Australia’s property boom making the nation poorer

[themickey]

Yup, the next election could be horific, The large mass of struggling renters will turn against Liberals, National and Labor, the party's which pander to the entitled class.
The predatory real estate sector which has been handed unfettered license to prey will hopefully be their undoing.

 

[tony.m]

Yup, the next election could be horific, The large mass of struggling renters will turn against Liberals, National and Labor, the party's which pander to the entitled class.

It is the rich and powerful home owners which decide who wins the elections not the renters. 50% of the renters are overseas students and migrants.

 

[getthatintoya]

The whole problem in Australia is an easy fix but no government has the balls to do it. Abolish shit like payroll tax stamp duty etc and raise the GST. The GST is the most fairest tax there is as its a user pay situation. We are the lowest rate in the world even our cousie bros across the ditch are higher than us.

 

[themickey]

It can be guaranteed, if the housing realestate market were to collapse in the West, that governments would step in to bail it out, prioritising via looking after the capitalists while the working class would pay the tax by socialising for their losses.

 

[themickey]

Poor policy, not migrants, to blame for housing crisis: BCA
Phillip Coorey Political editor Aug 9, 2023

Australia’s housing crisis is the result of poor policy, not migration, the Business Council of Australia says, as it defends the influx of foreigners as nothing more than playing catch-up from the pandemic years.

In a paper to be released on Thursday, the BCA seeks to “bust the big-Australia myth” that the nation is being inundated with migrants, while also arguing that the post-pandemic intake should not be scapegoated for the housing shortage.

The paper comes before next week’s national cabinet meeting, at which Prime Minister Anthony Albanese will secure agreement from the states to help with housing supply and rental rights, and as the Greens and Labor continue to do battle over affordable housing policy.

On Wednesday, Greens housing spokesman Max Chandler-Mather added a fresh demand that the government consider adopting the Greens’ super profits tax, or “tycoon tax”, and use the proceeds to help fund affordable housing.

The BCA paper backs the big business view that migration makes for a stronger economy, while repudiating as “totally disingenuous” claims that the country is being swarmed.

The BCA notes that net overseas migration, which contracted during the pandemic, was forecast in the May budget to be 1.24 million people over the four years from 2022-23 onwards.

“Some have characterised this as a ‘big Australia policy’, but this is a totally disingenuous representation of the nation’s migration and population story,” the paper says.

“Today, Australia’s population is estimated to be over 375,000 people below the forecast prior to the pandemic.

“Even by the end of the decade, the population is still expected to be 225,000 short of the pre-pandemic projection for that same period.”

‘Return to normalcy’
It says the 1.24 million net overseas migration forecast appears high at first blush, but was in reality “a rebalancing of migration numbers on the path to a return to normalcy”.

“In particular, it reflected the previous departures in international students and working holidaymakers in prior years, who are now returning to the country,” it says.

“Furthermore, because so many people left during the pandemic, the number of people that would normally depart each year (such as students finishing their degrees and returning home) is well down on typical figures, inflating the ‘net’ number above the typical long-term average of 235,000 per annum.”

Migration is forecast to return to normal patterns from 2024-25.

Immigrants need housing
Nonetheless, the reopening of the borders has exacerbated the housing crisis and fostered anti-immigration sentiment.

Opposition Leader Peter Dutton supports immigration but says the government is being irresponsible by allowing in the equivalent of the population of Adelaide without adequate housing.

The BCA argues the provision of sufficient housing is necessary to maintain public support for immigration.

“The lack of supply of housing is a real problem, but migration is not the critical issue driving it, nor is reducing migration the solution to this problem,” it says.

It notes growth in new housing supply has slowed since 2016-17 and, as Reserve Bank of Australia governor Philip Lowe has pointed out, people want more space.

“The pandemic reignited and accelerated the trend of declining household sizes,” the BCA says.

“This drove housing demand even while population growth stalled.

“Poor performing planning systems and restrictive zoning are significantly impacting the delivery of new housing supply.

