Affordable Housing Party Looks to Restore the Australian Dream
30 August 2017 at 4:39 pm
A new political party focused on investing in social and affordable housing has been launched in Australia, as a new economic report warns the nation’s housing affordability crisis is likely to continue for the next 40 years.
The Affordable Housing Party (AHP) was registered with the Australian Electoral Commission earlier this month, and is hoping to end Australia’s housing crisis by pushing the government to adopt a comprehensive national affordable housing strategy.
AHP’s national convenor Andrew Potts has been a supporter of the Australian Greens, and is a former editor of the LGBTI media outlet the Star Observer in Sydney.
He told Pro Bono News that misguided government policy was the reason housing had become so unaffordable in recent years.
“Ever since the re-introduction of negative gearing and the extending of the capital gains tax discount on property, housing has basically been turned from a human need into a tax minimisation strategy in Australia,” Potts said.
“Negative gearing is an incentive for an investor to outbid a first home buyer at an auction. These tax advantages provide these additional incentives beyond simply having a roof over your head, so it’s caused many wealthy Australians to pour their money into housing which has caused a bubble.”
Potts’ concerns have been echoed by Committee for Economic Development of Australia (CEDA), which just released a comprehensive report into housing affordability which questioned if it was “time to let go of the great Australian dream” of home ownership.
The report said the housing crisis was likely to continue in coming decades, unless bold changes to housing policy were made.
“CEDA’s research shows that barring any major economic jolts, demand pressures are likely to continue over the next 40 years and supply constraints will continue,” CEDA research and policy committee chairman, Professor Rodney Maddock said.
“This is particularly the case in capital cities with a growing population and where an increasing proportion of Australia’s population are expected to reside.”
Maddock said one recommendation from the report was to increase access to affordable housing for people on a low income.
“One component of CEDA’s research considers the impact of housing affordability on the poorest citizens and includes a recommendation by Dr Judith Yates that Australia needs annually 20,000 new dwellings affordable to low income people,” he said.
According to Potts this is an idea the AHP would “certainly get behind, as increased federal funding for public, social and affordable housing is one of their key policy platforms”.
“We’d really like to see a re-focus of federal government funding into public and social housing,” Potts said.
“Particularly if you look [at] the amount of income tax that isn’t collected because of negative gearing, it’s something like $20 billion a year now. You can imagine how much public housing that would fund if that money was actually collected and put back into housing in this country.”
Adrian Pisarski, the executive officer of National Shelter told Pro Bono News this recommendation only scratched the surface of addressing the nation’s housing concerns.
“I think that’s a minimum that’s really required. We’ve been underinvesting in building affordable and social housing for the last 25 or so years,” Pisarski said.
“Apart from a brief period during the Rudd-Gillard years where there was significant investment, there hasn’t been significant investment in social and affordable housing for the last three decades.”
He also said the continuing housing crisis was putting an incredible strain on low-income earners hoping to find a home and on the organisations supporting them.
“The opportunities for homeownership are going to be really curtailed, but CEDA is just reporting a fact that we’ve been aware of for quite a while now,” he said.
“I think it’s already putting too much of a strain on welfare agencies and charities and it’s just going to continue to get worse and worse until governments realise the need to invest in social and affordable housing.”
The new political party said it did not have “faith in the government to make changes to the system”, so they will be running at the next federal election to lead the push for change.
“The problem is, so many of our federal politicians are property investors themselves, and we don’t believe they are going to pursue serious reform when they benefit from the status quo,” Potts said.
“We’d like to see changes around the taxation of investment properties and also see overseas buyers restricted from buying in Australia.
“There’s also a huge problem with overseas investors deliberately leaving properties empty and we believe taxing those properties may be a lever to get those properties back on the market, so people are able to rent them out.”
Potts estimated there were up to 300,000 empty properties, enough to house every homeless person in Australia and all those on a public housing waiting list.
But said he was optimistic that the Australian dream of owning your own home would remain alive, if serious reform was soon undertaken.
“I think that report is predicting what will happen if the status quo is maintained, but I think if policies are aggressively pursued to normalise the cost of housing, that doesn’t need to be the future we look forward to,” he said.