Housing crisis in Australia demands a national approach

Housing has emerged as a pressing issue in federal politics, capturing the attention of policymakers and the public alike. Australia is currently grappling with a multifaceted housing crisis that encompasses soaring housing costs, unaffordable mortgages, skyrocketing rents amidst a historically tight rental market, a growing homelessness problem, and a shortage of social housing. Particularly alarming is the affordability challenge faced by younger individuals, for whom property prices in major cities remain out of reach, especially for single people. The severity of the situation is apparent across the country, demanding immediate attention and effective solutions.

While there have been calls for the federal government to take a more proactive role, the complex nature of housing policy presents a significant challenge. Housing responsibility primarily lies with state and territory governments, and despite the majority of governments being Labor-led, each jurisdiction has its own housing policies shaped by varying political pressures and vested interests. Further complicating matters are the divergent local council regulations and requirements that influence housing development and planning decisions.

Recognising the need for a unified approach, it is time for the federal government to consider convening a national housing summit, providing a platform to engage stakeholders from all levels of government, housing industry experts, community representatives, and advocacy groups to collectively define the problems and explore comprehensive solutions. By understanding the unique perspectives and challenges faced by different stakeholders, policymakers can devise an overarching direction to address the housing crisis.

One fundamental issue is the stigma surrounding public housing, which perpetuates misconceptions and hampers the potential for inclusive and sustainable solutions. It is essential to combat this stigma and recognise that housing assistance, like other forms of welfare, is meant to provide necessary support to those in need. Public housing should be viewed as an integral part of the solution, ensuring secure and affordable housing for all.

Critics argue that rental laws need to be reassessed to strike a fair balance between the rights and responsibilities of landlords and tenants. Landlords contend that renters hold all the power, while tenants often feel powerless against landlords. In truth, both perspectives contain elements of truth. An examination of rental laws and regulations with an aim to establish fairer practices is necessary to alleviate the existing tensions.

To encourage housing affordability and discourage hoarding of vacant properties, reforms are required, such as reducing tax incentives associated with keeping houses unoccupied. It is estimated that a significant number of homes, particularly in Sydney and Melbourne, remain unoccupied, with reasons ranging from properties being listed on Airbnb to prolonged absence by owners – and in some cases, owners of new apartments would prefer them to remain vacant for several years, until the value of the property appreciates, and then selling the property for a profit. Addressing this issue by incentivising occupancy would not only lower rents but also contribute to alleviating homelessness.

It is also crucial to acknowledge the vulnerable groups disproportionately affected by the housing crisis. Women over the age of 55 constitute the largest growing demographic among the homeless population, highlighting the need for targeted interventions to prevent homelessness among this group. Additionally, individuals with mental health issues face challenges in maintaining stable households. Policies must prioritise the provision of appropriate support and resources to ensure their wellbeing and housing stability.

Essentially, at the heart of the housing crisis in Australia is a shortage of available homes, whether due to insufficient construction, unoccupied properties, or other factors. Increasing the housing supply emerges as a critical step, but determining the type, location, and quantity of housing presents its own set of challenges. Previous policies, such as first homeowner grants, have inadvertently inflated property prices rather than achieving their intended purpose. Piecemeal and politically-motivated solutions have failed to provide a comprehensive and cohesive vision for housing policy, necessitating a shift towards a long-term perspective.

To forge effective solutions, it is imperative to accurately identify and define the problem at hand. A comprehensive understanding of the housing crisis will enable policymakers to adopt targeted and sustainable measures. By transcending political interests and approaching the issue with compassion and foresight, Australia can establish a housing policy framework that addresses the immediate challenges while laying the foundation for a more equitable and affordable housing landscape in the future.

A delicate balancing act in the housing sector

The interconnected nature of the challenges facing the housing market, has resulted in a wide range unintended consequences resulting from previous policy adjustments by governments – such as a rise in property prices, when the purpose of such policies, has been to lower prices. The need for ethical considerations in addressing these issues also needs to be considered, particularly in relation to negative gearing benefits and living density changes.

Calls to end or restrict negative gearing benefits for housing have gained traction, with proponents arguing that such measures would align with more ethical and moral principles – why should owners of many multiple residences be expected to receive taxpayer-supported benefits, when there are many people homeless?

However, concerns have been raised about the potential impact on housing supply. Past experiences, such as the changes to capital gains tax in 1989 by the Hawke government, which led to a rental crisis before the policy was reversed, serve as a reminder of the delicate balance within the housing market.

Research suggests that the current housing market challenges have been influenced by a shift in living density preferences. The pandemic prompted individuals to opt for homes with fewer occupants, rather than shared accommodations and although seemingly a minor change, this shift has generated significant ripple effects throughout the housing sector.

While legislation cannot enforce specific living density requirements for each house, there is a possibility of passing regulations to ensure that vacant houses are occupied. However, this example of living density highlights the intricate nature of the housing sector, where even minor policy adjustments can have far-reaching consequences.

Housing is a right, not a privilege, and that everyone should have access to suitable accommodation. Addressing homelessness and insufficient housing is emerging as a primary concern in public policy, highlighting the vulnerability of those in need. A comprehensive housing policy should prioritise the wellbeing of the most vulnerable members of society.

The Labor government’s social housing fund policy has been met with mixed reactions, as some question its adequacy to address the housing crisis. Urgent action is needed to address the immediate shortage of approximately 600,000 social housing units, projected to reach nearly a million by 2040.

In addition to expanding the availability of social housing, re-evaluating outdated housing development practices is deemed essential. The dominance of profit-driven developers and the nostalgic notion of quarter-acre blocks with three-bedroom houses should be challenged. Embracing diversity in housing options, such as tiny houses and communal living arrangements, can contribute to sustainable and community-oriented development.

To address the increasing difficulty of property ownership for younger generations, there needs to be a strengthening of leasing and renting laws and longer lease options, such as five or ten years, with reasonable provisions for early termination, could provide stability for both tenants and landlords.

Ultimately, housing is a multifaceted issue requiring compassionate and sensible solutions. By addressing interconnected challenges, such as living density, affordability, community-building, and ecological sustainability, substantial progress can be made in the housing sector.

The housing crisis in Australia demands urgent attention and concerted efforts from all levels of government and society, especially the federal government. A national housing summit could serve as a pivotal moment for stakeholders to come together, align their visions, and chart a path forward that prioritises affordability, access, and support for the most vulnerable. By recognising the complexities and nuances of the housing crisis, Australia has an opportunity to shape a future where secure and affordable housing is a reality for all its citizens.