First Home Guarantee 2026: Will It Help or Hurt First Home Buyers?

We’re back with more Finance Show with Joe in 2026! Now with our new co-host, Milad Amin!

There’s a saying that to understand the future, you have to understand the past. We’re doing the same thing here, trying to predict 2026 by looking at what happened in the Australian property market in 2025.

From expanded government schemes to rate cuts, we get into it all while cracking a few jokes along the way. 

Follow us for more property news and mortgage advice! 

▸Website - https://itssimple.com.au
▸Instagram -  https://www.instagram.com/itssimplefinance/
▸Facebook -  https://www.facebook.com/itssimplefinance/
▸LinkedIn - https://www.linkedin.com/company/itssimple/

DISCLAIMER This podcast contains general financial information only. That means the information does not take into account your objectives, financial situation, or needs. Because of that, you should consider if the information is appropriate to you and your needs before acting on it.

Transcript

Cold Open: Prices And Pressure

SPEAKER_01 0:00

Something that used to cost a million dollars is probably worth 1.1 now. That's a hundred thousand dollars increase. The average age of the first home buyer across Australia went up from 36 to 39. You aren't building enough dwellings already, and you increase a population size. All it does is increase the pressure on the demand. Okay, we need to be doing things faster. But unfortunately, we've looked in the opposite direction. So, anyways, let's talk about that.

SPEAKER_04 0:34

Happy New Year, everybody, and welcome to the finance show with Joe. He's Joe, I'm Michael, and today we're talking about what happened in 2025 in the housing market. Please be aware that all the advice in this episode is general in nature.

SPEAKER_01 0:46

And if you do need specific advice, make sure you contact your finance professional.

SPEAKER_04 0:51

And with the disclaimers out of the way, let's get on with it. Michael, did you have a good break? I did have a good break. I did. Busy, but also relaxing. I was just, you know, doing the usual Christmas, New Year's shit, going up and down the coast, all visiting all the families, in-laws, all that sort of stuff. And then for the last week, I got to actually like lie down. What's that? I know, crazy. Foreign concept to you, I know.

SPEAKER_01 1:14

I actually had my first but not sleep last night in like four weeks. Really? I got seven hours uh uninterrupted.

SPEAKER_04 1:21

Wow. It was big for you.

SPEAKER_01 1:22

Oh, I'm still tired, but I'm so happy. We went to Hawaii.

SPEAKER_04 1:26

Oh, yeah, and I saw that online.

SPEAKER_01 1:28

How was that? Uh Maui is awesome. Maui is fantastic.

SPEAKER_04 1:32

Yeah.

SPEAKER_01 1:32

It's like the south coast of Sydney meets America. So it's not overly dense. You can still uh relax quite a bit. The beaches are beautiful and wait, who the fuck is that guy?

SPEAKER_04 1:44

I was I was wondering. He's just in there watching.

SPEAKER_01 1:49

Guys, I'd like to do a brief introduction. Well, not a brief introduction, we're gonna do a full introduction. His name is Malad Amin. Malad, welcome. And you moving forward, you're gonna be a co-host on this show. Am I correct in saying that?

SPEAKER_00 2:03

I believe so, yeah. Yeah. But to be honest with you, seeing that introduction, it's like how you guys are doing so good at these naturals.

SPEAKER_01 2:11

I do want to ask a little bit about your history, dude. Um, could you just tell the audience where have you come from? You know, just all the fun stuff. Where did you get your haircut?

Millad’s Background In Business Lending

SPEAKER_00 2:22

Uh to be honest with you, let's start with a haircut. Um, no, I'm only joking. Um, yeah, so look, the last eight years um of my career, I probably spent the majority of it doing business lending unsecured. Um, and then for a little bit of a period, I decided to go from lender side to start working for brokers. Um, and the journey has been, you know, it's it's been quite the wave, but it's been good. Um, so now obviously what working alongside yourself, Joseph, and the team had it simple. Um, it's been uh a very good experience in terms of getting to understand mortgages. It's my first time actually touching mortgages, right? And even in saying doing mortgages, not really doing the mortgages, right?

SPEAKER_01 3:05

So very on this show now, and I would you'd agree with me. We're called the Financial Joe, but truly we've been talking about property.

SPEAKER_04 3:12

Yeah, really broadly, uh government.

SPEAKER_01 3:15

Okay, but now despite my best efforts, and now with Millad actually coming in, we get a whole different perspective and talking about the business side of things, yeah, absolutely, and where we can support small businesses with their cash flow, absolutely, and where with the larger purchases and with assets and everything, we've got people walking past. Apparently, we're an aquarium. I am a fish, and people are just like, hello, fishy! And I'm like, Yeah, all right, this is gonna happen.

SPEAKER_04 3:39

You should see our studio from the outside of the glass wall. It looks like it's so well lit and bright, it looks like the sun in here.

SPEAKER_01 3:46

Um, but yeah, Milan, we are excited to have you a part of the team, Michael. We are excited that for another year.

