The Elephant in the Room Property Podcast | Australian real estate
The Elephant In The Room Property Podcast with Veronica Morgan & Chris Bates

Episodes

Episode 76 | Demographics, the study of who we are, where we live & what defines us | Mark McCrindle, Social Researcher

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How will GenY, GenZ & Alpha get into the property market?

Demographics is a study of who we are, where we live, what defines us. The numbers tell a story. Demographer & futurist, Mark McCrindle is an award winning social researcher, bestselling author, and influential thought leader. 

Mark's shares his understanding of key social trends & we find out:

  • Are Gen Z & Alpha likely to own property in Sydney & Melbourne?

  • The unintended consequence of parents supporting kids & creating a financial dependance mindset.

  • Migration - why are we so hung up on the numbers?

  • Are our urban centers able to sustain population growth?

  • Key factors that boost infrastructure & our economy.

  • City planning & the importance of getting it right the first time!

  • Why developers need to listen up & start building for young families.

WEBSITE LINKS:

Fools & Forecasters Report

Infographics - Mark Mccrindle Publications
GUEST WEBSITE:

http://markmccrindle.com/

Work with Veronica? info@gooddeeds.com.au

Work with Chris? hello@wealthful.com.au

EPISODE TRANSCRIPT:

Veronica: You're listening to the elephant in the room property podcast where the big things that never get talked about actually get talked about. I'm Veronica Morgan, real estate agent, buyer's agent and cohost of Foxtel's location, location, location Australia and up Chris Bates, financial planner, mortgage broker and wealth coach and together we're going to uncover who's really making the decisions when you buy a property.

Chris: Please stick around for this week's elephant rider boot camp and we have a cracking dumbo the week coming up!

Chris: Before we get started. Everything we talk about on this podcast is general in nature and should never be considered to be personal financial advice. If you're looking to get advice, please seek the help of a licensed financial adviser or buyer's agent. They will tailor and document their advice to your personal circumstances. Now let's get cracking.

Veronica: In recent times there's been a lot of talk about population growth, particularly in Sydney and Melbourne, and whether this will render our cities unlivable and when we start to feel things are getting crowded, when our roads groan under the weight of too many cars and when we think our kids won't be able to afford to buy a home or even rent one, then we humans tend to get very protective of our status quo, but let's face it, as cities really are very spread out and our populations are small by global standards and anyone who has traveled will know that so surely we have capacity for more people and aren't we all about to jump into a driverless cars and a fast trains and live remotely anyway.

Veronica: Now having said that, of course, are we paying attention to how gen zed and Gen R will live as they grow older and move out of home? Will they chase home ownership with the same zeal as their parents and wouldn't it be great if we had a crystal ball to show us what the future holds? Well today we have the next best thing, a demographer, a futurist. Mark McCrindle is an award winning social researcher, bestselling author, an influential thought leader. And today we want to explore Mark's understanding of key social trends and what the future looks like in terms of how we live, where we live, what we live in, and who we live with. Welcome mark. And thank you very much for joining us.

Mark: Thanks for Veronica and Chris. Glad to be with you.

Chris: Thank you Mark. I'm so extremely looking forward to this episode, not that I'm not with other guests, but I do love demographics and I do love understanding and thinking about this as a topic. Um, I think it has such a huge impact on the property market and the more that we can understand this, the more we can understand the property market. I think the, the future of our cities is quite interesting. Um, yeah, there's lots of talk around, you know, where it's gonna go. What do you think is some of the stories that a lot of people aren't talking about that need to be heard?

Mark: Well, urban growth is a strong one. And, uh, clearly we see that around our cities. We've got a population that's growing, but our urban centers growing even faster than, than the suburbs and particularly the outer areas. Uh, but also when we talk about urban growth and city growth, it's not just a story of the capitals because the regional cities are growing very strongly as particularly you look across both Queensland and Regional Victoria and you've got to cities, there like Ballarat and Bendigo and we're don't get that are growing very fast. In fact, Geelong growing faster than Melbourne at the moment in growth rates. So the growth of cities, the urbanization trend isn't just about those capitals. And we do see growth across population centers, you know, right across this nation.

Veronica: And what's causing that growth do you think?

Mark: Well, the biggest part is net overseas migration. So we are on the global map. Australia is a place to relocate to. In fact, some places like New South Wales has had an interstate loss. So we're actually losing more people to, to the other places. And South Australia, WA, the Northern Territory. The same. So, so we've across a lot of Australia got growth because of the net overseas migration. In fact nationally that comprises 60% of our growth, just 40% coming through natural increase. So we are ticking along with births minus deaths about, but it's really that overseas arrivals that's driving the growth. We see Nationally.

Veronica: And are they coming into Sydney, Melbourne and then sort of existing people, existing residents are moving to those regional areas. Is that the way it's working or are the immigrants coming and going to the regional areas?

Chris: No, you've summed it up in that former statement there Veronica. It is the gateway to Australia is Melbourne and Sydney and you've got those that have been born raised here that are finding the cost of living and the stress, the pressures perhaps the commute times a bit much and they're looking for lifestyle change, perhaps tree change elsewhere. So that's the shuffle that we've gone overseas gateway arrivals, locals looking for alternatives. And that's what's growing the regions.

Chris: So there's been a bit of talk recently about slowing down population. You know, we've got problems with congestion, etc. Do you think that that's actually what the government want to do or do you think they're just literally saying it out there to please the public now to win votes, but really they want to keep population growing quite strongly?

Chris: Yeah. We have got an economy built on population growth at the moment and you're, our growth of 1.6% per annum that we've seen consistently in the last few years is below what we had a decade ago when we're hitting 2% per annum. Now it is higher than we have had historically, but even with this tweaking of the migration numbers into Australia, about 30 or 40,000 less than we saw to bring us to about the 200,000 net migration numbers. That's way above what we had 20 years ago under the Howard government where it was about 80 or 90,000 a year. We're still doubled that and it looks like that 200,000 per year net growth is locked in and you know the economy requires it. If we look at how they're coming, why they're coming visa wise, the majority of that is skilled visa. It's plugging the workforce gaps that we can't feel locally. And then you've got students of course, which is one of our big export earners. You've got long term holiday makers, you're going to keep in mind that those net overseas or permanent arrivals as they call them, uh, or anyone here for 12 months or more. So that's not necessarily people here for the rest of their life. And it's a big economic, bonus as well. So a lot of people arm,

Chris: You know, a lot of people have been upset when populations rising. I think that they're taking their jobs or they're not taking jobs, they're sitting there and not working on the dole. Do you have any evidence to prove that that's not really the case? Do you, do you have any stats you could kind of help our listeners better understand? Because I think there's a misguided belief that it causing more problems than they're creating, I guess.

Speaker 3: Yes. Only about 7% of the visas granted. And so those permanent arrivals are here for non economic or economy boosting reasons, family reunion, visa's, humanitarian visas. It's a very small proportion. So the bulk are coming here to add to the economy. They're on a sponsored visa, they're on a skilled visa, they're moving into a job and of course they're tax paying in that role and they're plugging a gap that otherwise wouldn't be filled. The government really is tightened up on those skilled visas and also on the student visas. So this idea that you can just come here and, and so you know, hang about or do a pretend course that doesn't happen as much now either and after coal and iron ore the biggest export earner we have is this international student arrivals. So, so the bulk of it is having a big impact on the economy and it does stimulate the property because you've got people that are renting or people that are spending, you got people that are needing accommodation. Uh, even though it might not be a permanent thing it's 12 months or so. And so that does drive the, the development and the investment into housing as well.

