Chapter:
15 - Housing
Mover:
Seconder:
 
 
Source:
EEIRT Policy Committee
My Private Notes


Preamble
​Public policy debate on housing has begun to focus more squarely on the moderation of housing price growth, so that affordability for middle-incomes is regained. Detailed public analysis has included Alan Kohler’s Quarterly Essay ‘The Great Divide’, with comment and advocacy subsequently from members of all national political parties and prominent independents.

This renewed and sharp focus on moderating house price growth over the long-term is merited in view of the sharp fall in affordability from its long-term average, following the return of interest rates to historically normal levels.

In the ACT, progressive policy has sustained apartment prices at a reasonable multiple of household income (within five-times the median apartment price). 

Overall, the ACT under Labor leadership remains a national leader in home ownership, though prices for town houses and detached housing have grown much faster than apartments.

EEIRT Policy Committee

For houses and townhouses there is an increasing divergence from apartment prices, limiting the ability of many to upsize, and to free up entry-level housing for new home-owners.

Regarding first-home buyers, Per Capita recently found that (at national level):

‘while 85% of non-homeowners still hope to buy a home at some point, fewer than one in four (24%) expect to be able to do so. Almost two-thirds of non-homeowners say that the only way they will ever be able to buy a home is if they receive a large inheritance.’

Facing a range of affordability from three-times to five-times household incomes, parity to the lower-end of apartments and to the higher-end of houses may form a reasonable long-term policy objective for the ACT. The groups most impacted by this disparity including single parents, predominantly women, and groups at risk of homelessness, where older women are the fastest-growing cohort.

The importance of this objective is rising with the return of interest rates to historically normal levels, and this question is keen for buyers who do not have access to deposit assistance through government programs or related parties (and who are targeted by unfavourable proposals like the LNP’s policy for use of superannuation). 
General Resolution

Supporting sustainable growth of housing prices

​ACT Labor calls on the Government to address formally in Budget papers and similar publication the progress of housing affordability and the moderation of house price growth with respect to incomes, including a focus on the balance of apartment and housing prices.

Suitable long-term policy goals, to be addressed in both supply- and demand-side policy and through clear signals to investors, independently and in concert with federal reforms, including:

- Returning median apartment prices to three-times median household income;

- Returning median house prices to five-times median household income.

- Engagement with the circumstances of specific groups, including single parents and older single-income households, noting the relevance to policy for women's economic security

These improvements to housing affordability can go along way to improving the ACT's attraction and retention of entry-level and key workers, especially those with less access to external capital for a deposit, who would be targeted by unfavourable proposals to use their superannuation for a deposit.

Directing capital and consumer spending to productive and diverse areas of the economy, more than to existing and unimproved housing assets, is essential for the ACT's sustained economic development.