“Housing approvals are currently at decade-lows, with the short-term impacts of material and labour costs, interest rates, and the long-term underlying issues of regulation and restrictive planning policy impacting
on supply.

“Governments must act to fix this problem, rather than using migration as a scapegoat for poor planning.”

Housing accord ‘critical’
Mr Albanese will seek to tackle some of these issues at national cabinet in Brisbane next week, where which issues of supply and the national housing accord will be high on the agenda.

“The national housing accord is really critical. That is about land release and that’s about zoning and it’s ... making sure we increase supply because that is what will make the big difference,” he told parliament.

“I’m confident that next week we will have some really good results and outcomes.”

He again implored the Greens to pass legislation for the $10 billion Housing Australia Future Fund and insisted he did not have the power to force the states to adopt rent freezes or caps, even if he wanted to.

The Greens’ Mr Chandler-Mather said it was obscene that the Commonwealth Bank reported a record $10.2 billion annual profit while its mortgage holders struggled with repayments.

“So often, we are told the Greens are radical for proposing a two-year cap or freeze on renting. We are told we are radical because we want $2.5 billion a year for public housing.

“But apparently it’s moderate if the banks can record a $10 billion profit while more and more people are sleeping in their cars. That is why people are angry.”

 

[tony.m]

Australia’s housing crisis is the result of poor policy, not migration, the Business Council of Australia says, as it defends the influx of foreigners as nothing more than playing catch-up from the pandemic years.

Overcrowded schools, crowded emergency rooms, clogged roads and yet all this has nothing to do with migration ?

 

[themickey]

State Parliament
Six graphs show cost of living crisis is hitting those who can least afford it

By Max Maddison August 11, 2023
https://www.smh.com.au/politics/nsw...-who-can-least-afford-it-20230810-p5dvdl.html

For Emma Warren, 47, the everyday costs continue to mount, but there’s nothing left in her budget to give.

“I don’t think many of my friends know how close I am to the edge financially,” she says. “I cried last night for a bit. Every now and then it just gets on top of you.”

Emma Warren is facing eviction as she is unable to cope with rising rent and rising living costs.Credit: Peter Stoop

Warren receives a government disability pension due to her ongoing battle with Crohn’s disease, depression and anxiety. A photographer, her ability to work is dependent on her fluctuating health.

In December, her landlord hiked the rent on her one-bedroom Newcastle apartment by 15 per cent. She’s since cut back on medical and counselling appointments, turned off the heating and has begun selling off her belongings to pay for day-to-day items.

Gone are any social activities she used to enjoy with friends, something she describes as being like an “invisible lockdown”.

After 10 years in her rental, she needs to find a new place to live after being hit with a no-grounds eviction notice. There’s nothing in her area within her price range.

“I can’t find any more money,” she says.

Warren’s plight is a microcosm of the situation facing many households across the state, according to the NSW Council of Social Services Cost of Living 2023 research. It found dual housing and energy crises were cutting deep into budgets, forcing families to sacrifice essentials to survive.

Undertaken by the University of Technology Sydney, the survey of 1134 people living below the poverty line and in low-income households across NSW illustrates the struggles many face on a day-to-day basis.

The report found more than 70 per cent of respondents experiences housing stress, defined as spending more than 30 per cent of their income on housing; while nearly 80 per cent of low-income households said utility bills were the expenditure putting their budgets under the most strain.

Titled Barely hanging on: The Cost-of-Living Crisis in NSW, the report reveals household emergency funds have been eaten away by rampant inflation, particularly the rising cost of power bills, with almost two-thirds of respondents now having no money set aside.

For those with emergency savings, the average amount had halved in just 12 months, falling from $9137 last year, to $4050 in 2023.

The precarious financial situation of many households was being exacerbated by buy now, pay later services, with more than a quarter of respondents using the service three or more times to pay for essentials in the last year.

Almost 40 per cent had pawned or sold something because they needed cash.