SPEAKER_04 3:53

That we're still doing this show.

SPEAKER_01 3:54

Oh god, I'm so tired, guys. I'm so tired of this government. So, anyways, Michael, what do you want to know?

SPEAKER_04 4:03

I want to know, is there any hope inside it? I want to know just should I wake up in the morning and not like you know, have these feelings of dread pulling me down? That's uh I'm sorry, I thought it was in therapy.

SPEAKER_01 4:18

No, mate, you're on casting couch. Um we're not gonna accomplish anything today, are we?

SPEAKER_04 4:28

No, I don't think so.

2025 Supply, Migration And Price Surges

SPEAKER_01 4:30

Is there any hope it's such? Um it's a very interesting question. I'm gonna start off with the housing supply issue. Yeah. Now, housing supply surprisingly actually increased marginally from the previous year. 1%. Okay.

SPEAKER_04 4:46

So in finally a reason to get out of bed.

SPEAKER_01 4:50

In 2025 calendar year, we built 187,000 new dwellings. That is up from the previous year's 1505,000 new dwellings. So you know, yeah, but no, yeah, it's increased a little bit, but 1,800 new homes with the amount of net migration that we've had. Now we don't have the exact figures yet for the net migration, but we had 554,000 long-term students and long-term visa holders move to Australia in curling the year 2025. Now, quick maths off the top of my head. That's three people to every dwelling, which doesn't sound too shocking. However, that's 185,000 new dwellings for the entire population of Australia.

SPEAKER_04 5:41

And it's not just migration that and you know, boosting numbers after.

SPEAKER_01 5:44

You also you have to remember we have people that are in high school right now that are turning 18.

unknown 5:48

That's true.

SPEAKER_01 5:49

We have people who are have been born in Australia, who have been brought up in Australia, that are now looking to purchase their first home. And unfortunately, we are not building enough. We are going to get really into that, but there was a lot of changes that actually spiked the inflation up and increased the prices of homes.

SPEAKER_04 6:12

Yeah, it was a it was a lot of I thought uh short-term band-aid fixes, which so like we you know, we'll we'll get into this as well, like the schemes and stuff, particularly the the first-home buyer scheme, which that like granted, it did help first-term buyers in the calendar.

SPEAKER_01 6:27

No, pissed me off. Sorry, though. I just want to talk about a couple of items, all right? So let's talk about the housing prices. Let's talk about Cotality's report for the calendar year 25 and how prices uh increased. I'm just talking about quarters. Okay, so the final quarter from September to December 25. Listen to this. So Sydney went up 0.8%, not too bad. Okay, 0.8% across a year, 3.2%. That's really that's effective. That's probably in line with inflation.

SPEAKER_02 6:59

Right.

SPEAKER_01 6:59

Melbourne also 0.8 for a quarter. Okay. Brisbane 5.6% in one quarter.

SPEAKER_02 7:08

Yeah.

Caps, Age Creep And Rent Rising

SPEAKER_01 7:09

Perth, 7.6% in one quarter. Hobart, 3.6%.

SPEAKER_04 7:15

Darwin, fucking Darwin. I was gonna say, like, we've never really had to talk about Darwin because it just doesn't come up very often.

SPEAKER_01 7:23

Oh, we're gonna talk about it a lot in this episode. 5.4% and Canberra 2.2%.

SPEAKER_04 7:28

Yeah.

SPEAKER_01 7:29

Now, where did the prices increase the most? They increased in the bracket for the first home buyers.

SPEAKER_04 7:36

Oh, yeah, absolutely. And then we talked about this last year. Either investors are gonna are gonna snatch up those properties or first-home buyers are gonna snatch up those properties. But regardless, there's gonna be competition and demand for those properties, correct, which is gonna increase prices.

SPEAKER_01 7:47

Correct. That is uh there's no assumptions being made. No, when you aren't building building enough dwellings already and you increase a population size, all it does is increase the pressure on the demand. Okay, we need to be building homes faster, but unfortunately, we've looked in the opposite direction, and we have instead inflated the values of any home that was up to one and a half mil, depending on what state you're in, all that sort of stuff. Yeah, up to one and a half mil. We've inflated the value on all of those properties. So something that used to cost a million dollars is probably worth 1.1 now. That's a hundred thousand dollars increase. And people say, Oh, but look how much money I'm making. I made this much money on my investment. Yeah, okay, cool. What are you gonna do with that money? Oh, what you're gonna refinance and you're gonna go buy another thing. Well, unfortunately, it's gone up. The prices have gone up as well. So all we've done is force the people who are starting off, okay, looking to buy their first home, looking to you know, purchase their first investment, those types of things. It's actually set them back. It has set them behind. And we saw this because the average age of the first home buyer across Australia went up from 36 to 39. So people now have to delay when they're purchasing their first home.

