Welcome, dangerous and interesting ideas
Have you ever been at one of those planning days when the moderator says “there is no such thing as a bad idea”?
The recent flood of ‘ideas’ across the media in recent days trying to ‘fix housing affordability’ has felt like one of those sessions.
We’ve had the welcome, such as ideas to bring more supply of housing through. We’ve had the dangerous, like radically changing negative gearing and capital gains tax arrangements that have kept rents low. We’ve had the interesting, like potential downsizer incentives.
We’ve had the distractions, like blaming foreigners for all our woes (again). And we’ve had the well-meaning but self-defeating, like allowing people to use their superannuation to buy houses, which would just send prices higher.
With May’s Budget already dubbed ‘the housing affordability Budget’, the government needs to deliver policies that take price pressures off our biggest cities without risking new investment.
With plenty of good and mad ideas floating around. Here are the five questions that we will ask when assessing if a policy should be considered.
- Does it encourage the construction of new dwellings – at affordable prices – to match our population growth?
- Does it reduce the costs of buying housing and make it easier for people to move house?
- Does it help close the deposit gap?
- Does it open up innovative means to deliver affordable housing?
- Does the proposal actually make the problem worse?
The Budget must address the issues that impede housing supply.
While we witnessed the construction of a record 231,000 dwellings across Australia during 2016, activity has been falling for eight months. Continued investment in new housing is vital if we are to tackle affordability.
In the coming weeks, we will release a comprehensive package of housing reforms that the Government should consider.
This won’t be about gimmicks or quick headlines that do nothing for the underlying problem.
Instead, we will be offering practical solutions to an issue which is keeping hundreds of thousands of people from purchasing their home and securing their financial future.