Veronica: And if the numbers are fairly consistent than those that leave next year, you will be replaced anyway. So I guess they've got to be housed. You talk about skilled migrants and um, and we know that the government's cracked down on, I think the hospitality industry. He's been screaming about the fact that they're, you know, they have been closed out of the 457 visas. What are some of the skills that we are short of

Mark: A lot in the manual areas. So if we look at the manufacturing sector, that's where we've got skilled visas coming in now that's a declining sector. Agriculture has been another key area that's also pretty slow around employment. But increasingly you've got people that are doing clerical or back office operations that again, we can't get locasl to fill, you know, we're going to keep in mind in Australia that more students who finished school go into university than go to Tafe or get a vocational qualification. So even in the construction industry, you think of the plaster as the painters, the renderers that is largely through overseas migration rather than locals being trained in those trades. So we do have a, a real skill shortage. And of course not everything can be done online. Not everything can be outsourced overseas. We do need people physically here to do some of this. And then we moved to the caring area. You've got an aging population. We've got the NDIS looking after the caring of Australia's and need assistance. Again, we've got real short falls with locally born Australians to fill those roles that that caring profession, really the backbone of that is from overseas.

Veronica: So as we as a nation become wealthier, we don't want to do the dirty jobs. So we import them. Is that what you're saying?

Mark: That seems to be the attitude know and maybe it is this job snob sort of culture that we've created in young people. You know, we need to keep in mind the one of the strongest correlations between longterm career success from study is having a part time job during the study years. So this idea that young people can live with mum and dad, do it, a degree and be funded by them for three or four or five years. And then moving into some professional role I think underestimates the benefit of developing a work ethic and a culture by part time work. And a lot of that can be in the caring roles. A lot of that can be in those part time service or hospitality roles. And we need to encourage that with young people.

Chris: Do you think that Australians, um, you know, we've just had population growth consistently, there's always people who want to come here. Do you think that we should be very careful and not become complacent to assume that the world would always want to come to Australia? Have you seen any trends to kind of show that, you know, some parts of the world are no longer seeing Australia as that kind of dream location?

Mark: Yes. It's a world of global competition for arrivals. Now, if we look at education, for example, uh, you've now got more Chinese universities in the top 100 ranked universities than we do in Australia. We used to think we're the only game in town, you know, and anyone from Asia wanted to study, where else would you want to go? But Australia and we do have great universities of course, and so does the emerging world. And so does Asia and, you know, America is really a profile themselves, better in higher ed. Canada has, England has, so if someone is looking for an English education, it's not just Australia, we can't be complacent about this. And you're right Chris, in other areas as well, you know, even long term holiday making, uh, working visas, even just as a place to relocate on a skilled visa. There are other options and we can't assume that they're always going to come here.

Mark: And we also can't take it for granted because in the last, yeah, for example, if New South Wales didn't have growth from overseas arrivals, we would have almost gone backwards. I think we grew by six or 7,000 people through natural increase, borderline in a, in a state of 8 million people. And if you look at Tasmania until the last couple of years when the property market took off and the economy took off, they were going backwards in numbers because they couldn't get the overseas arrivals and no one was moving there from Australia. So that is what happens. And if you have population can contraction, you have an economic contraction. Yep. So we do really rely on the migration growth.

Chris: Yeah. It's so interesting because I think it's, it's, it's very easy for us to say, oh, we're going too fast. We don't want to know, just reduce the caps. But that sends out a perception too, the world that we don't really want great talent to come here. And you know, I think that a lot of the two in the last two years, a lot of the changes with the four, five, seven and the extension from two years, I think you've got to be here now too, uh, four years. You've got to be here now to get permanent residency, not two years, you know, upset a lot of people. And a lot of people said, well, I don't want to be here anymore. I think a lot of the things with Brexit, you know, um, how much that is upset they're of, you know, dream location moving to London. So I think there's Austrlians just gotta be careful not to just, you know, look a gift horse in the mouse and think that, you know, we shouldn't just, encourage population growth and tourism because you know, at one point it might flip the other way. Could have economic conduct problems caused.

Mark: Exactly. And you know that we've had this long term shift in terms of migration patterns from Europe, which we've taken for granted for a couple of hundred years now. You know, England and, and indeed New Zealand and they still are in the top five countries of birth of those born overseas. But China, India, Philippines and Vietnam are also the next ones on that list. In fact, number two, country of arrival after England in terms of our total population is China in terms of current rivals. China is number one by a long way in India as well. So, so we do look to our north now in Asia and we have had a boom in the entrepreneurial base of Australia in terms of our trade, in terms of getting good skills by connecting with Asia, and we're in a great location strategically and geographically because of that and the migration. So again, factors we need to keep in mind for our future.

Veronica: It's interesting isn't it? Because you know, let's face it, Australia's built on migrants invaders. Um, and we don't like change and they've face of Sydney and Melbourne is very much changing. It is, it is changing in certain sub certain suburbs and areas have been noticeably changing say over the last few decades, but our wealth is very much built on that. And so if we just focus on one thing and you know, we're failing to understand the whole knock on domino effect of all of this stuff. And there's been a topic of conversation with so many of our episodes. So many of our guests here is that he can't just adjust one thing and expect it not to have an impact on our economy and on our wealth. And individual property prices. You know, one reason why Sydney is so strong and Melbourne is so strong and even though we've had these falls, but generally speaking they're the two strongest markets in the county is underpinned by population expected growth. Right? That's exactly right. So what do we have to do to fit more people into our cities?

Mark: Well we're on the right track there. You know and again, we need to remind ourselves that if we didn't have the urban growth that we have in Sydney and Melbourne and we all whinge about it from time to time, that congestion and the like, we didn't have that. We wouldn't be seeing the metro that's now up and running in Sydney. We wouldn't be seeing light rail investment. We wouldn't be seeing in Melbourne massive investment in, in heavy rail as well. Talk of high speed rail connecting Sydney and Melbourne and maybe Canberra. This would not be taking place if we didn't have the population densities of 5 million cities as Melbourne and Sydney are. So. So it brings a lot of living in a lot of lifestyle that otherwise we wouldn't get end and accommodation type that a lot of people want. Not everyone wants a suburban house in the outer parts with a backyard and a lot of young people now and downsizing boomers are looking for that apartment, living the walkable community. And again, that only happens with population growth.

