Australian ‘housing choice’ gets stark reality check: Report

A stark reality: Part one was launched on Wednesday (8 February) at Parliament House at an event attended by federal Housing Minister Ms Julie Collins and newly appointed Property Council of Australia (PCA) chief executive Mr Mike Zorbas.

It came as Ms Collins was also to announce in Parliament that the Albanese government would introduce its “landmark housing legislative package” this week. Specifically, this will include legislation to create the $10 billion Housing Australia Future Fund to build 30,000 new social and affordable homes.

Minister Collins stated: “We don't have enough homes. We need to build more and we need to build them sooner, and I'm looking forward to getting on with the job.”

“The Albanese Government is taking decisive action, with a focus on co‑investment and collaboration to better align our values with social and economic goals.

“By doing so, together we will ensure more Australians have access to safe, secure and affordable housing, as well as better housing choices that are close to work, schools and transport.

She continued: “Later this week when I introduce the housing legislative package to Parliament, I will be putting forward policy that represents the efforts of innumerable stakeholders – including all of you here today.”

“I congratulate the Property Council of Australia on the launch of Part One of its thought leadership series, and I look forward to reading subsequent releases,” Minister Collins said.

Community sentiment forms 'starkest' picture yet

The government announcement coincided with the PCA report finding that a majority of Australians believe there is a “lack of affordable housing supply in their local community”, with “a failure to plan for our growing population” having the biggest negative impact on affordability.

According to the PCA, the paper drew together community sentiment and a suite of data to “paint the starkest picture yet of Australia as a global laggard in providing affordable housing for its people”.

Giving the Australian government’s newly formed Housing Supply and Affordability Council the power to publicly scorecard and rank the states and territories on their housing supply efforts was just one solution to help.

In essence, the plan — in partnership with the Productivity Commission and industry experts — is to develop an approach for “annual productivity scorecards” and “ranking on progress against stated housing strategies and targets”, it stated.

“This process should also design the principles of financial incentives to be negotiated between the Commonwealth and other tiers of government based on performance of meeting housing targets,” the report outlined.

The other idea involved showing how governments can boost the supply of retirement living, purpose-built student accommodation, and build-to-rent housing, it explained.

The great Aussie dream is even further away

Another key PCA report observation was that 81 per cent of Australians believe there is a lack of housing that is affordable in their area, with housing affordability the second-biggest concern among respondents, under cost of living in first place.

The survey also found that 45 per cent of Australians believe the government should arrange incentives to encourage developers to build more affordable housing stock for key workers like nurses, police, and teachers.

Additionally, 40 per cent of people want to allow more town houses and duplexes to be built to boost housing stock, it explained.

Notably, over half of all renters said they are renting because they “have no other option on the table”, with one-third believing they “won’t be able to purchase a home in the next five years”.

Putting global experience into action locally

“We have to change things up. We can’t afford another decade of failure,” said PCA’s Mr Zorbas as he highlighted that Australians are feeling the effects of years of inaction.

“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.

“The pandemic brought the huge value of skilled migration to our economy into sharp focus, which perhaps explains why people are less concerned about population growth as a negative driver, and are now more focused on the role planners have to play in providing the choice and affordability Australians deserve.

“Australia is home to property companies that lead the world in sustainability and resilience metrics. Now is the time to put that global expertise into action here at home, by delivering the housing choices for our growing needs, and lifting Australia off the bottom of the affordability ratings.”

Estimates are not stacking up

Mid-January, the Master Builders of Australia (MBA) had forecasted that new home building starts will fall significantly short of 200,000 per year, the volume of output that will be needed to meet demand, it explained.

Its forecasts indicated that this threshold will not be exceeded until 2026, the MBA confirmed.

“Our 2022–26 residential forecasts predict a bumpy road with a downturn over the next few years,” said Master Builders Australia CEO Denita Wawn.

“Forecasts will trend upwards as inward migration and interest rates stabilise, and pent-up demand shifts the dial.

“Builders continue to face regulatory burdens and prolonged delays in approvals for building applications, occupation certificates and land titles.

“Additionally, land shortages in the right places, high developer charges and inflexible planning laws are restricting opportunities to meet demand, speed up project timelines, and minimise costs to both builders and their clients.

“The industry remains committed to delivering the housing needs for today and the future and urges local, state, territory and federal governments to tackle these challenges head on.”

[Related: NHFIC earmarks $33m for affordable housing in Tassie]