SPEAKER_04 9:07

Yeah, oh no, absolutely. And that's well, you you mentioned before that um, you know, a bunch of 18-year-olds are now move, you know, thinking about moving out. I think that is kind of that yeah, I don't think that really exists anymore because what what are you gonna do? Where are you gonna go? Yeah, even if you're renting, where are you gonna go? It's still expensive.

SPEAKER_01 9:24

Yeah, well, rents have gone up as well.

SPEAKER_04 9:25

Yeah, everything's gone up.

First Home Guarantee Changes And Consequences

SPEAKER_01 9:27

Reds have gone far. Uh yeah, inflation's far. Um, people might not understand the key changes that occurred. The changes that were brought in to the first home guarantee were first off, they increased all the price limits. Okay, so I've done a video on this before, but the biggest one was New South Wales. The previous limit, I believe, was 900,000. Uh 950, how do you think? 950, it was one of the two. It was 900 or 950,000. They increased that limit up to 1.5 million. In previous years, if you were looking to access this scheme with a 5% deposit, the maximum purchase price was going to be$900,000. And what that did was actually control how much the property grew. At the same time, they only allowed access for up to 40,000 people nationally to be able to access this scheme. Why? The scheme was to help first home buyers that were low-income earners. It wasn't created just for first home buyers, it was created for first home buyers who are low-income earners. Because if you're a police officer, if you are a uh teacher, a teacher. Yeah, if you uh no nurses still make good money on overtime and stuff, but you know, I'm not gonna get too far into that. Okay, but this show shows in about how much nurses wages. Yeah, um, no, guys, I do the fightance, I see how much nurses make, make better money than the teachers and the police officers, you know. If you are, let's say, a cleaner, okay, someone who is a low-income earner, it still gave them access. The change that they did was they removed the income caps. So previously, the maximum you could earn to access the first time guarantee was$125,000 a year. Not$125,000 and$1, it was$125,000 per year to access the maximum 5%. They got rid of that completely.

SPEAKER_00 11:20

But this is the part where I'm confused. Okay, when the government announced this news, some people were happy, and then there was a lot of mortgage brokers, especially yourself, that was really surprised and frustrated with the government for doing what they did. How does the government not realize that this is where they're going to be faced, like they're going to be facing this news? Like, how is it that they go live on something with you know proudly, yeah, and then you know, the the top 10% mortgage brokers are saying this is terrible? Like, how do they go live on this?

SPEAKER_04 11:50

I think it's I think it's honestly just a political, political play. Typically, Labour voters skew taught like younger, just typically, not broadly, and helping first-term buyers is essentially helping their voter base, but it was such a short-term thing, like what we were saying. Like, I think it was just a political play. I don't think it was an economic.

Political Plays And Perverse Incentives

SPEAKER_00 12:07

But see, even on a political play, which I would, you know, logically that's what it sounds like. Yeah, but it it didn't work. No, it didn't really.

SPEAKER_01 12:14

It backfired tremendously. Can I put my tinfoil hat, tinfoil hat on? Let's do it. So there's been some recent announcements from the India, the Indian government chamber of commerce and their leading economists, where they said uh Australia will now give permanent residency to people from India. You don't need university qualifications, you don't need this, you don't need that. Okay, you can go to Australia and you can get a permanent residency. But there's also there were rumors of a backdoor deal where the Australian government was getting India to build our houses here. So what I think is actually occurring is ALBO is getting paid some money um from some, you know, random trust in India. Where potentially we're bringing in their people, we're increasing their GDP at the same time. Um, I don't know exactly how, they might be using some LLC or something like that to transfer money across because nobody knows who's actually building these government buildings, like the help to buy scheme stuff and the the Housing Australia Future Fund and all that shit. Nobody actually knows like who's building it, nobody knows who's won the contract. Um, and then the way that they're supplying and they're actually putting people into those properties is they're literally pushing the migration over here. That's why we've seen such a large migration, especially when it comes to India moving to Australia. That's not a racist comment, guys. That is literally just that's yeah, migration.

SPEAKER_04 13:40

You know, yeah, the it's interesting. I uh because it's an interesting theory. I only reason I don't cop it fully is because they've recently made the uh university um to get into university way harder for it for Indians. How recent? It was it was in 2025.

Shared Equity: Help To Buy Explainer

SPEAKER_01 13:56

I can't I can't remember which which years this would have been all done before. This is the thing, these plans have been rolled out over years or planned for years and stuff. It it takes a while to set up a trust, it takes a while to set up those things. So if everything that we're feeling now was planned probably 12 to 18 months ahead of time.

SPEAKER_04 14:21

No, no, no, it's it's well that's the craziest thing I've ever seen.

SPEAKER_01 14:24

Yeah, but that's the thing.

SPEAKER_04 14:25

Yeah, let's go back to houses. Um so okay, the schemes. So we we've been we mentioned it first-term guarantee, help to buy, all that sort of stuff. We mentioned how the first-term guarantee has contributed specifically to increasing property property prices for those gaps between like up to one and a half mil.