Veronica: Yes, keen to know more about that actually in terms of that demand of young people and young families for apartments. Because I know, you know, we mentioned this many times, my sister lives in Italy for instance, she's brought bringing up two boys in apartment. Everyone lives in apartments pretty much. You know, we're not everyone, but you know, the majority live in apartments. They don't even have outdoor space. You know, it's not like he, you got to have a big garden courtyard or terrorist or something. And you know, back in my parent's day it was a almost a status thing to have your quarter acre block, you know. So we're talking a thousand square meters or 700 up to a thousand and now I quickly jumped on line and had a look at what the size of blocks are in these outer subdivisions of Sydney. Now there is small as 240 square meters and sort of the average is around 300 and they don't have much of a backyard. By the way. These houses are buit cheek to jowl they so there's a definite change in expectation in terms of space, so I became to know what the research is showing in terms of that attitude change around apartments for Australians. Is it purely because, sorry, is it purely because we've got so many people coming from overseas

Mark: And it's driven by by the demand side as well. That is that that actually locals and overseas arrivals are looking for that sort of living. You know we've got not only generational change but we've got attitudinal change. We've got changing household structures two income earning households, busy lives, juggling kids and everything else going on and even those with young families don't necessarily want a backyard anymore. We've done really well on our city planning with parks and shared public facilities that can allow that, that community and that green spice. But you know, people just want to lock up and leave place so they can get to work. And I don't want the weekend focused on maintenance in the backyard. So, so Australians have responded to the different products on option now beyond just that suburban home. And again, that comes with the population growth. And as for the, the growth, you know, we think we'll can, we sustain this growth in our Melbourne last year grew by 135,000 people in a year that we've never had a city grow by as many people in a single year. So it is strong growth, but we are creating the lifestyles to go with that growth. The, the, the densification with the city planning and the, and the, uh, locale, um, and the, the urban facilities that can accommodate that growth. We're way above what was forecast at the ABS forecasts of 20 years ago, said that our population in 2051 and so we've got three decades to get there. They said would probably about be about 26 million. We're already at 25 and a half million. So we're closing in on that with three decades to go. So in other words, we're way above the forecast of what was predicted from 20 years ago as to where we'd be mid century where we're not going to be at 26 million in the middle of the century will be more like 42 million. But if we look at how we've accommodated that growth above the forecast, we've accommodated very well and we haven't sacrificed lifestyle for it. So we have a habit of finding solutions and I think that will continue.

Chris: So I think that, you know, because the next generation, if you're saying potentially might want to live in the inner walkable city near the city kind of hubs, apartments and more style, what they want, is that kind of going to be a potential problem for develoipers who are building these these green fields, you know, outer fringes. Because, you know, people will say, Oh, you know, there's a housing problem in Sydney, or there's a housing problem in Melbourne. And as soon as you get on the satellite and you start looking at land available, we'll really in the western suburbs of Melbourne, there's, you know, farms and farms and farms, we could build, you know, 2 million houses there. If you look at the southwest of Sydney, you know, there's farms and farms and farms that could be houses. So we haven't got a shortage of land out there. But would that, do you think there could be a longterm shortage of demand where people say, we don't really want to lose 60ks in the city. We want to live in apartments?

Mark: I think that's a good point, Chris. We do have to watch this suburban sprawl and I think even more Melbourne where there is no natural land barriers are like Sydney has with the Blue Mountains and rivers. So, so they can keep expanding and, and there's the opportunity to do that and there's the population growth to do that. But at some point that distance, particularly the commute, uh, if they're working in the CBD does become a barrier or can create those dormitory suburbs where people live there in the day and, uh, uh, but, but you know, then, uh, sorry in the night, but then they're, they're empty all day and certainly empty you're week, you just don't have that lifestyle. And, uh, and I think we have to get our city planning right, particularly around where the work is located. This idea of the, of the spoken hub, you know, everyone lives in the outer suburbs and then commute into the CBD has to change. We're starting to see that with business parks and new pop, new employment centers outside of our CBDS. We haven't nailed that yet and we haven't nailed better commutes in connections across areas of our cities. So, so if we can get that right, I think the sprawl can probably continue. Um, but uh, but it's not a given that just because we've got a greenfield and put up a bunch of new shiny homes, it's going to sell because there is a little change in that location mattering more urban and walkable mattering more as well.

Veronica: Why, why do you think we haven't got those sort of employment hubs, right?

Mark: Yeah. Well big business wants to be in amongst the action. The uh, the larger corporates want to be around other business services. And because we've had such a model of CBDS, uh, even secondary CBDS, have taken a while to take off.

Mark: Now Sydney's got north Sydney and that's worked out alright. And then a more recent decades we've got the city Olympic Park, we've got norwest business park in the Chatswood, a lower north shore's got a few things, the occasional thing and in the southern part, but you're not that far out though, are they? When you think about it? Exactly. We haven't because we've, we've put in industry in the outer suburbs and manufacturing and the, and the warehousing and, and any professional sort of service type roles or in urban or inner business parks. And I again, I quite close to the CBD and yet our employment trend is all towards white collar, professional tech roles and uh, and that, that manufacturing hub is not really humming along. So we've got to get a more diversified offering of roles and jobs across the regions of our cities, uh, than the traditional model.

Chris: It's funny you say that cause I think that's one I really interesting point for people is they will get very excited about say badgery creek airport and they think it's going to be these huge employment hub that's just gonna boom. There it's, it's like, well it may, even if you want something it doesn't mean it's going to happen. And I think a lot of these employment hubs, you know, they do have a lot of the back office, you know, a lot of the middle management and lower kind of, you know, positions. And then the EXEC teams are all in the city. You know, they've got an office in the city for the higher paying kind of jobs. Then all the kind of middle and lower paying jobs are in the suburbs. And I think CBA is a good example because CBA had all these offices around and it wasn't really working. So they ended up putting 10,000 people in Redfern, you know, right near the city. Um, because it was much better for commute. It was around other businesses, et cetera. So I think that's another example where, you know, people are still gravitating towards the cities and you only have to look at how much office towers are going up. Um, there is no, is that kind of where all your knowledge jobs are pretty much getting created and very little in kind of Parramatta and things like that.

Mark: It's slowly starting to change. I'm in Parramatta is a great example, Chris, because you are getting the banks, uh, government, uh, and large business starting to invest there were getting a CBD in itself occurring there. It's not just a retail precinct. Uh, and it's not just government services, there's a lot more going on. So if we give it a 30 or 40 year time span, we will have multiple CBDS in Sydney and Melbourne has the exact same vision. The future of Victoria plan is that 30 minutes cities and, uh, and that's what we'll see across our larger capital's button. It, it'll take a couple of decades yet and better commute, connections, light rail at other options. Uh, that'll, that'll help facilitate that.

Chris: So I think, uh, it, would you agree that a lot of it's chicken and egg, like a lot of government could go to Parramatta because, you know, they're kind of incentivized to do it and they're in control and, but do you think a lot of, kind of new starting, you know, you know, entrepreneurial type businesses want to be in the action still and they don't say Parramatta, even if there is government and Deloitte and things like that there, they still want to be in the CBD, you know, where the action's happening.

Mark: That's right. It is changing a little bit. It takes a while to change those attitudes. And, and the city our CBDS of our largest capitals have really become reinvigorated of recent decades. Uh, they are the startup hubs. They are the cultural capitals. They are the, uh, the, the new young entrepreneurial hotspots. And so that's given extra weight and gravity, if you like, to our CBDS, meaning these outer CBDs are finding it harder to compete. But I think we will start to see change. We are starting to see change where people see an outer CBD as a bit of a cultural hub, as a bit of a retail and a, and a recreational and a food culinary hub in its own right. Uh, and with a population center more closely located to it and often a lot more cultural diversity, which creates that extra dynamism. Well, so we're on the right track. It'll probably take a decade or two to really see it yet.

