The Housing Crisis? Time for a good old fashioned White paper (23 May 2023)

Here we go again. Removing negative gearing on properties is back on the agenda. As though it is the cure-all for the housing crisis. A crisis that effects everyone including small and family business people.

We must do something more than argue and seek the moral high ground. Agree on the short-term response then come together to develop a strategic long-term solution – one that is flexible and able to change as demographics, the economy and technology changes.

What is currently lacking is a real focus on major contributors to the problem – the state governments and the local governments who all bring in a lot of revenue through high house prices creating high rates and land taxes. They give lip service to change and their behaviour doesn’t often reflect their words.

We need a white paper ASAP. A White Paper to document all the problems and all the suggested solutions – so far. It can highlight the likely outcomes coming from the suggested solutions – the good and the bad.

For example, removing negative gearing also removes the motivation for those with access to finance to purchase properties and rent them out. That in theory will free up more housing for younger people. It will also place stress on the older people who have invested their superannuation into properties where the rent funds their retirement. Nothing is ever simple.

What should be addressed in a ‘Housing White Paper’ besides negative gearing?

Let’s list some: the role of state governments in public housing availability; the role of local government in housing availability; the impact of AirBNB on accommodation; the shortage of skilled workers in the construction sector; any supply chain issues for new housing; the opportunity to refurbish any commercial buildings in CBDs as accommodation; information on rental prices and landlord behaviour; the impact on different disadvantaged groups of the housing shortage; the impact of increased migration; the different impacts on urban and regional areas; the likely impact of continued increases in interest rates; the role of governments and the private sector; and so forth.

Those invited to inform the White Paper at any initial ‘Housing Summit’ would include: local government; state governments; various Property Councils; the Master Builders and other construction related associations; peak employer and industry groups and key sector representatives; real estate institutes; relevant unions and the ACTU; perhaps the left, right and evenly-minded think tanks; welfare groups and so forth.

The initial Summit would be followed up by a second Summit after the draft White Paper has been published. There should only be three months between each summit.

This is needed now. Housing has become a political game when it is much too serious an issue for point scoring on the floor of the Senate.

For too long the states have ignored the housing problem. They have actually contributed to the issue as we have seen a decrease in funds for public housing with the resulting impact on disadvantaged groups in particular.

For too long various groups would push their own agendas or beliefs (removing negative gearing being one) without considering the other impacts that would come from the changes they propose.

We need a comprehensive response to this crisis, not a political one. Why?

Employers – large medium and small - in regional areas are finding it difficult to keep staff due to a lack of accommodation with many residences empty and unavailable due to AirBNB. Young people and older people are experiencing real difficulties in finding accommodation. We are seeing more people living in cars or on the street. The future is uncertain for many of these groups. Young people are despairing at ever owning a home due to the increasing cost of a family home. International students are having real problems finding accommodation and/or being able to afford the rent. Retirees are relying on their rental properties to fund their retirement and any changes would impact upon their standard of living and health.

(I believe that the fact that access to housing is slowing, as homelessness is growing, and small business is given nothing but lip service and pats on the head - is all connected. But I would.)

What ever happened to professional, inclusive, transparent policy development processes? Policy for the economy and people not policy to keep small unrepresentative groups happy and powerful?

The Libs and Labor suffer from this disease – the Greens are there as well. Can we plan ahead? Not jump from one policy silo to another never connecting them together?