Is geographic isolation jacking up living expenses for young Australians? Jess Cammerman investigates.
For the vast majority of Aussies, it is no secret that Australia is an expensive place to live. Most notably perhaps for the younger generation, purchasing a property now appears far more out of reach than it did for their parents. However, the high cost of living also impacts pretty much every other facet of life too. Is this a specific problem for Australians or part of a wider global trend?
While you can’t isolate Australia, or any other economy for that matter, from global financial patterns, it does appear that the country is a special case in point. Earlier this year, Australia was ranked as the world’s fourth most expensive country, cheaper only than Switzerland, Norway and Bermuda. More specifically, the Economist Intelligence Unit ranks Sydney and Melbourne as the third and fourth most expensive cities in the world, making them more costly than London, Paris and New York. By the way, Brisbane and Perth are tied for twenty first spot. Of course, a major factor in these statistics is the cost of housing – Renting is 26% more expensive in Australia than it is in New Zealand and 36% more expensive than the United States.
However, it’s not just housing that hits Australians in their pockets. A survey showed that Aussies pay a whole lot more for regular consumer products such as razors and a pair of jeans than Americans, Brits, Canadians and New Zealanders. Even a can of coke is significantly more expensive in Australia. And while Aussies pay on average $18 for a packet of cigarettes, Americans pay just $6.72.
There are of course some insurmountable problems that are unique to Australia which contribute to this expensive reality. The country’s distance from the source of many products means that high transport costs often need to be factored into the retail cost. In addition, our sparsely spread out population can also mean higher than average transport costs within Australia for a product to actually reach the customer. Meanwhile, tech and online entertainment often costs more in Australia – just check out the price of iTunes Australia downloads in comparison to iTunes USA. Again, geographic isolation means relatively little choice of provider which inevitably drives up costs.
Somewhat counter-intuitively, even the relatively high wages in Australia can come back to bite. For example, while the average waiter might earn more in Australia than in many other comparable Western economies, this is usually a cost which you can be guaranteed will be passed on to the customer.
There are of course no golden answers to solve these problems in one fell swoop. Fortunately though, there are some solutions. For first-time homebuyers trying to scrimp together enough money to purchase a property, there are at least some reliable mortgage brokers like 1300homeloan that can handle loans across the country. Meanwhile, when it comes to downloading online content, it is worth considering third-party providers or a virtual private network to bring down the cost. So although high costs just seem to be a part of Australian life, there is at least some prospect of reducing your expenses.