SPEAKER_01 14:45

Yeah. After one and a half mil, we've actually seen property values go down. Exactly, yeah. So communism. Um, but the second thing on that, and what Australia uh mentioned to you, Milad, so they got rid of all of the income requirements. So you earn$50,000 a year, I earn$500,000 a year, both of us are first home buyers. He's got no competitive advantage over me at an auction now. Okay. Previously, his competitive advantage was I can buy with just a 5% deposit. Okay. I can go and bid on that apartment. My competitive advantage is I work in a very high end corporate job, I can save a 20% deposit. Okay, so there's it was more of a balanced playing field for those people that needed the houses that were lower income earning. They got rid of that. So anyone that was earning over 125, 150, they're going all the way up to 500,000, as I said to you previously. They're now able to go buy their first home with just a 5% deposit. That was my main thing that I was angry about. The second thing that I didn't like is the fact that they got rid of the amount of people that could apply for this scheme. In previous years, it was up to 50,000 people.

SPEAKER_02 15:50

Yeah.

Trade‑Offs, Restrictions And Wealth Building

SPEAKER_01 15:50

Okay. Got rid of that completely. They got rid of it. And now all of a sudden, um unlimited amounts of people can apply for the 5% scheme. So you're gonna have a lot more people buying, you know, uh, you're gonna have a lot more people getting access to this scheme and being able to purchase these homes, and it's gonna be the higher income earners. Whoever's a low-income earner, you're you're done. Like, I'm I'm gonna be I'm gonna be honest. You're like, you're fucked.

SPEAKER_00 16:17

But playing playing devil's advocate, do we actually know what the stats are for the higher income earners in terms of how much they bought within the scheme compared to the you know, the ones that are earning a little bit less? Yeah. Who's actually using the scheme? Yeah, who's actually using the scheme? Do we have the stats?

SPEAKER_01 16:32

No, we don't have the stats yet, but thank you for asking that question. I am definitely going to put a tinfoil hat on tonight and do some deep research on it.

SPEAKER_00 16:39

Yeah. I think it'll be interesting to see.

SPEAKER_01 16:41

Tune this for episode three. We'll we'll get back to you on that. Um, the second scheme that they introduced, Michael, and this came out, I believe it started on January 1st, is the help to buy scheme. Have you seen this one?

SPEAKER_04 16:52

Yeah, yeah. So basically, what the government uh it has a 40% equity into your house that you buy, right?

SPEAKER_01 16:59

If it's a brand new home.

SPEAKER_04 17:00

If it's brand new, okay. Okay.

Who Really Benefits And Broker Limits

SPEAKER_01 17:02

So all you need is a 2% deposit, and you'll be able to access and purchase one of these properties. Okay, a property. The government will contribute 30%, okay, if it's an existing dwelling and 40% if it's a new dwelling. And this is where my theory of they've got an LLC with an Indian government, da-da-da. So then they're using Australian government money to help purchase these things, so then they'll have 40% ownership. Anyways, this is actually something that the Singaporean government has. Okay. So a lot of people don't know this. This isn't a unique scheme to Australia. A lot of governments around the world actually have a similar scheme. And this is how a government can both increase their GDP and increase their value, their the asset book that they hold. You know, America's got oil, we've got property, we've got that sort of thing. We've got land, yeah. Uranium or whatever it is. It doesn't feel like we've got land, but yeah. Yeah. But basically, what it is, is it's just the government uh getting a piece of the pie. Yeah. All right. They're using the low-income uh earners in this bracket. So if you earn up to$119,000 as an individual or$160,000 as a couple, you can apply for this. But here's the key issue: this doesn't work the same as the Garantor program. This is literally the government owning part of your house. Okay? So, Milad, you want to use the 2% scheme. You pay for the council rates. If it's a strata title building, you're paying for the strata.

SPEAKER_00 18:23

The full amount or full amount of rata.

SPEAKER_01 18:26

Okay, you're paying for the water bills, you're paying for the internet, you're paying for everything.

SPEAKER_00 18:30

But that that kind of like that sounds fair because I'm the one living in the house, right?

SPEAKER_01 18:34

Okay, let me go to the next thing. You're the person that's maintaining the property, and then when you sell that property, guess what? The government, their value also increases.

SPEAKER_00 18:46

But devil's advocate again, without the government, would I have been able to purchase that? Not myself specifically, but would the average person be able to purchase that house? Are they helping you enter the market earlier?

SPEAKER_01 18:58

That's a great question. It is helping short term, but when you're the person that's covering all the bills, when you're the person that's covering all the repayments, all right? Mortgage and everything, because government, yeah, they're gonna say that they print money, yeah. But then when you go to sell the property and their value has increased, or when you go to refinance and their value has increased, then you're not really getting ahead.

SPEAKER_00 19:22

I see where you see the problem.

SPEAKER_01 19:23

Yeah. The other problem is you can never make that property an investment property. You would need to buy the government out.

