Most Australians think economic future is bleak

Soaring housing and living costs among causes, economists say

SYDNEY - Economic pessimism is on the rise in Australia, according to a new study released on Tuesday, with over two-thirds of Australians believing their children will be financially worse off than themselves.

The international study conducted by the Pew Research Center discovered that in countries such as Australia and Japan, economic negativity is prevalent regarding the financial prospects of the younger generation.

Results varied across the Asia-Pacific region, and revealed Australians are far more negative about the economic prospects of their children, compared to respondents from other countries such as India, where 76 percent said they believe the younger generation will enjoy better financial prospects than they did.

While the global survey found 60 percent of Australians feel positive about current economic conditions, many economists attributed soaring housing and living costs, and slow growth in wages, as the primary causes for the plummet in positivity about Australia's economy, and are indications of problems the younger generation will face in coming years.

Paul Dales, economist at Capital Economics, said on Tuesday that the main reason behind the "gloomy outlook" are increasingly inaccessible housing prices.

"You can't escape the discussion about how hard it is to get into the housing market and that's what is at the forefront of people's minds right now, that it's going to be harder to find a house than it was for them 20 or 50 years ago," Dales said.

"There is also the factor that Australia has had a once-in-a-lifetime mining boom over the last 20 years or so and that's not going to be repeated, so you're not going to have these booming conditions, but you are going to have a period where the younger generation finds it very hard to get into the housing market."

According to an government report, housing affordability has consistently declined since the early 1980s, and the price to income ratio index revealed a shocking 78 percent increase between 1980 and 2015.

Rising house prices have led to a steady decline in the number of homeowners across Australia, according to the Australian government, with the eastern states in particular reflecting this alarming trend. In Victoria, there has been a 7.8 percent decline in owner-occupied homes and a 4.3 percent drop in New South Wales.

Spokesperson for leading Australian consumer advocacy group CHOICE, Tom Godfrey, said Australians are feeling the "pinch" and, as well as housing costs, it's the bare necessities that are taking a toll on the average Australian's finances.

Xinhua