Once again, the legacy media pontificate on Australia’s housing crisis, and again they completely ignore the elephant in the room. Even worse, rather than ignore the single greatest cause of the housing crisis, they advocate the very policies that are guaranteed to make it infinitely worse.
First, the admission that the housing crisis really is as dire as you’d think.
The cost of a typical Australian home has soared to 8.2 times as much as household incomes, the worst housing affordability on record.
First home hopefuls will be squeezed further by rising rents, as the share of income required to afford rent is also at a record high of 33.4 per cent, Cotality research released on Tuesday shows.
Experts warn property prices are likely to keep rising next year, despite efforts from different levels of government to improve affordability.
Not despite, but because of government meddling.
“The supply side alone doesn’t get us there, especially in the current environment where construction costs are so elevated,” Cotality head of Australian research Eliza Owen said.
And why are construction costs so high? Materials are more expensive because of government policies, especially ‘Net Zero’. Soaring energy costs directly resulting from Boofhead Bowen’s demented obsession with ‘renewables’ is sending steel and cement costs through the roof. The parasitic growth of red and green tape regulations is also strangling supply. Finally, successive governments’ obsession with university, at the same time making it increasingly unaffordable for small businesses to hire apprentices, has caused a dramatic shortfall of workers.
The more the government meddles, the worse it gets.
“We’ve seen several instances of demand side stimulus, rather than demand side cooling, in the form of HomeBuilder and more recently the unlimited expansion of the five per cent Deposit Scheme.”
All successive governments have done is ensure housing prices rise directly in tandem with government subsidies to home buyers. Subsidising low-end buyers simply makes low-end properties, once the entry-level, even more expensive.
Owen said it was no longer enough for households to move somewhere cheaper.
“It just spreads the problem further,” she said. “The strongest rate of growth has been in the lowest value segment of the market and that’s because relatively high and median income households are turning to the low end of the market.
“They have greater purchasing power and that spills over to the next most affordable and the next most affordable until there is no next most affordable.”
Yet, with head-smacking cluelessness, these idiots immediately opine that the solution to government meddling driving up house prices is more government meddling.
“So the solution needs to be very deliberate establishment of non-market housing … to protect people on lower incomes and to make sure key workers have decent access to the areas that they service.”
In other words, rent and price controls. Which, as Thomas Sowell establishes at great length in Basic Economics, has only ever had the effect of driving up prices and strangling supply.
But, basic economics is a closed book to the left-elite. Even when they get it, they don’t get it. Or at least, they utterly refuse to even consider sacrificing the gigantic holy cow of the elite: mass immigration.
AMP chief economist Shane Oliver said the shortage of housing relative to demand had been making affordability worse […]
“Supply simply hasn’t kept up with demand. The last few years we should have been building 230,000, 240,000 homes a year. We’ve been starting 170,000,” he said.
“We can fix it. We have plenty of land in Australia.”
Sometimes you just want to grab these people and smack their head repeatedly against the deck until they get it. It’s not supply: it’s demand. Importing millions of people every few years creates a demand that supply just cannot match. We have plenty of land? Sure, and most of it’s uninhabitable desert where no one wants to live, least of all immigrants. So, they flock to the handful of big cities, nearly all built on the scarce arable land of the east coast.
Arable land that is more and more being lost to endless suburban sprawl. Simply drive out of Melbourne and see where once-thriving market gardens have been ploughed under miles and miles of cheek-by-jowl McMansions.
Is this the Australia we really want?