SPEAKER_04 19:30

Yeah, I was about to ask, can you buy, can you buy it like fully yourself? Like that's an option.

SPEAKER_01 19:35

Where are you gonna get 40% from?

Evidence Of Demand Shock In The Data

SPEAKER_00 19:36

No, no, like over time. But that goes back to so sorry to interrupt, that goes back to my question of without them, would I have been able to purchase the home in the initial place?

SPEAKER_01 19:44

Yes, but as an individual, you can't own a secondary asset after you purchase that initial home. Understanding like it's it's cooked, and you can't refinance and grab equity from that property to go buy an investment and all those sorts of things without removing the government as a shared owner.

SPEAKER_04 20:00

Yeah, I guess the idea is it's that it's supposed to be a home and it's not it's not a place to build wealth from. Um, and I guess the idea is because if you're a lower income, right, you don't you're not necessarily gonna have that much money to invest, regardless. Yeah. So may as well have a place to live. I guess that's the thinking process if I'm being charitable, right?

2026 Outlook: Rates, Lending And Trusts

SPEAKER_01 20:18

And I understand the thinking process behind it all. I will tell you now, I'm not an advocate for it. Okay. I see the government's playbook on this thing. Hey, let's create a secondary asset class for us to be able to grow our GDP and let's be able to grow our um, let's grow our asset books so that when we need to borrow money from other countries, we've got all these assets that they can potentially borrow from. Like this is the way that the government thinks. You have to remember there's economists involved, there's financial advisors involved, there's all these other key individuals involved. One of the advisors is in our building, PWC, they're just downstairs. Okay, they are an advisor to the prime minister. Guess what? The prime minister has driven into our building before. Okay, with the security cars and all that sort of stuff. He comes here and he goes and speaks to his financial advisors downstairs. Do you know PWC's job? To make sure that you make money as an accountant or your books are balanced. Okay. Their job is not, they're not worried about you, Milad, or first-time buyers. They're not. You they could say that they are, they're not. Their key, their key thing that they're worried about is making sure an economy is prosperous. Yeah. Okay. And this is how they're doing it. Okay. Yeah.

SPEAKER_04 21:29

Because again, because like the reason for the big migration as well is to is to buoy up the economy and GDP and stuff like that, so the numbers look good, so we're not in deficit. That's like that, that's one of the primary economic reasons for it. Um, obviously, we know that's not sustainable. Not only is it not sustainable economically speaking, it's not sustainable like socially speaking and politically speaking, like people are uh getting fed up and upset about this. We see it on um well, we've we've seen it all over the place.

SPEAKER_01 21:54

I think the general population is becoming a lot more intelligent because there's a lot more individuals out there. That are providing uh genuine info myself. I was never a pundit. Okay. I was never supposed to get it. But all of a sudden, if if I notice something that is unfair to people that I know for a fact that this is going to be the long-term risk part of it, then I am going to comment on it. Okay. When the first when the five percent changes were announced that we're bringing it forward, we're going to October, everything. I was the first mortgage broker in Sydney to be heavily against it.

SPEAKER_04 22:30

Yeah.

SPEAKER_01 22:32

I'll go on record saying that. You can go watch when the video was released. When they ran their political campaign on the 5% scheme, this is back in May. This is back in May, okay? Before anyone of these things were announced and all that stuff, I was the first one to announce. I was like, this is fucking dumb. Okay. Those videos for good reason got hundreds of thousands of views. All right. But I am because when you notice this stuff, you call out the inconsistency. And I think what will end up happening, depending on how the government has to base their sort of these, um, that there will be changes in the future.

SPEAKER_04 23:06

Yeah.

Investors, Migration And Persistent Demand

SPEAKER_01 23:06

You have you you you did ask me a question. Are buyers using these schemes?

SPEAKER_04 23:10

Yeah.

SPEAKER_01 23:12

Help to buy one, but I don't have any statistical data on it. No, and the reason why I can say that is because mortgage brokers can't offer the help to buy scheme through the key channels. All right, through CDA, through NFA. Now, the smaller lenders, okay, they might allow you to give it access, but I'm so happy that Commonwealth Bank of Australia is not allowing us to do this because I don't advocate for this. I actually think uh you need to find out other ways to increase your GDP, not use uh someone's asset, an Australian person's asset, to do that. Okay. You have we have land, we you have contracts, you have uranium, you have gas, you have pipelines, you have all those items.

SPEAKER_04 23:52

And we stuffed up with the gas. Why why also the gas? Yeah, just the gas.

SPEAKER_01 23:58

Why are we using apartments? But, anyways, yeah.

SPEAKER_04 24:00

Oh, I do have some numbers, by the way, for the first month of um you the expansion of the first home guarantee. Oh I do have some numbers for this. So, in in that in October of 2025, about of the 57,000 homes that were purchased, 5,778 were used uh using the guarantee.

SPEAKER_01 24:21

That's 10%.

SPEAKER_04 24:23

Over the same period in 2024, it was 3,900.