Veronica: It's really interesting actually, that, because I mean, Parmatta is a great example. I'm just thinking back to nearly 25 years ago, I was in recruitment and I was in the Paramatta office, with a company that had the head office in Sydney and I'm in the city and it was very much they were, they said not so jokingly call it the nursery, you know, it was certainly seen as a poor cousin. Um, but you know, there was office buildings there, there was a Westfield there, there was, there were some restaurants out there, there was, you know, and it has certainly changed in the intervening 25 years, but it's still not quite there yet. And you think all these people that want to buy investment properties for instance, and they're chasing that, I'm going to buy out in Liverpool for argument's sake, cause that's going to be the next hub. And it's a really interesting point that it takes decades. You know, the intention is to be there at the outset. They've got to be, you know, then some companies may movie, then they move out. You know what I mean? It's going to be these two steps forward. One step back. I would imagine for some time. Um, yeah, I just think that that's a really interesting reflection.

Chris: I think a lot of around Parramatta in particular, a lot of that that's been really hit hard with property values over the last two years compared to other parts. Um, I think because it was over excited, people were seeing Parramatta, there was 30 big huge high rises that were approved. I don't think most of them are going to go ahead now because they just can't sell them. But it was really a big growth story and people got over excited and I think Badgerys creek and things like that. So it just gotta be very careful when you are trying to invest on these big hotspots because it's gonna take time and it's going to take decades.

Veronica: Yeah. And it's interesting that you say that about it's what's being built too, you know. So if basically you've got a bunch of, you know, big buildings with two bedroom apartments and you've got families and might want to live there and they want bigger apartments, you know, there's a mismatch in terms of what's being built versus what, where the demand is going to be.

Mark: What we do see at what they do have and Parramatta is a great example. Geelong is another one, um, from Melbourne is, is that they've got the right demographic mix, a younger population and more culturally diverse one in Parramatta really exemplifies that. Uh, it's the center Parramatta of of the city of Sydney's population. Um, center. There's many people live further west of Parramatta as is live east of Parramatta. Sustained geographic. Yeah, the population center and the geographic center. And so it's got this dynamic population that's actually growing faster than, than the city is. And a with the cultural diversity, the younger age and now very strong education base there in terms of western Sydney University. In terms of some of your startups that you've got a bit of a few cultural hubs being moved out there, like the powerhouse museum, all of that with the infrastructure taking place is setting it up very well. And yet you've still got some price advantage because as you said Chris, you know, people still sort of are disappointed a little bit. Well that's the perfect time to, to look when all of the ingredients are there. Uh, people can sort of buy in and get the uplift that comes from that, from that infrastructure growth.

Veronica: It's quite funny isn't it? Because in so many sort of speculative type investments that people are getting earlier, the ones that make the money, whereas in this case you might be the ones that got in early and the ones that losing all the money. Yeah.

Chris: So Gen zed or Alpha, obviously after only very new, isn't it? That sunny last seven years, since 2010 yeah. Daughter's just turned 13 and she's not even alpha. She's GenZ. Yeah. Is it too early to be finding out what they want or they're thinking?

Mark: No, I mean we can look at their parents and they're at school now, the, the oldest of these Gen Alphas. And we can start to understand a bit about what's shaping them. So, you know, in terms of these generational definitions, each generation now spans 15 years. So when most people have heard of generation y and after them came generation z born from the mid 99 is to 2009 so the children of these gen ys because the Gen y's now, and they're not just, you know, young people, they're hitting their early thirties, we call them generation Alpha. We've worked our way through the alphabet. So moving to the Greek one and that's what's going to label every generation to the alphabet.

Veronica: We went from baby boomer to Gen X True.

Mark: So we uh, we started at the wrong part of the alphabet, but anyway, having completed it, um, Alpha is the next. And, and what we know about them is that the parents, all them, that Gen ys are actually pretty conservative when it comes to raising their children. They're focused on ensuring that they get every opportunity in life. We're seeing growth in investment in young people going to independent schools not just government schools. We're seeing after school tutoring, we're seeing the CO curricular activities being invested in strongly these gen ys who were originally the Dotcom kids and the Igen and all of that are actually limiting screen time because they are digital natives. They've seen the technology to possibilities but the downside side of it. And so really structuring the lives of these kids in a probably more formal way. And, and I think they are shaping up as a, as a pretty exciting generation to watch.

Veronica: This is sort of interesting because of course I'm Gen x, uh, you know, I was a bit old when I had my daughter. Millennials are having babies, you know, and even though they're getting a bit old now, um, and obviously you're saying Gen y having kids, um, you know, when people have children and despite the fact that they might look at it screen time differently and, and investing in education differently, et Cetera, et Cetera, in terms of what they want to live in. And where you know, the things that are important to them. You know, you talked about convenience, you talked about lock up and leave and everything, but fundamentally, you know, a lot of, uh, I hear a lot of GenY talk about they want flexibility. So before they have children, they want to be able to literally lock up and leaving the country often. But once they have children, do they really start to go back to, does everyone basically, is everyone the same? Once they have kids.

Mark: Did they are Veronica. It's a good, that's a good observation because security becomes a key focus when people move into the family forming years. I mean a little stat that it'll show this four and five couples who marry cohabitate prior to marriage. Um, and yet four and children born in Australia today are born to married couples. In other words, couples will live together, you know, hang out when it comes, what's the trigger point for them getting married, thinking about starting a family. And then they say, even though we live together all these years, let's tie the knot because they want security before bringing children into the world. And the same is true of property. They want to move from the rental to suddenly get a place where they've got some security. Ie they needed their own place. So, so it is a key time. A lot of change happens as they start to move into the family for many years. Not just their, their own relationship and the status of that. But of course thinking about property, thinking about where they're going to live, thinking about where the children, uh, I going to be educated and, and their futures as well. So security, uh, nesting, you know, focusing on the future and viewing through things through the eyes of these children, uh, becomes a priority.

Chris: I love that. I mean, that's good because that's really lays into where you can be smart with property investing because you're right, they, they get married and then they want to have kids. But at the same time they're thinking about getting home ownership. And so no matter what's happening in the world, um, they, they think it's a good time to buy because they really want security. And so that if you could buy a property that really young first time buyers on double incomes that are on high incomes that they would want and that they would want to have a family in. Um, it's a really strong demographic that no matter is what happening in the world, they're going to really desire your property. And I think it's uh, um, and the, usually the most emotional because you know, they really want that security element as well. So no matter what's happening, they'll more likely go out and buy rather than say, oh, it's all right, let's just wait five years because they haven't got that time to wait.

Mark: Exactly. And they're at a point in life because the average woman having a baby in Australia today is 31 years of age, just a few months short of 31. In other words, they're a bit older as a couple to incomes, as you said, they've got a bit more stability and they're looking astutely to buy a place for that security. And um, and it used to be that couples when they came to look to start a family wanted a home detached home, you know, that traditional approach that's changed people said are you know, living is for the singles and the couple only or we've broken that ceiling. It's now for the couples with young children and we've got in our CBDS and where the units are a lot more childcare centers, a lot more primary schools. They really, and a lot of parks, you know, they're gearing up for the young families, these urbanized areas and people at the moments I okay, yeah couples with young kids live in units and apartments but when the kids get a bit older they move out. And that's been the pattern. But we're starting to see that glass ceiling break as well. That is, couples even with older children moving into their high school or teen years also living in apartments. So they can provide a longterm options and opportunities. This particular demographic, uh, but we've got to make sure we're building the right stock for them with the versatility to not only be a couple only, but a couple with the youngsters and a couple with the teenagers as well.

