Aussies aren’t having a bar of affordable housing policies

According to A Stark Reality: Part One in a Thought Leadership Series on Housing Choice and Affordability for a Growing Australia, 81 per cent of Australians believe their area lacks affordable housing.

PCA chief executive Mike Zorbas declared, “We have to change things up. We can’t afford another decade of failure.

“Whether it’s owned, rented, or social housing, we need to provide more opportunities to produce new and more housing options to meet our growing needs.”

Nearly half (46 per cent) of Australians believe the current lack of housing supply is more attributable to a lack of planning to deliver housing in line with population than any other factor. With this trend expected to continue with projections, the housing shortfall between 2025 and 2032 will be 163,400, while the number of apartments built in Brisbane, Sydney, Melbourne, and Perth in 2024 will equate to just 21 per cent of constructed stock in 2018.

The report contains comments from Reserve Bank of Australia (RBA) governor Philip Lowe, who claimed “Australia’s faster population growth [is] one of the reasons our economy has experienced higher than average growth than many other advanced economies.”

Despite the pandemic disrupting Australian migration patterns and the warm return of international travel in addition to the extinction of COVID-19 restrictions, Australia’s population bounce-back during the first half of last year exceeded expectations, with net migration for the year to 30 June 2022 at 171,000, with the federal government announcing a future expansion of the migrant cap to 195,000.

Population growth is not a primary concern for Australians, according to the report. Mr Zorbas explained this is due to the fact that the pandemic “brought the huge value of skilled migration to our economy into sharp focus,” adding that attention has turned to “the role planners have to play in providing the choice and affordability Australians deserve.”

The report cited further comments from Governor Lowe, who stated that “the underlying driver in our housing market is the balance between supply and demand.” He added, “It is hard to escape the conclusion [that] we need to address the supply side if we are ever to avoid ever-rising housing costs relative to incomes.”

State-by-state analysis found NSW possesses the nation’s worst planning scheme, which the report brandished as one that “consistently fails to sustain a durable pipeline of housing, knowingly undershoots its own housing targets, has a complex legislative and regulatory approvals process, fears necessary conversations with recalcitrant local governments, and applies high rates of taxation to new housing.”

Just one council, the Hills, is on track to meet its housing targets.

The suite of potential solutions flagged within the report includes “giving Australia’s new Housing Supply and Affordability Council the power to publicly scorecard and rank the states and territories on their housing supply efforts, and showing how governments can boost the supply of retirement living, purpose-built student accommodation, and build-to-rent housing.”

It also outlined a five-point plan to boost housing choice and affordability for a growing Australia, which is as follows:

1.   Holding governments to account and incentivising them to deliver:

The previously stated scorecarding of each state’s housing strategies and tracking of home production should be linked to financial incentives negotiated between the Commonwealth and other tiers of government, in addition to accountable planning systems.

2.   Delivering the housing we need, where we need it:

In line with the Albanese government’s housing accord announced last year, this aims to improve housing variety in needed areas to produce better outcomes related to affordability and offer people the freedom to pursue their desired lifestyles. It would involve designing, implementing, and enforcing clear housing targets across all governmental levels, as well as guaranteeing all capital city and regional growth plans have strong supplies of well-located homes.

3.   Great and sustainable cities:

Given Australia’s cities acting as “magnets for innovation and commerce,” amongst other benefits, this recommendation would see a reimagining of “the way cities are governed, as well as how they can assist people to adapt and mitigate climate change.”

4.   Supporting people who need it most:

Look after more Australians who need the pathway to home ownership eased, as is currently being done with a myriad of governmental schemes across the country, and ensure they are able to enter the market quicker and cheaper than previously imagined.

5.   Unlocking investment in new forms of housing:

The report believes that “Australia needs to replicate the success of overseas markets in harnessing the capacity for institutional capital to play a major role in diversifying housing options.”

REB will continue to unpack the insights contained within the report over the coming weeks.