Australia Facing Housing Affordability Crisis

Flickr image: Some rights reserved by mollyeh11

A coalition of housing, welfare and community organisations is campaigning to put the issue of affordable housing on the national political agenda and pressure the Federal Government to do act on reducing housing costs in Australia.

The Australians for Affordable Housing (AAH) Campaign launched in Canberra with the release of the report, Australia’s Broken Housing System, which reveals the grim state of the Australian housing market for those trying to find affordable housing.

The report reveals that over the last ten years, house prices in Australia have risen by 147 percent, while incomes have only risen by 57 percent. In the last five years rents have risen at twice the rate of inflation.

The report says that on average, housing costs account for 18 percent of household spending – however over 720,000 low to middle income households pay more than 30 per cent of their income on housing, and more than 460,000 households spend more than half their income on housing costs.

Sarah Toohey, manager of the Australians for Affordable Housing campaign, says housing affordability is the single biggest cost of living issue facing Australians.

Toohey says it is becoming harder for Australians to secure affordable housing as it now costs 6.2 times the annual average income to afford the median house price.

She says despite significant investment in recent years, there are less public and community housing properties now than there was in 2003.

The Australia’s Broken Housing System report reveals that between 1997 and 2007 the number of public housing properties in Australia shrunk by 30,000 – but during this same time the population grew by over 2 million people. Despite the significant, but one off investment in social housing through the Nation Building Stimulus package, Australia still has fewer public housing units than in 1996.

More than 60 Not for Profit organisations – mostly housing and welfare organisations – have joined the campaign calling for government reform to make it easier for Australians to put a roof over their heads.

AAH says there is no single cause of Australia’s housing affordability crisis. Rather, it is the result of a range of problems in the home ownership, private rental and public housing markets, all of which need to be tackled in a comprehensive and coordinated way.

The campaign is calling for changes to tax arrangements that benefit investors over low income and first home buyers, more investment in low cost housing in Australia, more support for low income renters, and a single cabinet level housing minister who is responsible for delivering these changes. AAH is also calling on the Government make housing a central issue of debate at the Government’s upcoming tax forum.

Cath Smith, Chief Executive Officer of VCOSS, says one in twenty Victorian households (more than 109,000 households) pay over 50 percent of their income on housing.

She says housing problems are particularly severe for renters, with more that one in the five low to moderate income renters (over 65,000 households) in housing stress.

Greens housing spokesman, Senator Scott Ludlam says the campaign couldn't come at a better time. He says a whole generation of people have been priced out of affordable housing, and Governments at all levels seem incapable of do anything about it.

Senator Ludlam says the Greens have consistently warned that the First Home Owners Grant, on which $13 billion has been spent, is pushing up housing prices and is not a solution to the housing affordability crisis.

He says successive federal governments have failed aspiring home owners by not once studying the inflationary impact of the grant on affordability.

The Greens are calling for the reinstatement of a dedicated Housing Minister – Ludlam says he wants to know why on earth the Environment Minister responsible for Housing affordability. 

Toohey says removing the stamp duty – an unpopular tax with purchasers – is not a silver bullet for fixing housing affordability.

She says rather than quick fixes, the government needs to examine a range of measures that will work in conjunction to actually improve housing affordability. 

Australians for Affordable Housing want housing to be a central issue of debate at the Government’s upcoming tax summit. Key AAH partners including ACOSS, National Shelter and the Community Housing Federation have already made submissions and will be attending the Tax Summit.

• Click here to download the 'Australia's Broken Housing System' report [PDF].

For more information on the Australians for Affordable Housing Campaign, visit www.housingstressed.org.au