Tuesday, 29 May 2018
Matters of Public Importance
In Tasmania today people are camping out in tents in the Hobart Showground. One of them, Rachel, is due to give birth in October, and she is having to suffer through icy Tasmanian temperatures. She says:
… if I can't see it, it's not happening. Just stay in a ball and you'll be fine.
That's Rachel's way of dealing with the homelessness crisis Tasmania is currently struggling with. One of my own constituents, Adrian, wrote to me about his family's struggles. His children and grandchildren are finding it difficult to get into the housing market. He currently shares his house with his married daughter and her husband. Since his eldest was born 40 years ago, he has had only six months of living without his offspring. Lina, a woman in my electorate, recently wrote to me about living out of a suitcase after losing her mother. Annie, an older woman, has been left with few housing options after finding herself with little superannuation and no family.
Australia's homeownership rate is now at 60-year lows, and for 25-to-34-year-olds, the homeownership rate has collapsed from 60 per cent to less than 40 per cent over the past 30 years. Just in the time that the government has been in office, capital city house prices have soared by 30 per cent, with nearly 50 per cent increases in Sydney. Recent Reserve Bank analysis by Gianni La Cava, Hannah Leal and Andrew Zurawski measures the house-price-to-income ratio, and shows that in the early 1980s, it was less than two, and now it's over five. They ask what share of homes would be affordable to the typical first-home buyer, and find that nationally it is 32 per cent. In Sydney, it can be as low as 10 per cent. Compared with recent years, first-home buyers are finding themselves only able to afford homes with fewer bedrooms, further away from the centre of the city.
Now, there was a time when the Liberal Party was the party of home ownership. In his The Forgotten People speech, Robert Menzies said:
The home is the foundation of sanity and sobriety; it is the indispensable condition of continuity; its health determines the health of society as a whole.
He didn't think that the policy of the government ought to be to look after the rich. In fact, he said:
… in most material difficulties, the rich can look after themselves.
But the successors to Menzies don't have the same attitude. When asked about housing affordability, the Prime Minister told ABC host Jon Faine just to 'shell out' and help fund his kids' entry into the housing market. The member for New England told people who couldn't afford rent to move to the country. Joe Hockey said people should just 'get a good job that pays good money'. Indeed, two years ago we had the spectacle of the Prime Minister and the Treasurer posing with the Mignacca family, who had just purchased a property for their one-year-old child, Addison. What kind of a country is it in which the party of Menzies is now the party defending negative gearing for one-year-olds? Under Robert Menzies, we saw the home ownership rate go from half to nearly three-quarters of the population. But under the Liberals we're seeing home ownership at a 60-year low.
Labor believes that the great Australian dream has turned into a nightmare under Malcolm Turnbull. We will do something about housing affordability through a plan that will reform negative gearing and the capital gains tax concession. It's a plan which is backed by experts across the political spectrum: Saul Eslake, Chris Richardson, Jeff Kennett, Joe Hockey, the Murray review, the Henry review and the Reserve Bank of Australia. Labor's policy will see the construction of over 55,000 new homes in Australia over three years, creating over 25,000 new jobs. We'll close a tax concession used disproportionately by the most affluent, with surgeons 16 times as likely to negatively gear as nurses. We'll also limit direct borrowing by self-managed superannuation funds, boost homelessness support for vulnerable Australians, get better results under the National Affordable Housing Agreement, re-establish the National Housing Supply Council and re-initiate a minister for housing.
Every Saturday in Australia, first homebuyers are being outbid at auctions by home speculators. It wasn't always the way. If you go back to the 1990s, the value of loans written for first homebuyers and investors was about the same. Now the ratio is four to one in favour of investors. Prior to the 2017 budget, Minister Sukkar told Sky News, 'The housing package will be extraordinarily large; it will be far-reaching.' But as John Daley from the Grattan Institute said afterwards, 'I can't see any reason why this budget is going to make any discernible difference to housing affordability.' This government has no plans for housing affordability. Labor will tackle the crisis.