Mark: So good. I literally had the same conversation with a client last night, um, by, you know, the, basically they're looking to buy their, their first time, a young couple. There were a couple of years away from I guess the marriage and kids. Um, but they're very conscious that they'd been together a few years and it's very much going to happen, hopefully if the water lines. Um, and she from the lower north shore and he's from Belgium and he has no desire to live in the upper north shore and they can't afford the lower north shore because it's just too expensive. And so, you know, it was a really half an hour chat and I was really challenging them and saying, look, um, you know, that one though was saying they wanted to live in an apartment. And then I was saying, well, do you really want to live in an apartment or would you prefer to live in the upper north shore and in a house? And she's like, he really wants an apartment. I kind of want the house. And it was this kind of push pull and a lot of it probably comes down to for me where he's from and he's probably, you know, more, you know, he's from Belgium and she's from the lower north shore. Um, and you know, and she's like, like, I've been thinking about a lot and I actually do think that we could be happy in an apartment and, but we, we want a really nice apartment. And so I want to live in Drummoyne, which is kind of an inner ring, kind of three bed apartment, you know, two baths, you know, with views. Um, and so, yeah, and the, the, it's probably possible cause there's some examples that we've seen, but it's just very interesting. But they want from an apartment is very scarce and there's not many of those out there. And we, so we, yeah, when we look at their, what their stock available is, what your point was, is that we haven't built with the young people really want. And so that's probably the big opportunity going forward for developers to actually build what young families would really want.

Mark: Exactly. And if we go back 20 years, you know, developers were saying, why would we need to build three bedroom apartments who needs three bedrooms in their own apartment now that's the primary demand and some of those four bedrooms and larger living spaces, uh, larger, uh, indoor outdoor spaces because you've got the kid, you need a little bit of spice, not everything. Yeah. They're spending a lot of time as youngsters within the walls of their apartment. And I note that Harry Triggerboff off Meriton said that they'll never build another development without a childcare center in it because that's now the clientele buying into Meriton. So, so we're seeing changing of the mindset as to who lives in apartment living and the city's accommodating the young families. And that's certainly something for the future.

Veronica: There's also the downsizes. They want large apartments too. And, um, you know, I remember there's a development in Balmain Cove, which was actually in Rozelle, but marketers back in the day, which is probably about 20 years old now, actually older, it's older than that now god, time flies and they are oversize, absolutely oversize. This is not marketing speak over sizes are big three bedroom apartments, some of them with a second living area. Um, and all with big outdoor space as well. And they were really heavily pitch at the, at the downsizer market, you know, with water views as well. So there's, and I remember first going through them in my first years of real estate and meeting the people that are bought in there and they were people who had moved from that, the, you know, the acreage out at Dural, that sort of way. And certainly from the upper north shore they'd all moved there. And I think what we're seeing now is seems to be that there's a bit of a shift from those people moving on to whatever's next for them and you in the family is actually starting to take, take, take their space. That that was sort of a bit the, you know, they, that was a development that was very much ahead of it's time really. And, and there's still not enough of it.

Mark: No, that's right. And keep in mind your developers had to certainly keep it in mind that if, if they do see a good opportunity for the downsizers, that doesn't mean that you don't need the barbecue areas and the kid friendly spaces because downsizes have grandkids and want to bring the grandkids and their kids along and downsizes want the life and energy that young families have. We all look for that diversity of housing types. No one wants to live in a place where there's no kids to be seen where there's no life in energy that, that young families and that the variety of the age groups, brings.

Veronica: is there a change in downsizing? Because it seems to me that people are deciding to downsize maybe a little earlier. They're realizing that while they've physically able and I want to go and travel more and I really want to embrace everything that retirement has to offer that yeah, they may be doing so a little earlier. What is that happening?

Mark: That is, and you know, we've got a whole industry get up for retirement villages and retirement living less than one in 10 Australians will live in a retirement village. So the majority of handle it themselves. They're doing their own downsizing through their own private residential market and that is by buying those apartments or, or a more downsized property. And they're pretty astute. They're cashed up. They are doing it a bit earlier as you just said, Veronica, for lifestyle reasons. Um, but a big trend that we've noticed is they're not moving to traditional downsizing spots, either the coastal areas, uh, or even see change areas or even those particular hot spot within our cities. They want to downsize locally because the kids and grandkids, that connections there, social activities, that church, they're part of whatever it may be is all local. So that is why we're seeing apartment dwellings and developments take place in even outer suburban areas of our cities to accommodate, you know, people wanting to stay within the area, not just have to move to those traditional apartment suburbs.

Chris: It's funny cause I think that's another trend as well. When the, you know, the older generation they, you know maybe the kids have moved out but the kids are in their twenties and they're not sure what the kids are going to do now what, what the, and a lot of them say is what the kids do is determine where we go. Yes. So if our kids moved to London, we might move to London, you know, if I can stay in Sydney will stay and see the life that they can't really get away from the parents. I've talked to your parents which is fair enough. I mean if you already got one child or two children chasing him around the world but you know and if they do stay in Sydney because of work, right. And so, you know, they've gone to uni and they've got their career. They, it's hard for them to leave Sydney cause they can't see any job prospects elsewhere.

Chris: Maybe Melbourne or overseas is what they think. But they stay in Sydney. Then the parents have to stay in Sydney and they don't want to be too far away. Um, so they're not going to go move four five hours away down the coast or up the coast. And so what they end up doing is they end up wanting to stay somewhere close. And that's probably, you know, good kind of. I, a lot of them want to move the northern beaches for example. This is, yeah, you know, it's an hour from the city because it's an hour from the city and we don't have to get to the City and we've got the lifestyle benefits. And so I think a lot of people need to think, you know, that is, I bet these markets and how they're shifting because you know, they do impact on property process. If your property does suit multiple assets or multiple buyer pool. Um, can you just explain a bit about the different personality or the different way that people think? Um, because we're not all the same, right? Even though we've got, you can categorize generations, even within that generation, there's different segments that um, you know, think differently.

Mark: Yeah, that's right, Chris. I mean, there's your, we've been talking demographics and those national numbers and state numbers tell a story, but below that there are the psychographics if you like, which is the attitudinal, the behavioral of what defines us and understanding therefore segments, as you said, beyond just the generational ones. I mean, each of these generations we were discussing has between four and 5 million people in them. So they're pretty large groupings. There are of course, a lot of attitudinal segments, particularly these days where social norms do not channel people into set ways of living. Or set life stages. There's a lot of variety or diversity within our population and different areas we'll will attract different people have a different vibe, if you like, or a different psychographic, um, different backgrounds and, uh, career types and socioeconomics will, we'll again further create these segments and understanding that is key, those uh, those archetypes if you like, or attitudinal categories and it is important when a organizations are looking to develop or if someone is looking to buy, to understand what's happening in your area.

