“Well, this buyers strike will get nowhere!”

March 30, 2011

Some people might have seen this link:
Prosper.org.au FHB Strike

And even this Getup campaign:
FHB Strike

Or read about it at Steve Keen’s blog

Or perhaps even seen it in the online Fairfax media

Or they might have heard Red Symons on ABC 774 radio this morning:
http://blogs.abc.net.au/files/david-colyer-1.mp3

It’s clear that the First Home Buyers Strike has come of age and attracted the attention of the main stream media.

Now the obvious question: what effect will all this have?

A strong theme emanating from various blogs and comments pages (of both bull and bear sites) is that this strike is useless and will not get anywhere. The votes on the Fairfax site certainly confirm this.

I’m not so sure.

I really think people underestimate the effect this can have. Sure, people won’t “strike” from buying houses forever, but I think that really misses the point. Unlike someone on a diet who rocks up to KFC and orders a Double Down, buying a house isn’t something one can simply do on an impulse or a whim.

They do say after all, that buying a home is the one of the biggest purchase you’ll make in your life so a lot of thought and careful preparation must go into it. Let’s just say that if someone logs onto Getup, and decides to support the strike today, do you think they’ll suddenly decide to start doing things like:

Think about or start looking around for the best home loan rates

OR

Think about or start applying for home loans

OR

Start looking at property adverts or websites with the intention to purchase

OR

Think about organizing convenyancing

OR

Organise things like building inspections

OR

Plan to attend auctions this weekend auctions?

Personally, I think these might be some of the last things on their minds!

One way of looking at all this is to consider a Transtheoretical framework: this is a model used to understand and manage substance abuse and dependence. For someone who is an alcoholic and has no desire at all to quit, they would be considered Precontemplative. For example an alcoholic who has at least entertained the idea about quitting but isn’t sure, would be in a Comtemplative stage, and one who is considering actually going ahead with it would be in the Preparation stage. There are other stages, but these first three are the most relevant for this example.

This is obviously overly simplified, but the same can be applied to prospective first home buyers.

Precontemplative – those who are not even considering it.
Contemplative – looking at the pros and cons of buying a house.
Preparation – thinking about organizing home loans etc.

By altering people’s planning time frame, it effectively moves them from a “preparation” or “contemplative” stage of change to a “precontemplative” stage. While it may not stop buyers who have already begun to progress down that path. However, it will set back potential home buyers.

The challenge now lies with the property industry, and how they will attempt to woo back potential buyers will be interesting to see. At the moment, there’s a lot of spite, vitriol and heavy handed scare tactics being thrown around. Judging by the dialogue, this is obviously coming up against some strong resistance which is not altogether surprising.

Will they adapt techniques similar to motivational interviewing strategies aimed at helping people move from one particular stage of change to another?

Otherwise, the downwards trend in this link below may be reflected nationally.

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