NCOSS chief executive Joanna Quilty said the survey highlighted the “drastic measures” households were taking to stay afloat, including forgoing food, prescribed medication and hygiene goods to counteract rising living costs.

“Housing stress is at an all-time high. We know it’s bad, but it keeps getting worse. It doesn’t seem to hit a ceiling,” she says.

NSW Council of Social Service chief executive Joanna Quilty says many households were taking “drastic measures” to survive the cost of living crisis

“What came through from the focus groups was the distress, anguish and the pressure on families, and I think many are at breaking point.”

The financial stressors caused by inflation, which reached 7.8 per cent in the December quarter, were underlined by the jump in people’s inability to pay bills and essentials.

While 45 per cent of respondents said they had received a pay rise in the past 12 months, only 9 per cent said the increase had been sufficient to cover their increased costs.

A third of households surveyed could not pay utility bills on time, an increase from 24 per cent in 2022; while 28 per cent of respondents said they could not afford to travel for essential reasons.

While the pain was shared across NSW, rising utility bills were disproportionately hitting the regions, with over a third of households in Riverina, Murray and Central West ranking these as their number one expenditure under the most pressure.

The report noted the “prevalence of extreme housing stress is rife”, pointing to the seven areas of Sydney where more than a third of households are spending 50 per cent or more of their income on housing.

Almost one in five respondents said they were failing to pay their housing costs on time, a 27 per cent year-on-year jump since 2022. The onset of the housing crisis saw 14 per cent of respondents forced to move due to cost. That figure jumped to 18 per cent for renters.

While noting the state government can do little in the short term to resolve the cost-of-living crisis, the report presented nine recommendations to help alleviate the worst impacts.

It called for permanently increasing the value of Energy Accounts Payment Assistance vouchers to $2000, while allowing for the entire amount to be used for any energy type. Moreover, simplifying the application and approval process for available governmental rebates and vouchers.

With boxes of her belongings stacked up around her, Warren is worried if she can’t find a place within her budget, she will be forced to move into a friend’s garage.

“I’m finding it really tough to have positivity as I look towards the rest of the year. I’m finding it tough to feel hope. Governments just aren’t listening,” she said.

“I don’t need to hear your five-10 year plan on housing. What are you doing now?”

Energy Minister Penny Sharpe said the government was looking at providing rebates to help struggling households.

“The NSW Labor government takes the issue of support for low-income families very seriously. Energy rebates for about 1.6 million households are being rolled out.”

 

[themickey]

OPINION
Why this young Green Turk troubles Albanese to the Max
David Crowe Chief political correspondent August 11, 2023
https://www.smh.com.au/politics/fed...bles-albanese-to-the-max-20230809-p5dv8q.html

The prime minister knows exactly what this young Turk is up to with his all-out assault on Labor to force it to spend more on housing and do more to help renters. After all, Albanese was a young Turk himself. The leader and the upstart both came from Labor families, both joined the Labor left in their teens and both muscled their way past their seniors and into political office.

A tense exchange in parliament between Prime Minister Anthony Albanese and Greens housing spokesman Max Chandler-Mather.CREDIT:ALEX ELLINGHAUSEN

For Albanese, this meant being branded a radical from the “hard left” of his party. For Chandler-Mather, it meant quitting Labor at the age of 21 and winning the prize Brisbane seat of Griffith – Kevin Rudd’s old seat – for the Greens.

Now the tension between the two men sums up the competition between Labor and the Greens on a single, totemic issue: the $10 billion Housing Australia Future Fund that Albanese promised at the last election but Chandler-Mather will not accept. Part of the conflict is ideological – because the Greens always want to spend more money on social policy – but a big part of it is generational.

Albanese, born 1963, and Chandler-Mather, born 1992, are in a personal contest to claim the voters of the future. The Greens frame Labor as the soft party that protects the status quo, while promising younger Australians a far more radical solution: freezing rents nationwide, spending at least $2.5 billion a year on social housing, doubling rent assistance to about $3.5 billion a year and ending negative gearing for property investors. There is no doubt who is “hard left” here.