Mark: We can learn a lot about the locals within an area by the demographics because the demographics telling attitudeinal a life story as well. If you look up a suburb or even a uh, a sub suburban area, which you can do on this farm bureau of Statistics website with the quick stats, it'll tell you earnings and average number of people in average age and a main job types. It'll tell you average education levels and all of that tells a psychogeographic story. It tells you an archetype of who's living in that area and uh, someone in and out of suburbs going to be different to someone in a suburb. There are the more artistic suburbs that are the more professional suburbs the more conservative in the more left leaning ones and that the numbers can tell that even without doing your own focus groups or market research.

Chris: Is that okay? Is it like if you're going to split it up into some are more pessimistic versus some more optimistic, some are more aspirational or some are more,is there some type of, you know, may like different, levers that you think that can really determine, like help us understand each generation more?

Chris: Yeah, definitely. You know, uh, I think one of them is looking at the financial attitudes and some people are more financially conservative and traditional. So if you look at jobs, they're looking for jobs and have high job security, traditional pathways, others, other areas we see a little bit more creative, perhaps more entrepreneurial, perhaps more willing to take a financial risk. You can see that around earnings and you see it around job types and you'll see it around, um, uh, education levels on the type of education that, that have, uh, have been achieved.

Speaker 2: Do you see it around locations.

Mark: Yeah. Yeah. You can see that as well. Um, so you know, in the western suburbs for example, you've got a very traditionally conservative financial approach. You know, they've got, they've seen parents start at the bottom and work their way up that, that, that tenure within a career that, that focus on, you know, good honest roles. Yeah. Hands up and get it going. You see that approach to life and in some of those areas you have this very quick intergenerational rising of the socioeconomics. Parents may be came out as migrants, the children are well on the why and the grandkids, uh, you know, really doing well financially. This, this fast socio economic dynamism. You've seen some of these areas, others have the luxury in other suburbs of maybe pursuing an artistic flair or doing a bit more travel. And so the, if for them, and maybe they've got access to money beyond what they're earning themselves, it's not just about that pure financial return or a or the, the viability of a particular financial option. They're looking at the financial side.

Veronica: That's interesting because that's really about, that's a luxury of being well off. If you're well off, it's Maslow's hierarchy of needs, isn't it? You, you've got all those basic needs covered, you, you've got a roof over your head, you a secure family, et Cetera, et cetera. And then you go, oh, can I can go off and learn how to paint? Now I can travel and more esoteric things. Whereas if you're still in that foundational part of, um, establishing yourselves, whether it be yourself individually as a family, then you're going to focus more on those concrete things. Do you think there's a bit of a, I guess a change in attitude towards people starting to think that, well, Gen y, GenZ, Jen Alpha, you know, they're not going to be able to expect to own a home anymore.

Mark: There is a lot of questioning of that, uh, in families and parents see it most acutely because they know what was required when they got into the property market and it was a lot less than what's required these days. Even when you compare that with, with earnings and, uh, we run surveys on this and the majority of homeowners today, and we're talking baby boomers and older Gen Xers say that they can't see the likelihood of their children owning a home, certainly not in the same time frames that they achieved it. So, uh, so that's, that's part of the challenge and that's why we're seeing parents really step up in terms of allowing the children to live at home longer in terms of supporting them with maybe use of the family car or increasingly towards, uh, helping, uh, give, give something towards a deposit on a home. You know, they, they're, they're finding ways to give them a leg up because doing it on your own, even with two incomes these days in one of our larger capital's is a pretty hard achievements, certainly, uh, harder to achieve in your 20s, a let alone even moving into your thirties.

Speaker 2: But at the same time, we've got alarmingly levels of financial illiteracy. Hmm. Yeah. You know, so, you know, they sort of go hand in hand, don't they?

Chris: It's interesting you say that because that was a lot of the experience I had in 14, 15, 16 in the boom is, you know, there was a real fear of missing out in the kids. And I feel a lot of that came from the pressure from the parents and um, you know, and society and you must buy and the parents in the, in the kid's ears and you're not successful until you own a property. And it's interesting cause they want to help because they've, they think it's linear. They think that what happened in their lifetime is what's going to happen in the next lifetime. And the and the growth in the property market over the last 30 years is what's going to be the next 30 years. And um, I don't think it is. Um, we can't go from one income to two incomes. We can't go from one medium paying job to, two high paying jobs can go from two incomes to three incomes or mean it could be the next Gen Alpha. It could be very open minded.

Chris: But you that you might actually, cause you might find that, and I've got some clients that are brothers and sisters and um, uh, good friends that have bought properties together and they live in co-sharing. Um, I've got two clients, one in Melbourne and one in Sydney that, um, you know, ones two sisters. Um, and one actually they are both two sisters. Um, and so they may make come to a point where instead of us buying, you know, $2 million houses, um, we'll put four incomes together and buy a $2 million house that's got six bedrooms. So, you know, I guess there's things that you know, that are going to change, but I think there are a lot of the parents think that, um, you know, we've got to get in and rate that anxiety in the child and the child's out there and they end up buying something that doesn't really suit them. So yeah,

Mark: I think the other unintended consequence of parents really supporting their kids right through their 20s is that came create a bit of a financial dependence mindset. You know, the kids now are relying on mom and dad and uh, and sometimes they're slow to leave the nest and create their own pathway because of that support. Parents from the best of intentions of saying get a degree, you know, we'll fund it. You know, it's important to invest in your future. And yet sometimes during that degree, part time earning a bit on the side, making your own way in the world really develops that character resilience and financial independence that, that we sort of lose if we're a bit sheltered. And, uh, I think the other challenge is that the, we see an attitude of merging with young people that was different to the parents were all young people expect to stop their economic life in the way in which they've seen their parents finish their economic life.

Mark: They want to live in that nice suburb where the, at the moment, living in the parent for decades. Yes. Well that's right. And we do forget that actually the parents of today, the baby boomers achieved their wealth by starting at the bottom rung on the ladder and it wasn't the most desirable suburb. And wasn't the most, most desirable property, which shades on the windows. That's exactly the milk crate was the coffee table. You know, that's how it was. So we have lost a little bit of that in this lifestyle driven Instagram sort of aspirational world and we could learn a lot to get back to the, the start it from the ground level, build it yourself and be proud of it. And, and, and, you know, leap frog as you go.

Chris: But has the, as the baby boomer had all the, the tail winds behind them in terms of, you know, we're 26 years without a recession. Um, you know, you can see the rise of incomes, the population growth the. Do you think that they've had a lot of tail winds that maybe the next generation haven't got? They can't see that optimism?

Mark: That is true. I mean, it has been the golden age for the baby boomers. They got into property and saw those places double or treble in, in quota, you know, a decade or two. I mean, it was amazing. And that allowed them really in Australia to kick off this investment mindset, this multiple property mindset. It was the baby boomers in Australia that have ushered that in, that's now become a mainstream sort of wealth accumulation vehicle. And they have had these unique times to do that. And, and it's being discussed as if anyone can and everyone should. And on one income you can. And of course the times of change is not so possible or, or, or so easy. So I think that is true. We need to therefore maybe scale out the timeframes, maybe adjust the expectations, maybe, um, uh, alter a little bit, uh, the approach and just transform that Aussie dream. It's not just what we saw our parents have. It's still an Aussie dream that's alive and well. Young people still want to run their own place, but it might look a little different towhat they saw.

