

Despite looking like a crooked, smug, fart-sniffing, thick-necked, no-lip, boiled-egg-eating, pancake-destroying, walrus-bodied, Sopranos-reject, bloated, fucking-goombah, I’m actually an all-round great guy, a man of the people. All of my maids tell me that.

Anyone born after about 1995 is pretty much screwed because all of the people born before then have made housing anywhere near the CBD unaffordable. We’ve had the benefit of stimulus packages, low interest rates, low-doc or no-doc lending practices, first homebuyer schemes and wages that are commensurate with housing prices. Prior to 1995 the banks’ lending practice was to loan a person a maximum of about 4 times their salary to purchase a house. That put an artificial, but tangible, cap on housing prices, somewhere in the realistic reach of most Australians earning an average wage.

Fast forward to 2015, meet Average Joe. Average Joe is on the average wage of $75,000. The average Sydney property price is estimated to reach $1m by the end of the year, or 13 times Average Joe’s average wage.

This means Average Joe can't realistically own an average home. With the average Sydney rent around $600 a week, he will never be able to save enough to get a deposit, to get a $1m loan, to 'buy' a house. I say 'buy' because really, the bank owns Joe’s house for the next 30 years, until he pays off his $1m mortgage.

With interest rates at 5.5%, everyone, including Average Joe and me, Immortan Joe, thinks that housing is affordable. But let’s do something I don’t really like doing as the Tressure Hunter of Australia, it’s called math. We’ll keep it basic because that’s all I can handle. For instance, let's take a look at Average Joe on $75,000 and the average house price of $1m. If you calculate a mortgage with a 30 year loan, for $1m, at 5.5% interest the total interest payment is $1,044,040. Let that sink in for a second. That’s more than the amount of the loan, just in interest.  Add to that the repayment of the principal of $1m, and the total cost of an average house over 30 years is $2,044,040.

30 years might seem like a long time to put a house on lay-buy, maybe you could pay off more, earlier? Well hold on there Donald Trump, lets take a look at this month by month.

From his $75,000 a year, Average Joe earns a net income $4427 a month. The 'minimum' monthly repayment on Joe’s million dollar loan is $5678.

This means that if Joe never ate, never paid any bills, never went out with his friends, never bought a present for anyone, never bought lunch, never serviced his car, refilled it, never caught public transport, never bought any clothes, never had the internet, Netflix, a gym membership, never posted a letter, never bought furniture for his house, never bought a coffee or had a pet... and put every single cent into his 'average' home loan, he would still miss his repayments by $1251 a month, or $15,000 a year (which he would be charged another $800 a year on that missed amount at 5.5% interest).   Let's say interest rates went up, by a few percent, say 1.5% in the next few years and remained stable. That mortgage interest payment would now be $1,395,066 or $350,000 more than the loan at an interest rate of 5.5%.

To put that extra $350,000 in perspective, Joe's $75,000 a year is actually $53,000 after tax. That’s another 6.6 years of annual salary for Average Joe. So for Joe, if he took out a loan at 35, and expected to retire and own his home at 65 he would be mistaken. He wouldn’t be able to retire until he was 71.6. Oh and don’t forget, Average Joe was short $1251 on the 5.5% loan each month. Joe is more likely to die before he owns his home.

What’s my advice for Average Joe. Just get a better job. Get on SEEK and go for it! Don't work a job that pays less than $75,000 or even $100,000 a year. Just refuse to. Someone will find you and pay you more, because of stuff.

If that doesn’t work, just become a boring lawyer, dentist, banker, doctor or some other job with the highest suicide rate, worst working hours and highest incidence of depression. Forget pursuing a creative career and the dream of owning a home, they’re mutually exclusive now.  Instead, devote yourself to being a ruthless, cutthroat money obsessed corporate prostitute drone.

Here are my other great ideas for home ownership and riches, officially endorsed by the Department of Treasury:

be born into a rich family, you can do this early on in life by only being ejaculated out of the balls of a man who either has lots of generational wealth, or is going to be successful (look into the future for this), or make sure you hook up with the egg of a similar woman (again, look into the future and choose your balls/egg combination wisely)

develop an interest in corporate law, banking or cardiology from an early age (7 or under) if you aren't into these topics in your youth then make yourself interested in them, the other option is being poor and not driving

get in a time machine and travel back to the Pilbara in 2002 and get a job doing pretty much anything, like a janitor on $150,000 or a lollipop-man-for-trucks on $170,000

sell your vagina/anus to pay off your HECS debt (i.e. become a highly paid whore)

be a young attractive woman and baby-trap a rich man (i.e. go to a bar frequented by investment bankers and have sex with one of them while lying about being on the pill, give birth to a golden goose baby)

join a bikie gang and sell marijuana or crystal in bulk (note!: don't get murdered or arrested, this is bad for your credit rating)

create the "car-house", my car-house is a 2005 Kia Sorrento. I'm making some money on it by renting the glove box to an international student

be a networker, people love other people who network, constantly pressure people into becoming your clients, they love this

get a TER score of 99.98 or higher, just beat the competition from elite private schools with great teachers and/or Chinese supercomputer children, become an accountant

steal from the elderly, children, cars, work, everywhere, just take it, take things and pretend you didn’t do it, you are Winona Ryder

invent gold

Save every cent you earn, never associate with friends. Get comfortable being described as 'frugal', 'tight' 'cheap' or 'stingey', don't enjoy life, just be obsessed with money. Never pay your share.

cheat a skewed tax system, tell your employer you 'only take cash', claim your tax deductions as tax deductions, invent 12 children you need support payments for

walk out of restaurants without paying, or eating, because you can't afford anything at McDonalds anyway, this is also known as 'not eating'.

get a second job at night driving for Uber, wait tables, work mornings at a bakery then night shifts at a local steel mill, never sleep, become Eminem sell 100 million albums

murder your landlord and assume their identity, your new name is The Talented Mrs Joan Jenkins

become immortal, work for 600 years non-stop and treat yourself with a holiday in Kuta, or Seminyak if you're a real fuckin snob and saved well

marry an investment banker who looks like Alf and probably has the personality of a shoe (my favourite)

join FIFA, the Australian Wheat Board, Australian Water Holdings, a drug squad, or other corrupt organisation such as a local government council or workers union management and take bribes

make your own house out of materials from around the hou... oh wait...