SPEAKER_01 24:26

Oh my god. How many homes were sold in the same period in 2024?

SPEAKER_04 24:30

Uh it would be roughly similar. It would be roughly similar.

SPEAKER_01 24:33

It doesn't actually, this article doesn't mean that three times the amount of people are now using this game. Of course, it's going to inflate all the prices between one and one and a half million. You increase the demand by three.

SPEAKER_04 24:46

And supply hasn't really.

SPEAKER_01 24:48

And supply didn't do anything.

SPEAKER_04 24:49

Well, we we just talked about it earlier. Supply has essentially stayed exactly where it is.

SPEAKER_01 24:53

Okay, it was a one percent. So, my lad, do you now believe that the government is here to help people and we're jolly and we're doing nix ads and yay!

SPEAKER_00 25:02

We're doomed.

SPEAKER_01 25:04

Like, I get the shits with this stuff because you and I have had so many arguments about this and it pisses me off. Okay, like pattern recognition guy. Okay, just wait until you see. The guy's gonna have the prominence is gonna have a cushiony job where some random company overseas is gonna be doing the tours and stuff, and people are gonna be like, oh, when he did the five or six game, this is how much money he made. Yeah, I'm the one that's calling it that's calling it out now, you know? Anyways, it's I get what you're saying. It's a bunch of fucking horseshit. Um, you wanna build wealth, go buy money, go buy a property in Perth. No, that's it. Go buy money. Money tree.

SPEAKER_03 25:41

Yeah, all right.

SPEAKER_04 25:46

So with all that doom and gloom of 2025, what what are you expecting for 2026? More of the same, or is obviously things are gonna have to change. We do know so the trend is like so immigration is going down, and that's been consistently going down. It's not going down a lot, it's not pre-COVID levels still. So it's not like we're fine, we're back to normal. Um, so those are gonna go down. That's gonna be one thing that's happening, but what else do you see happening?

SPEAKER_01 26:13

Ah, immigration's not going down, Michael.

SPEAKER_04 26:15

But it is but it is going down because just because of political pressure, they were like Labour still doesn't want to lose an election. They don't want to pull a bill shortened and then lose the unlosable election.

SPEAKER_01 26:25

My expectation, uh we've heard a lot of rumbling about interest rate increases.

SPEAKER_04 26:31

I I think so too.

SPEAKER_01 26:33

I I've got one telltale side about about interest rates and if they're gonna go up or not. And I've I've mentioned this a million more times. Has Macquarie Bank increased their rates as in their fixed rate? Yeah. Okay. They made one announcement in December, but they haven't made one in January. Okay, now I could go through my emails. I was on holiday, I might have missed it. When they do it, four weeks before, three weeks before, anything like that, 100% that's happening. And 100% it's happening.

SPEAKER_04 27:00

Any reason why you trust Macquarie so much with this sort of stuff?

Policy Myopia And Resource Missteps

SPEAKER_01 27:03

Um, uh, it's it's been the trend since 2008. Yeah, yeah. I don't know, I don't know what back channel messages they have.

SPEAKER_04 27:10

Yeah, what contacts they have.

SPEAKER_01 27:11

I do know that their actuaries are former uh governors of the border at the RBA. Oh, okay. And they used to sit on the board of the RBA.

SPEAKER_04 27:18

So maybe they've at least got people who are thinking the same way.

Practical Advice And Closing Banter

SPEAKER_01 27:20

Yeah, so uh I know that. And when I was told that when I used to work there, that's that that's always been the key indicator to all right. When interest rates were first announced to be going down last year, the first thing like I made a video on it, okay. I was like, it was four weeks before the announcement. Yeah, Aquarius just dropped the interest rates, interest rates are gonna go down, and everyone's like, nah, don't trust. I'm like, bro, it's been happening for the last eight years, nine years. Um, another trend that we're gonna see is we are seeing a lot of lenders decrease their the amount that they will lend out to trusts and companies. So you're gonna see a lot less commercial lending or companies purchasing residential houses. And trusts purchasing residential houses because you had a lot of buyers' agents entering the market and just saying, you've got unlimited borrowing capacity if you set up a trust, buy a house, and then do this. It was very risky. And what we noticed was a lot of the lenders, they will quickly jump into a default game, then okay. A deep their defaults will increase, the amount of misrepayments will increase because unfortunately, when you are lending to that many trusts and that many companies and all those things, that stuff is going to happen. And I have a feeling that that was already happening. That was already happening to uh in the banks. Not oh, we foresee this. I have a feeling that their increased uh misrepayments was already happening, and all of a sudden, it was Macquarie first. The CBA announced it, they say George West Fact announced it. And now we've even got the second tier lenders announcing it. First Mac. First Mac isn't got isn't doing it as much anymore.

SPEAKER_04 29:01

Okay, interesting.