Veronica: Nothing what the baby boom is, didn't have a wealthy parents necessarily to maybe help the kids out and pass things on. So I think that the younger generations now have something different. Not that certainly my parents haven't handed anything to me. Um, but I'm still gen x remember, but to, I spoke to a fellow yesterday, he's seven, I'm guessing is 71. Um, and he wants to sell his big house and, and give each of these kids, you know, a chunk of money so that they can get on the ladder and he's not forgetting about himself he's you know, uh, quarantined off a certain amount of money and the rest of it is for him to enjoy his life. And, and I thought that was interesting that that was very much part of his motivation to sell the property and the timing and all those sorts of things around about, well, now's the time to help my kids.

Veronica: Right. Um, yeah. And I bet he didn't get that leg up from anybody. So he's had a economical leg up and the benefit of when he was born leg up. But you know, and I think that that same leg up in many ways will translate to, you know, ongoing generations. They'll just have a different advantages.

Chris: And it's interesting you say that. So let's say he's got four kids and I all get, you know, quarter of a million each. Um, you know, and they sells his formula house, let's say. Um, he goes, buys another $2 million house, et Cetera. But that all those kids take that 250 and go to the bank and I go borrow another million. And so then you've just created demand for 4, new home buyers and so off one sale. And so, you know, a lot of people think that the whole downsizer you know, thing you know, is going to create a lot of supply, but I actually think it's going to do the opposite. And the person behind the $4 million house, he's probably going be someone who's had the $3 million house and is upgrading. Um, and then there's usually more people wanting that 3 million house. Then you know that you guys, it's like a pyramid size. It's interesting, a lot of the downsides that a lot of people think, well, why all these old people are going to move out of these houses. Um, but I, you know, there's going to, already people waiting to move into these houses.

Veronica: Well actually they're not really, you know, when you've got a house like that, for instance, he's on a big block of land, right?If the neighbor who's a similar age, decides that she also wants to sell their, might actually become a development site. Yeah. Um, or you know, that house may not have been touched for 40 years and so it needs to have all been knocked down, you know, so there's those houses, uh, the, uh, what do you call them? The package home house in a box people, you know, that knocked down the house and actually put up a project home there or you know, maybe do an architectural renovation depending on where it's like located, what's, what the original house is like. So it's interesting that, that, what that does is feeds economy in other ways because quite often those houses are not the sort of house in its current form that somebody actually wants to go and live in.

Chris: Yeah. And that's what that actually is. That's a really good example of explaining how should we get shrinking supply of houses. Um, and when whenever you are in an asset, you want to have limited or shrinking supply of, you know, that's an example of it there. And growing demand that's more population growth in income for the buyers. And so it's, it's interesting talking about these things because you can see how over time things are going to really shift when generations change. You know, is it really all hype that we create these boundaries between Gen x, Gen y baby boomers? Are we really, I would really, that you're a 2009 different animal or is it, is it really, can you really see how different generations are and how we need to think about them differently?

Mark: Well, clearly the, the definitions are just banded years, you know, so that's, that just creates these, these buckets. Um, but when you compare the buckets, if you like, even arbitrary though the years may be, you are ultimately dealing with people that were shaped in eras that were 15 years apart. And so we are the product of our times. In fact, it's been said that we resemble our time is more than we would resemble our parents, which in in so many ways is true because the events, the experiences, the technologies, the life markers that leave fingerprints on us are different for each cohort. And not only is a generation defined by its times, which is different for each generation, but each generation is at a different life state. And so that has impacts. Clearly someone in their twenties is different to someone in their forties different to someone in their sixties and beyond that the times that we live through, uh, or our formative years or those different life stages, further shapes are so everyone has been in their 20s or everyone has been in their teen years. That's an adult. But, but we weren't in our teens in the 1960s or we weren't in our teens in the 21st century. And that creates differences as well. So you've got multiple factors that create generational differences that does allow some pretty solid, um, comparisons, uh, and, and some contrast. And it's not the only step to understand our society, but it's the best first step to understand the segments and who we are and what defines us.

Veronica: Yes, there's quite a lot of interesting um, resources on your website or will it attach those to the show notes here as well? Because I found them really quite interesting is even for graphics every too nice for those who don't have time or not inclined to read and there's lots of blog posts and articles there

Chris: every week we hear incredible stories of the dumb things, property buys, do dumb things that end up costing a whole lot of money and are creating a whole lot of stress mistakes that can be avoided. Please mark, can you give us an example of a property Dumbo, we can all learn what not to do from these stories.

Mark: Yeah. I was talking with one guy and we were doing some demographic analysis and uh, he was just sharing a bit of a war story that he had with a property development. He was in a regional area building, a, um, sort of like a homemaker centre, fairly reasonably sized development there and they had all the plans done and council approvals and were just are ready to break ground on it and begin. And he had this sort of more innovative idea. He wanted the parking to be in the center of this over this thing and the, and the all the, the buildings to be around the outside.

Mark: So that from a street presence perspective, you had the big walls of the center, the big advertising. It look neat. You didn't see all these cars. Uh, they did some final market research and found that it was a totally dud idea. Uh, and indeed when they looked at every other development of that type, it just doesn't work because Australians want to see where they are going to park before they get there. They don't want to drive through a narrow driveway and, and assume there's a car park behind it. It's an example where, how does that work with undercover parking though? We'll see in the cities and the cities we're used to that. But in the regional areas and in the outer suburbs, you're driving along the road, you see the place. You see there's a big car park, there are lots of parking availability and that draws you in.

Mark: If all you see is a building and no real way of is there parking there, I don't know at all getting too difficult, I'll just go to the local place, you know? Yeah. And uh, and, and it's an example of where innovation, I want clean design. I want advertising boarding on the, on the, on the street scape, um, uh, overplays or, or diminishes the understanding of human psychology and understanding the human psychology. Human behavior and attitude is key. Um, they ended up doing the more traditional design with the, the uh, the big car park around it and the building in the middle and, and it had activity from day one and I'm, and, and has been a success but, but an example of looking at the numbers, understanding of people. And that's what demographics is about. It's a study of who we are, where we live, what defines us. The numbers tell a story. Interviewing people tells a story. And by understanding of the human side of our decisions, I think it sets up well for our business decisions.

Chris: Oh, amazing. I love that though. I mean on the car parks part. I mean is there a massive shift you can see in younger generations around car ownership and you know, do we need car parks and do cities need car parks and have you done much research around that?

Mark: Yeah, it's certainly in the urban areas because cars, becoming a, almost a liability, people don't want the car because you know, where do I pay, where do I park? And I know it's on the street. I've got to move it all the time, cause it clear ways. And if I've got a spot at comes with a tarrif, I've got to pay ea year or extra expenses. So, so it's actually seen a little bit as downside. I know some developers for years ago they were telling me that for every new development they had to have a certain number of caspase, minimum car space numbers per per apartment. Now there are ceilings, uh, to the, the car space, you have to have fewer than this many car spaces per unit because they're trying to reduce the number of, of spaces and cars in the city. So that's a city change that's come about because we've got better infrastructure and because people are in an Uber era, they don't want the hassle of a car. They've got everything, you know, by foot or easy commute and that gives them the lifestyle they're looking for.

