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Could shared ownership help Sydney's housing affordability crisis?

Houses on the coast of Sydney harbour Image copyright Getty Images

Perhaps buying a house in Sydney, Australia's most expensive city, should be an Olympic event. It takes stamina, meticulous planning and very deep pockets.

House prices here have jumped by almost 60% in the last five years, while apartments have risen by 44%, according to figures from corelogic.com.au.

There are many reasons why, among them record low interest rates, generous tax breaks for investors and foreign buyers.

With a young family to support, Claude Robinson, 46, whose wage is above the national average, says house prices are "out of control, astronomical". As each month passes, he sees his chances of buying a home in Sydney receding as prices continue to spiral.

"It is a difficult market to get into for someone like me," he tells the BBC at his rented flat in the suburb of Campsie.

"I earn a decent wage of about A$85,000 (US$65,000; £50,000) a year but to try and support my family, pay my rent and get a 10% deposit is just an impossibility.

"The old Australian dream of owning a home is not a reality any more."

Image copyright Claude Robinson
Image caption Claude Robinson has a young family to support and is struggling to buy a home

Now a coalition of charities in New South Wales wants to team up with first-time buyers who otherwise would be locked out of the market.

The aim of a shared ownership scheme is to help people earning between A$70,000-100,000 a year, including teachers and police officers, who don't qualify for council or social housing but can't afford to buy on their own.

"It is really fulfilling what I think is a dream for most of us, which is to own a home," says Wendy Hayhurst, the chief executive of the New South Wales Federation of Housing Associations.

She says the initiative would be a practical way to address an affordability crisis.

"You will take out a mortgage for your share and the community housing provider will pay the rest of a mortgage on that property, and at some point if your income goes up you can buy another slice of that property.

"So as your life changes as you become richer, you can eventually own the whole house - it is a leg-up."

Similar schemes run in Britain, along with others in Western and South Australia. One idea would be for charities in New South Wales to build or buy a block of flats, where the rent from tenants would subsidise those in the shared ownership partnership programme.

Image copyright Getty Images
Image caption The property market in Sydney is red hot

Claude Robinson sees it as his only realistic chance of reaching the first rung on the property ladder in a red hot market.

"I think over the last 10 years I've heard two or three times: 'Oh, it'll burst, it'll burst, but it hasn't; it just keeps going up. It is a liveable city, it is a beautiful city but it comes at a huge cost financially."

On the other side of Sydney's glittering harbour in upmarket Seaforth, a crowd of potential buyers and sticky-beak, or inquisitive, neighbours is gathering for that great Australian tradition - the onsite auction.

It's backyard theatre where property ambitions are realised, or dashed.

Up for sale is a rundown four-bedroom cottage that is in need of a renovator's careful touch. Set beside parkland on more than 600 sq m, the property first sold for A$23,000 in the early 1970s. How times have changed.

Cajoled by the sleek patter of the auctioneer, the assembled bidders slowly begin to show their hands.

Image caption Nikolai and Vita lost out in the auction

A young migrant couple from Russia, Vita and Nikolai, make the first bid of A$1.3m. They would offer no more and end up disappointed.

"It is hard, especially for young families to buy a house nowadays," says Vita. "It is quite demoralising at the moment."

The hammer eventually came down with the price in excess of A$1.7m.

"It is a huge boom. Interest rate cuts have a lot to do with it but Sydney is a very desirable place to live. It is becoming more and more expensive," explains real estate agent Trent Brewer.

I ask him if he sympathises with first-home buyers in a city like Sydney?

"My heart goes out to them, it really does," he says. "The median house price in Seaforth is A$2.1m. For a first-home buyer to get into somewhere like Seaforth it is virtually impossible without the assistance of family members."

Image caption Property auctions are great theatre - and attract a crowd of would-be buyers

Not everyone, though, is daunted by trying to scale this real estate Everest, and one prospective buyer at the Seaforth auction told me that prices were not insurmountable.

"I think the media is really hyping it up a lot at the moment, so I don't think it is too much of a problem. As long as you've got good jobs (and) reasonable incomes you should be able to cover mortgages.

"It's more just a matter of getting in and actually finding the right place before other people do."

In Sydney, the median house price over the three months ending in July was A$880,000, and A$670,000 for apartments. Few expect those figures to fall anytime soon, although a building frenzy could leave Australia's most populous city with a glut of flats that could put downward pressure on prices.

But for many Australians the property dream is slipping away. Research from the University of Melbourne predicts that fewer than half of Australian adults will own a home by next year, down from the often-quoted figure of around two-thirds.

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