SPEAKER_01 29:01

So you're gonna see an increase, uh sorry, a decrease of company and trust lending when it comes to residential housing. Now, when it comes to commercial lending, like commercial property and stuff, those banks play in a very, very different space. I'm just talking about the residential side of the market.

SPEAKER_04 29:16

So, but like with is that good news for like regular people to a certain extent? It means like less competition. That's how I understand it. Am I wrong here?

SPEAKER_01 29:23

There are still there are more loopholes and companies will always find a way.

SPEAKER_04 29:26

Yeah, okay.

SPEAKER_01 29:27

All right. There are, trust me, when I say this, there's a lot, it means that the regular, the regular individual will not have the quick access that they used to via buyers' agents. Because buyers agents, do you know what they're doing? They were they're setting up, no, they'll setting up partnerships with financial planners or financial partners.

SPEAKER_04 29:46

Yeah.

SPEAKER_01 29:47

Hey, mate, go set up trusts for these customers and go buy these things and stuff. The wealthy companies, the big companies, they're still gonna find a way to do it. Because this is this is the residential side of lending. This is if uh Liam, our video producer, wanted to go buy a property in a trust. Okay. Now all of a sudden, they've decreased that. And Liam's like, oh, well, fuck. My buyer's agent told me to go set up a trust. Now I can't even use the trust to go buy this out thing. Okay. But you're still gonna see the large-scale companies, you're gonna see the people with the commercial acumen who understand the property market, who understand those sorts of things. They'll still find a way. Oh, they always do. They always do. They always do, they're all scared. Um, including myself, I'm scared.

SPEAKER_04 30:24

Um anyone who works in finance.

SPEAKER_01 30:28

I am scared. No, but it's true. Like this, they're always gonna find a way to be able to do it. Uh, another thing that I'm I forecast, they're gonna increase the cap again for the first-time guarantee. Surely no.

unknown 30:44

They will.

SPEAKER_04 30:44

Surely not.

SPEAKER_01 30:45

It'll go up to 1.8, it'll go to 1.75, 1.8. It will. They'll increase the amount that you can purchase for. Brisbane. Brisbane, I'm pretty sure they're capped, they will cap it a million dollars. The median house price in Brisbane. Hold up, let me uh let me get the stats up for you. Give me one moment.

SPEAKER_04 31:01

Brisbane's been growing for quite some time now, though, especially as a lot of investors and stuff are moving away from Sydney and Melbourne for a variety of reasons. Okay, so so same thing with Perth, right?

SPEAKER_01 31:11

Okay, so let's let me so Sydney, the maximum median value, so Sydney's median value for housing is 1.28 mil. Okay. The maximum you could use for the uh the first-time guarantee is up to 1.5. Okay. Melbourne is 827,000. Their maximum is 900. Brisbane's maximum was a million dollars. Their median value is now 1.036 million dollars. So it means a lot less people can access that scheme. Perth was 900,000, I believe. Their median value is now 940,000. Adelaide? I'm pretty sure Adelaide was 700,000. I can't remember exactly, but there's now 900,000. Darwin, Darwin was 550,000 maximum purchase price, their median uh dwelling value is now 586,000.

SPEAKER_02 31:57

Darwin.

SPEAKER_01 31:58

Yeah.

SPEAKER_04 31:58

So you're Darwin's the crazy one.

SPEAKER_01 32:00

Maybe maybe they might not make changes to Sydney, Melbourne. Maybe they won't. Maybe they'll say these five cities are gonna have increased caps.

SPEAKER_02 32:07

Yeah.

SPEAKER_01 32:07

All right, because they might want more people to migrate to those cities. Okay, which we are seeing a lot of because guess what? When you come to Australia as a migrant, it's very rare that you're gonna have$130,000 in savings to go buy an apartment in Sydney. But you might have$90,000 to go buy a house in Perth.

SPEAKER_02 32:24

Yeah.

SPEAKER_01 32:25

So they might increase the caps there and then increase migrations to the cities that aren't as populated as Sydney and Melbourne are. Victoria as a state actually has um a higher population, or no, Melbourne as a city actually has a higher population. Than Sydney does. Yeah. Okay. New South Wales still has a bigger population, but yeah.

SPEAKER_00 32:46

No, just the city, the metropolitan area.

SPEAKER_01 32:47

Yeah, the metropolitan area area. But yeah, so Sydney as a city, um, whatever the stat is, but Melbourne's as a city, it has a has a higher population than that. So I think that they're gonna increase that. I do think interest rates are gonna go up, but I have a feeling that there's gonna be a lot of um government pressure and uh uh like government pressure to get uh, you know, decrease the buffer rate that the banks have, or possibly um uh uh increase on employers to increase wages.

SPEAKER_00 33:19

So let me get this right. You think that the interest rates will go up and then at the same time there's still going to be a huge amount of demand in purchasing property in 2026?

SPEAKER_01 33:30

You can't stop the demand. If they're gonna still bring Invested demand. Oh no, no, no, invested demand is always gonna go up because you're always going to have people that need to live somewhere. If I'm bringing in 500 or so thousand people to Australia and I'm building 180,000 houses, I am a property investor and I go buy an investment property. I know for a fact eventually I'm gonna have three people living in that house.