Chris: I think it's, um, interesting a lot of the new developments I've been watching 'em know they're making partnerships with Goget. And so they're not just, you know, the boring little Yaris or that, you know, they're actually, you know, SUVs and things that suit families, you know, and baby seats and things like that. So, you know, a lot of people say, well, it's great you don't need a car to, you have a child. But then we'll actually know. Now there's cars in these buildings that have got ready to have, you know, with the baby seat ready to go. So, um, you know, and there are electric and they already charged and the car port and you've already always got a park because, yeah, no, that's right. And um, you know, you can book it on an APP and well they're also doing is it's quite smart is their partner with other developments in the area and saying, Whoa, well we'll give you 20 passes to our carpark for Goget.

Chris: Because you know, and then there's this kind of cross sharing of cars. And so I think, you know, it's very interesting that people will say, Oh, you must have car parking. Uh, I think it's very important if you want to hit that family market, but a lot of other apartments, maybe not. So it's, it's always interesting studying these trends. And back in episode 70, we, uh, interviewed Sarah Wilkinson, professor of property UTS and she was talking about the future. We could be seeing farms in the car parks. Because if the all the farms or the outside suburbs are being mowed down to build a new house and land packages, then we're going to have to grow our food somewhere.

Chris: So what do you think this means for the current developments? You know, you mentioned about stock we've built, hasn't been great for what, uh, changing demographics. What do we do with, oh, the other properties that we've bought that maybe that's not what the next generation want.

Mark: Well, this was thought of, you're about those mcmansions in the suburb. Water going to be become of them. We've got fewer children per household, which has been a trend for some time. Who needs five bedroom home, six bedroom homes, you know, these big mcmansions. But they are being well used now with the multigenerational household. You got a lot of parents and their kids still at home and now they're having their own children. You've got two or three generations under the one roof. You've got the working from home set up or the Home Office or a, some people are running businesses from their homes. And so we have an ability as humans to adapt. A large city has enough diversity in terms of the attitudes that household sizes and structures to soak up, uh, this sort of demand. So I think the key for development, it's hard for anyone to predict the future, but if we can build flexibility into the design, some modular idea where it can then be suited for singles or young couples, those that are raising kids, older kids as well, and it can accommodate an aging population. So we've got wider doors or it can be retrofitted for, for the needs of older Australians. That's the sort of flexible thinking we need into the future so that our, our homes are future proofed.

Chris: It's classy. She say that cause Ikea is doing, um, you know, basically robots, sort of electric furniture. So you know, it's, you know, it's going to basically be on offer soon where they can basically go in and you press a button and your bed goes down and then it goes back up. And it's because, well, basically within your apartment you can press buttons and you open up living spaces.

Veronica: So the the room changes from being a bedroom to living room to a yeah.

Chris: But you don't have to manually do it. It was just press a button or you clap, you know, these things will happen. And that's another transformer. A transformer. Yeah. I, it's um, and you know, and if one of the biggest names in the world of furniture is, you know, basically going to take, that's one of their next big key directions. You can very much see this and apartments, um, will basically move around as you are in it to create new spaces. So it's interesting to watch.

Speaker 2: Watchh this space, dare we say thank you so much, mark, that's been a really informative chat and like usual and we get in these conversations and I think we could actually have any tire series on what is in your brain and what you're prepared to share with us. So thank you for very generously sharing your time and knowledge and uh, I'm looking forward to getting this out there for everyone to hear.

Chris: Thank you, mark. Really appreciate it.

Mark: Great to be with you. Thank you.

Chris: We want you want to make you a better elephant rider and this week's elephant rider training is,

Veronica: Let's have a quick chat about the Bank of Mum and Dad. Now. We've talked a lot about Gen y, Gen Z and Gen Alpha now and how they're going to get into the property market and certainly the impetus and the encouragement that comes from parents, which is all good and often very well meant. The thing is though, certainly in the boom as as Chris spoke about earlier, that quite often it was the parent's Fomo that you know, on behalf of their kids that was pushing them to push their kids into the property market. And I have to say, I saw this many, many times at auction. I saw it where mum and dad are there. Um, bebidding on behalf of, you know, little Johnny or little Susie and little Johnny or little Susie is actually turned to mum and dad in the middle of the auction said, no, that's enough.

Veronica: I don't want to beat any higher. But Dad, usually I haven't seen mum too much, but mostly dad sort of said, no son, no son, no daughter, you know, we can do this, I can help you. And many, many times on the back of this, we've seen young people overpay for property under the pressure of an auction because they've had the in inverted commas support of the parents. Now maybe the parents did cough up that extra $20, 30, 40, 50 a hundred thousand dollars for the property. But the thing is that they were letting their elephant drive their bidding, not actually thinking about, well what is the property worth? So FOMO is a terrible reason to buy anything. That's certainly an even worse reason to continue bidding when the price has gone beyond value. So in terms of elephant, rider bootcamp, uh, you know, it's great to get support from your parents, but generally speaking, they're not property experts.

Veronica: So that's the first thing I'd say. Just be very aware of that. They may have bought one or two properties in their lives. They may think they've done really well in property and they may well have, is that been luck as it been good circumstance or has it actually been through design? Generally speaking, it is not been through design. The next thing I would say is it, so you know, be careful turning to them for advice and it's great for them to give you support, but don't let that determine what you buy. You know? I know some parents will say, well I'll support you but you have to buy this, there. Or you know, I don't buy that type of property because I don't, you know, you're too far from me or I don't believe that's a good property or whatever it, you know that's risky when money is given with strings attached, right? You've got to be careful because at the end of the day you are going to be the one that is left with that property and left with the responsibility of that property and property carries a lot of risk in a lot of responsibilities. So Bank of mum or dad is great. It's wonderful to have generous parents who really want to help their kids. Just make sure no strings attached and don't let them bid for you!

Veronica: Please join us for our next episode. We're back on the data trial where interviewing Cameron Kusher who is the head of Australian Research for Core Logic. You know we tried to trap Cameron into giving us some real inside Intel and in some cases we were a little bit lucky, so listen on because what we are going to find out is what is the most misleading data that is out there? What is the most important thing to do with data and we do talk about my favorite report, which is the pain and gain report. We're going to talk about the impact that the property market slowdown as had on a property selling at a loss in Australia. What are some of the weaknesses in Australian property data, but also what is the most data to take notice of in isolation? Please join us.

Chris: Don't forget we're on all the social channels. We're on Facebook, we're on linkedin or on Twitter

Veronica: Or you can connect with us. On the elephant in the room.com today, you, the links are all there for you.

Chris: Please connect and send us a message we'd love to hear from you.

Veronica: The elephant in the room property podcast is recorded. The Sydney sound brewery. This week's podcast was recorded by John Rhesk, editorial by Gordy Fletcher. Until next week, don't be a dumbo!

Veronica: Now remember, everything we talked about on this podcast is general in nature and should never be considered to be personal financial advice. If you're looking to get advice, please seek the help of a licensed financial advisor or buyer's agent who would tailor and document their advice to your personal circumstances with a statement of advice.

Veronica Morgan