Illustration by Andrew DysonCREDIT:

The Greens give the impression they are winning. When Chandler-Mather walks the corridors of Parliament House, holding a mobile phone to his ear because he is always on message, he greets journalists with an almighty grin that shows he is having the time of his life. When housing experts turn up to his community meetings, they report a pulsating support for the Greens MP from constituents who are fed up with high house prices and rising rents.

Albanese, meanwhile, has pulled back from any hints about an early election. He spoke about a trigger for a double dissolution after the Greens and the Coalition blocked the Housing Australia Future Fund bill earlier this year. “We want this to be passed,” theprime minister saidon July 28. “The way to ensure that this doesn’t provide a trigger is to pass the legislation.” A few days later he moderated his language. “It doesn’t necessarily provide for an early election,” he said. “It could go into 2025.”

The careful language is smart. Voters are in no mood for an early election. Even the threat of going to the polls early would be an indulgence for Albanese and his ministers when they are meant to be governing. There is, however, a potential trigger if the Senate vetoes the housing fund when it goes to another vote in October. The last double dissolution election, in 2016, saw the Greens lose a seat in the Senate. Do they really want to run that risk again?

Greens leader Adam Bandt has been pragmatic on earlier government bills such as the Safeguard Mechanism to cut carbon emissions, so there is a suspicion that he is more inclined to pass the housing package than Chandler-Mather. The Greens clearly need more time to figure out their stance. They sought on Thursday to set October 24 as the new deadline for a Senate inquiry and report.

So who is winning? This is not a game: nobody is “playing politics” here because the Greens are seeking to lift their primary vote, take seats off Labor and change federal policy. It is too soon, however, to be sure about whether this is working. So far, at least, Labor and Albanese have a solid lead on housing policy in the Resolve Political Monitor poll published by this masthead.

No, prime minister ... Anthony Albanese after his exchange with Max Chandler-Mather.CREDIT:ALEX ELLINGHAUSEN

In July, for instance, 32 per cent of voters said Labor and Albanese were the best to handle housing, while 19 per cent preferred the Coalition and 15 per cent said others, while 34 per cent were undecided. This is in line with results when voters are asked about other policy issues, such as keeping down the cost of living. But these regular questions focus on the two major parties and do not routinely ask about the Greens. The key point is that Labor’s support on housing is not especially low.

The Greens are not gaining ground nationwide, either. The Labor primary vote has gone from 32.6 per cent at the election to 39 or 40 per cent in the latest Resolve surveys, while the Greens have gone from 12.2 per cent at the election to 11 or 12 per cent in the surveys. So the battle over housing is very much about targeting a few city seats where the Greens can edge ahead of Labor on the primary vote and claim the prize on preferences – exactly what Chandler-Mather did in Griffith.

Younger voters now have a real contest for their support. The Greens have a simplistic policy with their call for a national rent freeze, given that state premiers such as Chris Minns in NSW rule out the idea fearing it would hurt housing supply, but they are harnessing the frustration of renters who have no reason to trust any assurances about gentle policy change.

Since the onset of the pandemic in 2020, says research from the Reserve Bank, rents paid by new tenants have increased by 24 per cent. The impact is lower for tenants who’ve stayed in the same property through those years, but the financial pain is enormous and must be addressed by political leaders.

Albanese meets state premiers and territory chief ministers in Brisbane on Wednesday and is confident of a deal on housing. The likely outcome will be a promise to change planning and zoning laws to ensure new homes are built more quickly and an agreement on national principles on renters’ rights.

Problem solved? Not at all. The national cabinet deal will stop short of the demands from the Greens for explicit laws to freeze rents and embrace the long-term leases seen in Europe. Calls for more radical change will continue to resonate.