SPEAKER_00 33:54

But at what point do people start in vet moving to Australia and then saying, you know what, we just can't afford New South Wales, we can't afford Sydney. It doesn't matter.

SPEAKER_01 34:02

It's 180,000 dwellings being built Australia-wide. Yeah, this isn't just a New South Wales Sydney thing. Yeah, okay. This is Australia-wide that they're not they're just not building enough properties. Okay, so you're gonna still have people flying here. Rent's gone up. Red's gone up 11-12% over the last over the last 12 months. If you pay 700 bucks a week last year, you're now paying 770 this year. Yeah, that's how many people are coming to this country. We're moving into uh we're literally turning into one large New York. That's what Australia's turning into. Okay, nobody owns the actual properties unless you are are you are an ultra, yeah, ultra wealthy individual. Anyone that moves to that place rents, they don't buy. Anybody that is transplanting to those cities, as in, like I live in Adelaide and I moved to Sydney, they're gonna rent, they're not gonna buy. Okay. And they're going to be these economics harvest. That's it's what Australia is becoming in total.

SPEAKER_00 34:56

See, that's very interesting because we need cops, we need ambulance, we need teachers. Where do these guys, like where guys and girls, and you know what I'm saying? Where are they gonna live? Exactly.

SPEAKER_01 35:04

And that's why the help to buy scheme was introduced. Yeah. To give them the opportunity to still be able to buy somewhere.

SPEAKER_04 35:10

It's also why people were mad about um, remember that what's that um what's that building by the by the harbour bridge that used to be housing commission? Um now no, no, no, no.

SPEAKER_00 35:18

It's it was that that that that's trying to square. It looks beautiful now.

SPEAKER_04 35:22

Yeah, now that they've done it up, but it used to be housing commission and now it's now they're just luxury apartments, I guess. Um, and that sort of trend. So I remember people at the time were arguing, it's like, well, where are the people who work who live in the city like on lower income jobs? Where do they live in Sydney?

SPEAKER_01 35:40

Um driving an hour, two hours.

SPEAKER_04 35:43

I mean, that's already the normal. Yeah, that's all that's what I what I do.

SPEAKER_01 35:47

It's uh yeah, without increase in rail and monorail or whatever. What's it called? Not the monorail metro.

SPEAKER_00 35:54

The metro metro is great.

SPEAKER_04 35:55

The metro is good, yeah.

SPEAKER_01 35:56

Metro's great. Yeah, they went up heaps in the apartments.

SPEAKER_00 36:02

So, this is the other problem that I have with all these houses getting built. The damn roads. There's the the traffic that we face, and you know, I'm talking about areas like the Hills district, for example. The Hills is bad for this. I grew up there, it was never ready for the amount of uh development that they're doing. Yeah, and like areas like Bella Vista where the average house price what is it three, four mil? I don't even know the exact amount. They're building tori's buildings to put these, you know, put Castle Hills, yeah, Castle Hill to put people into homes, but then they're not fixing the roads, and you can't really fix the roads.

SPEAKER_04 36:31

Even even in the new pop-ups of Australia, my uh I've got family that bought in Australia and those roads are shocking. Like most of them are still those farm roads with the potholes and everything like that. They don't even have lines yet.

SPEAKER_01 36:43

I drove through Austral for the first time, uh, I want to say about three or four months ago. And you are one of their narrow streets, potholes everywhere. And I'm like, people are living here, and but this is my key issue with everything that's happening. We're moving people out that way, yeah. We're not setting up infrastructure for them out.

SPEAKER_04 37:01

No, it's the infrastructure is playing catch-up, like it's they're building the houses first, but they don't have anything else there. Yeah, even there's only like one school around about there. Yeah, and a lot more families moving there.

SPEAKER_01 37:13

Uh, this is yeah, always gonna be my key thing that I will always bring up government's always short-sighted. All these things are coming, all these long-term problems are gonna come from the short-sightedness that we have now. It's the reason, you know, how the government brought in the gas and all that sort of stuff, and the way that they did that. So it's the reason why Australians aren't wealthy from the resources that we have in the ground.

SPEAKER_04 37:34

Yeah.

SPEAKER_01 37:35

Yeah, it is. But, anyways, I see a lot more doom and gloom in 2026. And my uh general advice at the end of this episode will always be the same. Okay, get into the property market, okay? Speak to a broker, understand your borrowing capacity, understand what you want to be able to do, what you want to achieve, your long-term vision and your long-term goals, all right, and work towards that. Get started early, okay? Get started before you are 18. Get started before you're 21. Get started before you're 25. Last thing, it's not hopeless if you work with the right people. As always, guys, my name's Joe. I'm Michael. And I'm Millad. Who the fuck is that guy? And thank you for tuning into this episode on Finance Show.