Date
23 August 2017
“When I was buying my first home, I wasn’t buying smashed avocado for 19 bucks and four coffees at $4 each”, Australian property tycoon Tim Gurner told 60 Minutes TV show. Photo: 60 Minutes
“When I was buying my first home, I wasn’t buying smashed avocado for 19 bucks and four coffees at $4 each”, Australian property tycoon Tim Gurner told 60 Minutes TV show. Photo: 60 Minutes

Why an Australian property tycoon drew the ire of millennials

Australian property tycoon Tim Gurner, 35, has found himself at the receiving end of a torrent of criticism from millennials after he made some comments on why youngsters find it hard to afford a home nowadays.

“When I was buying my first home, I wasn’t buying smashed avocado for 19 bucks and four coffees at $4 each,” Gurner told 60 Minutes TV show, suggesting that young people nowadays spend too much money on frivolous things.

“I sacrificed a huge amount through those years, working multiple jobs, seven days a week and I saved absolutely every penny that I could.

“There is no question we are at a point now where the expectations of younger people are very, very high,” he said, advising the millennials to get realistic about their expectations.

“They want to eat out every day, they want to travel to Europe every year. This generation is watching the Kardashians and thinking that’s normal. Thinking that owning a Bentley is normal, that owning a BMW is normal.”

The comments caused outrage among millennials in Australia, who blamed skyrocketing property prices, rather than the spending habits of the youth, for rising housing unaffordability.

Home prices in Australia have rallied over 40 percent over last four years, and gained 10.9 percent last year alone, according to data from CoreLogic.

Big cities like Sydney and Melbourne even posted a price increase of nearly 60 percent over last four years. In comparison, home prices in Hong Kong have soared just 33 percent in the same period.

Gurner has made his fortune from Australia’s property boom.

He was ranked the 141th richest man in Australia last year with a personal wealth of A$460 million (US$342 million).

Some netizens argued that Gurner’s claims of self-made success are not entirely true.

According to an interview Gurner did some years ago, he borrowed money from his grandfather to make his first investment.

Gurner hit back at the critics and revealed that he had actually saved A$12,000 as seed money. Then he borrowed A$34,000 from his grandpa and another A$150,000 from a bank for his first property investment—an old gym.

He renovated that and sold it a year later for a tidy profit, setting him on course for bigger things.

The young millionaire said he appeared on 60 Minutes to focus on a really important issue about housing affordability, and that the comments were part of a much bigger discussion on how people can get into the market and the necessary planning and policy moves that can bring about change.

He said he was disappointed that “trivial” comments overshadowed the important issue of housing affordability.

Whatever be the case, the controversy has served to highlight one fact: the widening wealth gap between those who own properties and those who don’t has become a very sensitive topic.

In my opinion, both Gurner and the Australian youths are right in some sense. Property prices have indeed surged and made housing less affordable. But at the same time, there might be something wrong with the younger generation’s spending habits.

This article appeared in the Hong Kong Economic Journal on May 19

Translation by Julie Zhu

[Chinese version 中文版]

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RC

Hong Kong Economic Journal columnist

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