The immediate fight in parliament – the stalling of the $10 billion fund – becomes a smaller part of this generational contest over time. The fund only adds 30,000 dwellings over five years, albeit with the important change of setting up a permanent structure that can be expanded in later years. Albanese is pursuing other policies that will make the housing fund less totemic.

Labor has given the states and territories a surprise $2 billion for social housing, increased rent assistance by 15 per cent, promised $2 billion in financing for community housing providers, and is trying to sign up superannuation funds and other investors for a National Housing Accord that aims to build 1 million homes. At each stage, Albanese unveils more policy that does not need a vote from the Greens because the last thing he wants is to give them any credit.

Would all of this happen without pressure from the Greens? Of course not. The contest is on. Albanese may not be a man of the “hard left” any more, but he still knows how to go hard.

David Croweis chief political correspondent.

 

[themickey]

Politics Federal RBA
Lowe drops truth bombs as he prepares to leave the RBA stage

By Shane Wright August 11, 2023

Almost seven years ago, Philip Lowe used his first appearance as Reserve Bank governor before federal parliament’s economics committee to express his concern about high house prices.

As a parent, he worried that house prices were too high and beyond the reach of future generations. The problem, Lowe noted, was the cost of land sitting beneath all those homes.

Outgoing RBA governor Philip Lowe says land in Australia is the most expensive in the world.Credit: Alex Ellinghausen

“The value of our land relative to our income is incredibly high. Why is that?” he asked.

On Friday, fronting the same House of Representatives committee for the last time, the cost of land was again on the governor’s mind. If anything, the situation had deteriorated.

“Housing is expensive not because the cost of building a house or an apartment is expensive, it’s the land,” he said.

“The land embedded in each dwelling is very expensive, perhaps the most expensive in the world.”

How expensive is this land? The Housing Industry Association estimates the median price for a square metre of dirt in a new residential block in Sydney is about $1827. A decade ago, it was $601.

For all the complaints about Lowe and the Reserve Bank under his tenure – and there have been a lot – no one could rightly single out the governor for blame over Australia’s high-priced land and housing.

Lowe did point the finger at those who have contributed to the situation where a nation with a whole continent to itself has land so expensive that it is a growing drag on the economy and society.
Local and state governments, Lowe argued, needed to deregulate planning and zoning laws or land would just get more expensive. The cost of that land would be borne by future generations already facing major issues that mean Australia won’t be able to rely on what it can dig out of the ground or grow on it.

Bad policies wouldn’t help.

Lowe likened calls for rent freezes (being championed by the Greens) to policies (which both the Coalition and Labor have backed) that give money to people to help them cope with ever-increasing property prices.

“They’re short-term fixes that both, in my judgment, make the situation worse,” he said.

His comments on property prices and policies were the most important truth bombs exploded by the governor during his swansong appearance.

Lowe’s term as governor has been unlike anything experienced by his predecessors, bar Sir Ernest Riddle, who was in charge during the Great Depression (and who probably made Australia’s experience during that period worse than it should have been).

The low inflation/low wage growth period pre-COVID, the pandemic itself with the RBA engaging in quantitative easing, and then the post-pandemic inflation surge would individually challenge any central banker. Lowe and his team copped them all.

But he showed he continues to think about the bank’s broader role in the community.

Monetary policy, he said, was a blunt instrument – one that affected people differently (mortgage-free retirees with money in the bank are doing much better than young people seeking a rental property) and which could be unfair.

Central banks have the job of setting interest rates because politicians can’t be trusted to make tough and unpopular decisions.

According to Lowe, there has to be a better way to manage the economy, one that includes the political class. But don’t expect him to vent about his views once he leaves the governorship.

Pressed by Labor’s Jerome Laxale whether he would follow the lead of former prime ministers Tony Abbott or Julia Gillard, he said neither.

“I don’t plan to be a public commentator.”

 

[themickey]

....Central banks have the job of setting interest rates because politicians can’t be trusted to make tough and unpopular decisions.

Politicians can't be trusted, period!