The National Housing Supply and Affordability Council’s first “State of the Housing System” report lays bare the catastrophic failure of both Labor and the Liberals when it comes to housing.
The government’s own report says Australia has some of the least affordable housing in the world, with the second highest rent increases of advanced economies in 2023 and highest mortgage repayments. Europe, with widespread use of rent controls, has the lowest rent increases of all advanced economies (page 96).
The report confirms Australia has the highest housing costs for households on record, the lowest share of social housing on record due to chronic underfunding and demolition of public housing, and more homeless than ever before.
The report confirms Labor will miss its own National Housing Accord targets by hundreds of thousands of homes. This failure comes down to Labor’s almost entire reliance on private developer profits - as the report notes “increasing construction costs have eroded builder profit margins and limited the extent to which higher prices induce new supply” and that “higher interest rates are constraining supply by adding to the cost of bank debt and other financing options for builders and developers.” (page 4) The report confirms the system’s over-reliance on developer profits for housing supply, noting that “from 2025, supply is projected to increase as the recent rise in rents and dwelling prices and a slowing in the cost of dwelling construction induce developers to add to the dwelling stock.” (page 6)
Meanwhile the report makes clear the tax system is driving inequality in the housing system and disadvantages renters.
The Greens say the report shows that Labor should adopt the Greens plan to phase out negative gearing and the capital gains tax discount and invest the savings in establishing a public developer to build 610,000 homes, to build and rent at prices people can actually afford.
In fact if Labor adopted the Greens public developer proposal, the government would build 360,000 homes in the next five years, pushing housing construction from 943,000 to 1.3 million homes, smashing the government’s own targets.
Quotes attributable to Australian Greens Housing spokesperson Max Chandler-Mather MP:
"The government’s own report confirms what everyone but the Labor party already knows, Australia’s housing system is fundamentally broken and we need a bold plan to fix it," Mr Chandler-Mather said.
"On every measure Labor is failing catastrophically and the result is devastating for the millions of Australians getting smashed by skyrocketing rents, house prices and mortgages.
"The report tells us that the reason that developers aren’t building right now is because they can’t make big enough profits, and are waiting for even higher house prices and rents.
"But what sort of cruel broken housing system relies on skyrocketing rents and house prices to encourage developers to build housing?
"The lowest rent increases in the world also happen to be the place with widespread use of rent controls, and high proportions of public housing made widely available to people on low and middle incomes. So it seems pretty bloody obvious Labor should adopt those policies here.
"In fact, this entire report is a comprehensive rationale for Labor to adopt the Greens plan to cap rents, phase out the unfair tax handouts for property investors, and invest the savings in a government public developer to build homes to be sold and rented at prices people can actually afford.
"The only way we are going to solve this crisis is if the government steps in and starts building hundreds of thousands of homes itself, which is exactly what the Greens are proposing."
