What's at the heart of the boomer vs millennial bidding war?
Our first plan for retirement went like a dream. Downsize from a capital city, Canberra, to Goulburn, a regional NSW town, and chuck the change into our superannuation. Easy.
At 60 years old my plan looked great on paper but as John Lennon said, life is what happens when you’re making plans.
It may sound silly, but my wife and I are selling our beautiful heritage house and buying back in a city market much bigger than the one from where we had downsized. The fact is our two grandsons and their big eyes, chubby cheeks and ready chuckles have lured us back into the rat race.
At open house inspections we must look like baby-boomer investors who would blow millennials out of the water at auctions, thanks to equity in a family home and savings. But without full-time jobs and with memories of high interest rates (17 per cent) and the recession of the 1980s, this is bloody frightening.
After deciding to move, we stumbled on a furious auction one Saturday morning outside a two-bedroom semi-detached home on Ormond Road, Elwood. It passed in for $1.4 million. Crap. Who can afford that?
For that matter, who can afford to buy in Sandringham, our targeted suburb, where the median house price is about $1.6 million, and $750,000 for units. Still, we decided to take the plunge and sell. Back in Goulburn, agents told us to expect about $100,000 more than Goulburn’s median of $450,000 for our sandstock, 1908 home.
Property pundits talk about millennials having to give up brunch and overseas holidays to afford a home. For us to buy in Melbourne, we need to give up a high, pressed-metal ceiling, three large bedrooms with fireplaces, a double garage with loads of storage and paved patio edged with an ornamental grape vine. More than anything else, we’re selling the privacy and privilege of owning a free-standing home.
We are taking a much closer look at two bedroom apartments in the Bayside suburbs of Melbourne. Even with foreign investors out of the market, tighter lending to discourage investors, and a glut of new apartments we discovering our war chest of selling and savings just doesn’t cut it.
Anything in our price bracket of about $600,000 is either on the second level requiring two-flights of stairs. (Walking up stairs will soon be a problem for us oldies). Or it faced south, or it was on the bottom floor in an old complex with God-knows-what raining down on us, or it was miles away from good transport.
We would need more money than what our Goulburn home was worth for an apartment and stamp duty. Plus sales commission, two lots of legal fees, removalist expenses, storage and building inspections. What a nightmare.
When we stay in Melbourne, we wake each day to a gurgling grandson, stroll along the water’s edge seeing sleek sailing yachts throwing their reflections onto the rippled surface, and dogs and their owners of all shapes and sizes ambling along the paths. For me it's worth selling our picket fence and everything behind it.
So, we set the date for the auction and crossed our fingers later a young couple with a baby, much like our kids’ families, would win the bidding. They were one of five groups who asked for contracts, and were in the race until the second last bid, only to be pipped by a baby-boomer couple just like us.
Excited as we are moving closer to family, I’m nervous about the choice we have made. I’m sure we will never love an apartment as much as that 1908 sandstock brick home.
Overwhelmed at having to find something affordable and suitable in the big smoke, we are almost settled on an apartment not far from Sandringham’s shops and railway station. East-facing with lift access, it may be the one. I’ll let you know how we go.